Tellus Resources cements acquisition of Queensland gold project adjacent to 3.5Moz deposits Thursday, May 17, 2012 by Angela Kean Tellus Resources cements acquisition of Queensland gold project adjacent to 3.5Moz deposits
Tellus Resources (ASX: TLU) has inked a formal share purchase agreement which will see it acquire an advanced North Queensland gold project adjacent to Kagara Mining's (ASX: KZL) 3.5 million gold ounce Mungana and Red Dome projects.
The soon to be acquired mining leases, known as the Chillagoe Project, cover the Empire and Wandoo prospect areas which are associated with geology similar to the nearby multi-million ounce Kidston, Red Dome and Mungana deposits.
Previous intercepts at Wandoo include 10 metres at 5.58 grams per tonne (g/t) gold and 20.5g/t silver from 88 metres, while the Empire prospect recorded an intercept of 7 metres at 7.65g/t gold from surface.
Tellus will wholly acquire Premier Mining in exchange for a A$950,000 cash payment and the issue of 5.5 million shares, which were last trading at $0.18 valuing the share issue at around $1 million.
If Tellus defines an Indicated JORC resource of at least 300,000 ounces of gold with a cut-off grade of 3g/t, the company will pay Premier a further $2 million in cash and issue $2 million worth of shares.
The Chillagoe Project includes a number of advanced gold, silver and base metal prospects and consists of one granted exploration permit, four applications for exploration permits and four granted mining leases.
Advanced exploration has already been completed with more than 14,000 metres drilled to date. Strong mineralisation is evident from surface and is open at depth.
KZL Price at posting:
12.0¢ Sentiment: Hold Disclosure: Held
