Boss Energy and First Quantum Minerals (FQM) have teamed up to explore for base and precious metals within the Honeymoon uranium project in South Australia.
The two companies have entered into an earn-in agreement that will fund an exploration program across five tenements at Honeymoon.
FQM, through its namesake Australian subsidiary, has invested $250,000 into an initial targeted exploration and due diligence program specific to the five tenements. The company must complete this by December 31, 2022.
From here, FQM has the choice to proceed to the agreement’s next stage (work program) or withdraw its involvement.
“The work program will comprise target definition programs and 1800m of reverse circulation (RC) and diamond drilling and all associated geochemical analysis. FQM must complete the work program by February 1, 2024,” Boss said in its announcement.
“After completion of the work program, FQM may elect to earn a 51 per cent interest in any base or precious metal discovery by sole funding $6 million of expenditure within five years and maintaining minimum annual expenditure of $500,000. At this point, the parties will enter into a joint venture agreement.”
From there, FQM can increase its stake to 75 per cent by sole funding exploration expenditure until a decision to mine. This must be done within five years and FQM must continue to maintain a minimum annual expenditure of $500,000.
FQM can extend this ‘second earn-in’ stage to 10 years if it chooses to increase the minimum annual expenditure to $1 million.
“After acquiring a 75 per cent interest, FQM shall continue to sole fund required studies and programs up to receipt of all permits for commencement of construction, after which Boss can maintain its interest of 25 per cent by funding its share of project development costs or dilute,” Boss said.
If FQM does not complete the second earn-in stage, its interest in the project will revert to 49 per cent, with Boss owning the remaining 51 per cent.
Boss will be the operator of the project until FQM has acquired a 51 per cent interest. FQM can then opt to become the operator if it wishes.
Complementing Honeymoon’s uranium prospects, it is suggested the project also features numerous other mineralisation styles, including iron oxide copper-gold (IOCG), stratiform copper-cobalt and zinc-lead-silver mineralisation.