Black Cat Syndicate has accelerated its ambition of becoming a mid-tier gold producer after purchasing two mothballed gold assets from Northern Star Resources.
The Coyote and Paulsens gold operations in Western Australia will change hands for $14.5 million in cash to be paid at the completion of the sale, $15 million to be paid on June 30, 2023, and $10 million to be paid through four performance-related payments.
Black Cat will fund the transaction by way of a share placement at an issue price of $0.55 per share. The company said it had already received firm commitments for the placement with new and existing shareholders eager to get involved.
Both on care and maintenance, the Coyote and Paulsens gold operations in Western Australia have been key gold producers in the past and will return to action within a few years under Black Cat’s restart plans.
Since beginning production in 2006, the Coyote open pit and underground mines have produced 211,220 recovered ounces of gold at 4.9 grams per tonne (g/t) at an average of approximately 35,000 ounces per annum.
Paulsens has produced 907,344 recovered ounces of gold at 7.3 g/t gold since first production in 2005.
Black Cat will complete aggressive drilling campaigns in 2022 and 2023 before targeting a Paulsens restart in 2025 and a Coyote restart in 2026.
“Black Cat has a proven track record of making acquisitions and then growing resources,” Black Cat chairman Paul Chapman said.
“We listed on the ASX in January 2018 with 80km2 of land, no resources and no mill. This transaction will have us at 1770km2 containing more than 2Moz at 2.5 g/t gold with two mills and a third well advanced,” Chapman said.
“The Coyote deposit sits in an exciting high-grade Callie-style environment with serious potential to significantly grow ounces quickly.
“Paulsens has been a consistent high-grade producer for a long period. There is ample opportunity at the assets to find another Paulsens like deposit as well as near-mine opportunities.”