Westgold Resources Limited (Westgold) has just announced the signing of a non-binding term sheet with Musgrave Minerals Limited (Musgrave), with plans to lead the mining and profit sharing from a number of open pits and/or underground mines in close proximity to Westgold’s processing hubs. The hubs are located at Tuckabianna and Bluebird in Western Australia.
The template resembles previous templates used with junior miners in the Kalgoorlie region, where Westgold plays the role of ‘manager, banker and operator’ for the feasibility and mining of the projects on a cost basis. The mining’s generated revenue is said to reimburse for the costs first, with surplus funds said to be split equally between the two parties.
This arrangement is said to cover known resources and immediate extensions (within 100m in any direction) of the Lena, Break of Day, Jasper Queen, Gilt Edge, and Rapier South deposits, respectively. The deal remains conditional on completion of a more detailed mine management and profit sharing agreement. In May, Westgold also announced that they had acquired a 15 per cent equity interest in Musgrave via a placement of $3.36 million to enable it to further expand upon its exploration success in the region.
“We are delighted to agree this term sheet with Musgrave should enable the exploitation of its known resources in the Murchison region without the usual imposts and risks that prevent juniors from getting projects up,” commented Westgold’s Managing Director, Peter Cook. Westgold’s three operations currently in production are Higginsville Gold Operation in the Norseman region of Western Australia, South Kalgoorlie Operations in the Kalgoorlie region and Central Murchison Gold Project in the Murchison region of Western Australia.
