Chalice Mining is pursuing a demerger of its Australian gold assets, including the Pyramid Hill project in Victoria, to increase focus on the high-grade Julimar nickel-copper-platinum group elements (PGE) project in Western Australia.
The demerger, subject to shareholder and regulatory approvals, will aim to create more value for shareholders, according to Chalice.
In addition to the increased focus on the Julimar, Chalice will also look to advance the West Yilgarn nickel-copper-PGE province in Western Australia following the move.
Chalice’s Viking gold project is also included under the demerger, which it holds a 70 per cent interest in.
The company has engaged with key advisors to prepare for the demerger with its structure to be finalised once it receives legal, financial and taxation advice.
Chalice managing director Alex Dorsch said the demerger plans followed a board review of the company’s portfolio.
“The proposed demerger provides an exciting opportunity for our shareholders to benefit from the creation of a standalone, well-funded Australian gold exploration company with a high-quality asset base in Victoria and WA,” he said.
“This review concluded that the creation of a new gold-focused explorer would be the optimal structure to ensure that the full potential of the gold portfolio can be realised, while allowing Chalice to continue to focus on completing the resource drill-out and rapidly advancing studies at Julimar.”
Dorsch said recent exploration results had bolstered the opportunity for the gold demerger.
The Pyramid Hill project covers 5000 square kilometres and is located in the Bendigo Zone, which also hosts Kirkland Lake Gold’s Fosterville mine.
Chalice’s recent results at Pyramid Hill are considered tantalising from a greenfield exploration perspective, given the immense regional endowment in the Bendigo Zone.
“We are also eagerly anticipating our first drill program at the Viking Project in WA in Q4 (fourth quarter) 2021, where we will be following up on some shallow high-grade gold intersections,” Dorsch said.
“We look forward to working closely with the new entity as it scales up exploration both in Victoria and WA.”