Kingfisher Mining has signed a binding term sheet to sell its entire interest in 12 exploration licenses in the Gascoyne region of Western Australia to Dreadnought Exploration, a subsidiary of Dreadnought Resources.
The transaction, valued at A$2 million ($1.42 million), will be settled by the issuance of fully paid ordinary shares of Dreadnought Resources.
Additionally, Kingfisher could receive up to A$1.5 million in cash payments based on performance and depending on resource definitions.
Kingfisher retains a significant stake in the rare earths sector through its stake in Dreadnought and will benefit from future milestone cash payments.
The divestment is part of a strategic realignment aimed at strengthening Kingfisher’s financial position and accelerating exploration efforts in New South Wales (NSW) amid favorable commodity market conditions.
The Copper Blow project near Broken Hill stands out as a key focus within Kingfisher’s portfolio in New South Wales.
Recent drilling at Copper Blow has revealed the extent of high-grade copper-gold mineralization over a length of 600m.
Important analysis results include intersections such as 13 m at 1.2% copper and 0.26 grams per tonne gold from 23 m of 25CBRC_073.
Under the terms of the sale agreement, Kingfisher will transfer full legal and beneficial ownership of the properties, together with all relevant mining information, to Dreadnought.
The agreement covers two performance milestones. Kingfisher will earn A$500,000 if Dreadnought announces a Joint Committee on Mineral Reserves inferred resource in excess of ten million tonnes (mt) at 1% TREO on any property. Another million Australian dollars will be paid when defining more than 20 million tonnes with the same quality criteria.
The settlement of this transaction is subject to standard conditions, such as regulatory approvals and third party consents.
Pareto Advisory, as an independent third-party consultant, will be compensated A$20,000 in cash and Dreadnought Resources shares valued at A$60,000 for providing introduction and facilitation services.
Kingfisher CEO Chris Bittar said: “This transaction is a win-win for Kingfisher. It immediately releases vital funds to focus our energy and resources on the development of our exciting copper, gold, silver, zinc and lead projects in New South Wales.
“We have always believed in the potential of Gascoyne, but recognize that these properties are best served as part of a larger unified project where the true value of the assets can be unlocked in a more efficient and timely manner.”
In August 2024, the company commenced co-financed diamond drilling on Mick Well carbonatite targets in the Gascoyne region.