Evolution Mining has entered into an option agreement with Strategic Energy Resources to purchase tenements adjacent to the Cowal gold mine in New South Wales.
The gold miner will have two years to purchase a 100 per cent interest in EL9057 and EL9368 from Strategic Energy Resources, as well as associated information.
Consideration for the two-year option period is $300,000 cash, which can be extended for a third year for either tenement for the consideration of $100,000 cash per tenement.
Evolution must pay Strategic Energy Resources $1 million cash per tenement if it wishes to exercise the option. It does not need to purchase both tenements.
“The option for sale of these two assets to Evolution is consistent with our strategy of generating valuable exploration projects which can be divested to fund our greenfield exploration,” Strategic Energy Resources managing director Dr David DeTata said.
“These projects were identified and secured less than 18 months ago and have incurred minimal expenditure to date.
“The option to sell to Evolution represents a strong return on investment, is testament to our ability to identify and secure new projects and positions these exploration opportunities with Evolution to advance.”
EL9057 and EL9368 have undergone previous exploration for gold and copper, with Strategic Energy Resources possessing a large dataset of geophysical data, diamond drilling and aircore drilling.
Evolution is developing a new underground mine at its Cowal gold operations, with first stope ore scheduled for the June quarter of 2023.
The gold miner expects production to increase by approximately 40 per cent at Cowal in the next two years, reaching at least 320,000 ounces in the 2023–24 financial year.
Evolution was trading at $1.88 at the time of writing (11.00am AEST, September 26) with a market capitalisation of $3.45 billion.