Metals X has locked in a $32 million joint venture (JV) with IGO at the Paterson base metals exploration project in Western Australia.
Metals X was exploring various options for its copper assets in January, which included the Paterson project that remained largely unexplored.
This was off the back of the company’s suspension of its Nifty copper operation in November last year due to a production plateau.
The Nifty operation is located nearby to the Paterson exploration project.
Hosting substantial gold, gold-copper, copper and tungsten mines and deposit, the Paterson province has hosted a number of recent discoveries by mining giants such as Rio Tinto.
Metals X chief executive Mike Spreadborough said the exploration project could potentially ramp up production at Nifty.
“IGO is a highly-regarded, successful and experienced exploration and mining company and this term sheet delivers a significant exploration commitment on our substantial and exciting tenement holdings in the Paterson province,” he said.
“Importantly, Metals X will retain full control of the Nifty copper operation and its established infrastructure plus the Maroochydore copper project which collectively host over one million tonnes of in-ground copper metal.
“Metals X looks forward to working closely with IGO to rapidly unlock the exciting exploration potential of the Paterson exploration project which could potentially deliver additional value through the established infrastructure at Nifty.”
IGO will fund exploration activities at Paterson for 6.5 years, earning a 70 per cent interest through the JV.
Exploration is expected to commence in the September quarter, with IGO having long-standing experience in the province and incorporating advanced targeting techniques including large scale magneto-telluric geophysical and proprietary geochemical survey techniques.
“IGO has recognised the exploration potential of the Paterson Province for some time. The joint venture with Metals X over 2400 square kilometres of highly prospective ground further consolidates IGO’s presence in this highly endowed, yet under-explored province,” IGO managing director and chief executive Peter Bradford said.
“We look forward to the creation of shareholder value for both IGO and Metals X through discovery”.