Drilling contractor PYBAR Mining Services has secured a binding agreement for a profit share-based development at the Second Fortune Gold Mine, owned by Exterra Resources.
PYBAR will provide the funding to develop the Second Fortune Gold Mine under a life-of-mine services contract, with a $250,000 payment to be delivered no later than three months from commencement.
However, Exterra will retain 100 per cent of exposure to the exploration upside, outside of the agreed mining area of Second Fortune.
Exterra managing director John Davis welcomed PYBAR as partners in the new Fortune operations, into a strategy that would “minimise the dilution and risk profile for shareholders.
“PYBAR are a well-respected underground mining contractor with projects throughout Australia, including at Red October and Deep South for Saracen Mineral Holdings,” he said.
“These projects are within 25km of the Second Fortune mine and will provide important logistical benefits for the Second Fortune Project development.”
The agreement will begin six months after receipt of all approvals for production, for a four year term, during which PYBAR will an exclusive right to exercise all gold mining rights in the Second Fortune area and main lode resource.
Exterra will continue to explore and maintain 100 per cent equity in the Linden tenement package.