AusQuest and South32 have extended their strategic alliance agreement (SAA) to explore projects in Australia and South America until the end of 2021.
The targeted projects in the SSA include copper, zinc and nickel projects in Australia and Peru and may include other mineralisation styles and jurisdictions.
Under the terms of the SAA, South32 has exclusive rights to AusQuest’s projects by funding selected projects up to the drilling stage.
South32 can also elect to spend a further $US4 million ($6 million) on each project to earn a 70 per cent interest, with the right to earn an additional 10 per cent stake by completing pre-feasibility studies.
Under the terms of the updated SSA, AusQuest will receive an administration fee equal to 15 per cent of monies expended on all projects under the SSA.
Projects secured by AusQuest and offered exclusively to South32, undergo a staged evaluation process which sees projects classified as either exploration opportunities or drill-ready opportunities.
If a project is rejected twice by South32, at either the exploration or drill-ready stage, it becomes a rejected property and will no longer be a subject of the SAA.
Six of AusQuest’s projects are currently exploration opportunities under the SAA (three in Australia and three in Peru).
Two have been the subject of initial drill testing of targets (Balladonia in Western Australia and Hamilton in Queensland) with follow-up drilling proposed, three are being advanced towards drilling (Tangadee in Western Australia , Parcoy and Los Otros in Peru) and one (Cerro de Fierro in Peru) is the subject of a separate joint venture arrangement.