Gold Road Resources has confirmed an agreement to acquire Sumitomo Metal Mining’s 50 per cent interest in the South Yamarna project in Western Australia for $7 million.
This acquisition will consolidate Gold Road’s ownership of the majority of the Yamarna Belt, which currently hosts 6.8 million ounces (Moz) of gold in resource, the company explained in an ASX announcement.
In addition to becoming 100 per cent owner of the South Yamarna project, Gold Road also owns the North Yamarna project and 50 per cent of the Gruyere joint venture with South African miner Gold Fields.
Gold Road managing director and chief executive Ian Murray said the company established the South Yamarna joint venture with Sumitomo in 2013, at a time when it and most other junior explorers were experiencing severe funding constraints.
“Since then we have discovered the 6.2Moz Gruyere gold deposit, which will be producing gold and significant cash flows from 2019, and our economic circumstance have improved through the joint venture we concluded in 2016 with Gold Fields Limited,” Murray said.
“The partnership with Sumitomo has been an integral part in unlocking the potential of the South Yamarna project which we have shown to be prospective.
“The acquisition of Sumitomo’s 50 per cent interest in South Yamarna gives us greater control of the Yamarna Belt where we will be increasing exploration activities upon completion of the summer targeting and ranking process.”
In addition to paying $7 million in cash for the acquisition, Sumitomo will be granted ‘right of first negotiation’ and ‘right of first refusal’ on the project.