Orminex has acquired the Penny’s Find gold mine in Western Australia from Empire Resources, marking the mine’s second change of hands in less than six months.
Empire acquired Penny’s Find from former joint venture (JV) partner Brimstone Resources as a form of debt repayment in September 2018.
The company then established the Penny’s Find open-pit and underground gold resources, electing to mine the near-surface inventory to completion before putting it on sale.
Orminex will commence mining at Penny’s Find – purchased for $600,000 – 12 months from final legal documentation being signed.
“This acquisition fits the mineral ventures model perfectly as Penny’s Find has previous mining history, a mineral resource and potential for a long underground mine life, and the existing infrastructure provides quick lead time that allows us to get on with what we’re good at – mining,” Orminex chairman Daryl Henthorn said.
Orminex’s mineral ventures model is built on a strategic alliance with underground mining contractor GBF Mining, which provides capital and mining services to near-term production projects.
The two companies have performed a due diligence on Penny’s Find, showing its potential to be a viable, operational gold mine with its ore containing gold appearing to be accessible within a short period.
GBF will apply for an underground mining licence and all other approvals required to commence mining at Penny’s Find. It will also commence dewatering of the open pit, refine mine design and mine model and the installation of ground support.
Empire will receive royalty payments on the gold recovered for the life of mine, while retaining full ownership to the 32-square-kilometre exploration tenements outside of Penny’s Find’s mining area.
“The sale of the Penny’s Find mining leases is a timely disposal as on completion it provides to Empire a cash injection and the ability to participate in the royalty stream resulting from an earlier development of the project in a strong gold price regime than would otherwise have been possible with Empire’s current limited cash reserves,” Empire managing director David Sargeant said.