Greatland Gold has entered into an option agreement with Flynn Gold to sell the Firetower and Warrentinna projects in northern Tasmania.
Firetower is a gold and battery metals project hosted in the Mount Read volcanic belt, one of Australia’s premier volcanic-hosted massive sulfide (VHMS) provinces. The likes of New Century Resources’ Mt Lyell copper project, Catalyst Metals’ Henty gold mine and MMG’s Rosebery base metal mine are located in this province.
Gold mineralisation has been delineated over 350m along strike and up to 150m depth at Firetower. Previous drill results include 54.5m at 1.36 grams per tonne (g/t) gold and 5m at 8.72g/t gold.
There appears to be anomalous cobalt (up to 0.57 per cent cobalt) and tungsten (up to 0.73 per cent tungsten) associated with the Firetower gold system.
Previous drilling at Warrentinna indicates the potential for a significant orogenic-style gold system. Drill highlights include 21.7m at 3.3g/t gold and 11.7m at 2.8g/t gold.
Flynn Gold will have six months or a period of 10 business days after the receipt of drilling permits from Mineral Resources Tasmania (MRT) to exercise the option agreement.
Upon signing of the option agreement, a non-refundable option fee of $100,000 will be satisfied by the issue of one million Flynn shares at a price of $0.10 per share.
Flynn will also be required to pay $200,000 to Greatland Gold, or issue two million Flynn shares at $0.10 per share, which may be subject to shareholder approval.
If Flynn was to define a combined JORC mineral resource of 500,000 ounces gold across the two project, it will be required to pay Greatland Gold $500,000. Flynn will then pay Greatland a further $500,000 upon the receipt of a MRT mine permit for any of the projects.
The Canadian miner, which holds a 30 per cent stake in the fancied Havieron gold project in Western Australia, would then hold a 1 per cent net smelter royalty on all production from the mines.
“The transactions allow Greatland to focus on its core projects in Western Australia,” Greatland Gold managing director Shaun Day said. “Greatland receives both upfront value and maintains a future economic interest in these projects, providing ongoing exposure to upside outcomes while delivering an excellent result for Greatland shareholders.”
Flynn chief executive officer Neil Marston said the projects were a natural addition to the company’s portfolio.
“At the Firetower project, previous exploration has identified significant gold with cobalt and tungsten mineralisation, which presents Flynn Gold with exceptional drill targets to test,” he said.
“Flynn’s option over of the Warrentinna project is an excellent addition to the company’s existing north-east Tasmanian assets as it adjoins our existing tenure at Lyndhurst. The Warrentinna project has a history of gold production and with limited modern exploration presents the company with some shallow gold targets to drill test.”
Marston said Flynn will undertake a program of data review, geological modelling, site reconnaissance and exploration planning during the six-month option period.