Poseidon Nickel and Genesis Minerals subsidiary Mt Morgans WA Mining have signed an agreement for water access and gold tailings processing.
Under the new deal, Mt Morgans will undertake a trial processing of up to 100,000 tonnes of Lancefield gold tailings through its Laverton processing facility and have access to 2.5 gigalitres per annum of water from the South Windarra pit in Western Australia.
Poseidon acquired an option for the right to treat tailings from Lancefield in August 2020.
Genesis recently acquired Mt Morgans as part of its takeover of Dacian Gold.
The 2.9-million-tonne-per-annum Laverton mill is close to the Windarra and Lancefield gold tailings projects.
The Laverton mill is currently on care and maintenance with Genesis working towards an eventual sustainable restart, sourcing ore from nearby gold mining operations and the Lancefield gold tailings.
The quantity of water secured by this agreement is sufficient for future operating requirements at the Laverton mill.
“This is a great result for both Poseidon and Mt Morgans as we look to monetise our non-core assets and Mt Morgans progress with the restart of their operations at Laverton with a secure water supply and the opportunity to process the Lancefield gold tailings,” Poseidon chief executive officer Craig Jones said.
“The supply of water from South Windarra will not affect our development plans for the tailings recovery project at Windarra and allows for discussions to continue with third parties to advance various opportunities.
“The cost of the trial will be borne by Mt Morgans and any profit generated will be shared on an agreed basis, if successful.”
Poseidon has also entered into a farm-in agreement with Mantis Resources to earn-in up to a 100 per cent interest in tenements near its Lake Johnston project in WA.
“As we enhance our understanding of the lithium potential in the district, the farm-in agreement with Mantis is a strategic step forward to build value of our lithium portfolio at Lake Johnston,” Jones said.
“With the recent increase in lithium-focused exploration activity in the region, it is opportune timing for Poseidon to farm-in to these highly prospective tenements.”
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