FirstAu signs agreement to acquire Sandstone Gold Project

FirstAu has signed a binding agreement to acquire the Sandstone Gold Project from Complete Prospecting.

The deal covers five tenements, comprising four prospecting licences and one exploration licence, in Western Australia's (WA) Sandstone gold district.

The project provides access to an extensive historical reverse circulation drilling database at the Harmonic and Creasy prospects.

This dataset is expected to enable FirstAu to begin work from a more advanced stage in defining a Joint Ore Reserves Committee (JORC)-compliant mineral resource.

The project area encompasses approximately 3.5km of the Mayard Greenstone Belt and also includes exposure to the Crook Well Greenstone Belt.

The geological mapping identifies zones with numerous faults intersecting the north-south strike of the Mayard Terrane, considered significant for local mineralisation.

Under the agreement, consideration for the acquisition consists of a $252,486 (A$350,000) cash exclusivity fee, A$400,000 in FirstAu shares and A$150,000 in deferred consideration.

The deferred portion will only become payable if FirstAu announces an inferred or higher classification mineral resource of at least 10,000oz of gold, with a minimum grade of 0.5 grams per tonne, within five years of completion.

If this milestone is not met, the deferred consideration will lapse.

The share consideration will be issued at a price based on the volume-weighted average over the 15 trading days before the completion date, subject to shareholder approval.

Completion of the acquisition is dependent on customary shareholder, regulatory and third-party approvals.

FirstAu has also agreed to a drilling commitment of A$250,000 on the tenements within 24 months of completion. If this minimum commitment is not reached, any shortfall must be paid to the seller in cash upon request.

The company plans to begin validating the existing drilling data following completion of the deal, aiming to define a maiden JORC-compliant mineral resource.

FirstAu executive chairman Daniel Raihani said: "The acquisition of the Sandstone Gold Project is an important addition to FirstAu's growing Western Australian gold portfolio and provides us with an advanced exploration opportunity where substantial historical work has already been completed.

"What particularly attracted us to Sandstone is the combination of prospective geology and the substantial historical drilling database."

"FirstAu signs agreement to acquire Sandstone Gold Project" was originally created and published by Mining Technology , a GlobalData owned brand.