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Beacon Minerals sells Barlee gold mining lease to fund acquisitions and exploring remaining leases

Beacon Minerals sells Barlee gold mining lease to fund acquisitions and exploring remaining leases

Beacon Minerals (ASX: BCN) has secured funds to acquire new assets and further exploration of its Barlee Gold Project tenements in Western Australia after selling Mining Lease ML 77/1254 at Barlee to Ramelius Resources for A$4 million and a royalty on any gold produced there.

The deal will bring Beacon’s cash reserve up to about A$5 million, allowing it to continue exploration of several prospective targets at its remaining Barlee tenements, which cover 388 square kilometres, as well as continue current advanced negotiations on project opportunities which are located in geological regions where existing large scale gold resources are present.

Royalty on gold produced from ML 77/1254 is A$80 per ounce for the first 40,000 ounces, A$160 per ounce for gold produced from 40,001 to 100,000 ounces and a 2% interest on any gold produced above 100,000 ounces.

This will give Beacon total royalty of A$12.8 million on the first 100,000 ounces of gold produced from the licence.

Beacon also holds listed equities in Consolidated Tin Mines worth about A$900,000.

ML 77/1254 forms the basis of a mining proposal Beacon had submitted to the Western Australian Department of Mines in November for a initial optimised mining resource of 172,000 tonnes at 7.5 grams per tonne, or 42,000 ounces of gold.

However, Beacon decided to sell the lease after establishing there were insufficient resources to support a stand alone processing facility while options for toll treatment at existing operations and potential operations coming on stream provided poor financial returns.

Ramelius’ offer was assessed to be the best in regards to the maximisation of shareholder wealth and the gold producer already has an existing process plant at Mt Magnet with plans to start mining at Barlee this year.

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