Echo Resources has signed a letter of intent to award MACA two mining contracts at the Yandal gold project in Western Australia.
MACA is in position to win the open pit mining and mill refurbishment contracts at the project, which is 83 kilometres northeast of Leinster in the Goldfields.
Echo is yet to reveal the value of the contracts, but the estimated mining costs in the Yandal bankable feasibility study (BFS) have been set at $172 million.
The proposed scope of work for the mining contract includes load and haul, and drill and blast. The mill contract, meanwhile, will include refurbishment and commissioning.
Echo chief executive officer Victor Rajasooriar said: “By involving MACA at this early stage and engaging with them constructively, we are confident of achieving efficiencies and synergies which will enhance the economics of the optimised BFS.”
MACA and gold miner Northern Star Resources have also participated in an Echo share placement that raised $4 million.
Northern Star, Echo’s largest shareholder, subscribed for $2.5 million of Echo’s shares, while MACA invested $1.5 million. The shares were valued at 11 cents each.
Echo plans to raise a further $2.5 million through an entitlements issue with eligible shareholders at a price of 10.5 cents per share.
It will use the funds raised for pre-development expenses at the Yandal gold project and for an exploration campaign at the Mt Joel project.
Northern Star owns 22.74 per cent of Echo following the placement.