Minerals 260's Transformational Acquisition of Bullabulling Gold Project
MI6 (MI6) Share Update January 2025 Monday 13th
Minerals 260 Acquires Bullabulling Gold Project in Transformational Deal
Minerals 260 Limited (ASX: MI6) has announced a significant acquisition of the Bullabulling Gold Project, a major undeveloped gold resource located in Western Australia. This strategic move positions the company for substantial growth in the gold mining sector.
Instant Summary:
- Acquisition of 100% of Bullabulling Gold Project from Zijin Mining Group.
- Bullabulling holds a JORC 2012 Mineral Resource of 60Mt @ 1.2g/t Au for 2.3Moz.
- Acquisition cost of A$166.5 million, including A$156.5 million in cash.
- Project located in infrastructure-rich Coolgardie Region, Western Australia.
- Plans for immediate 80,000m drilling campaign to expand resources.
Acquisition Details
Minerals 260 has executed a binding agreement to acquire the Bullabulling Gold Project from Norton Gold Fields, a subsidiary of Zijin Mining Group. The acquisition includes a 100% stake in Bullabulling Gold Pty Ltd and its subsidiary, Bullabulling Operations Pty Ltd. The project is one of Australia's largest undeveloped gold deposits, with a JORC 2012 Mineral Resource estimate of 60Mt @ 1.2g/t Au for 2.3Moz.
The total acquisition cost is A$166.5 million, comprising A$156.5 million in cash and A$10.0 million in Minerals 260 shares. This represents an acquisition cost of A$74 per ounce of gold, which is considered exceptional value given the project's scale, location, and quality.
Strategic Importance
The Bullabulling Gold Project is located in the world-class mining jurisdiction of Western Australia, approximately 25km south-west of Coolgardie. The area is rich in infrastructure, which supports the company's near-term production goals. The project has a strong foundation for growth, with over 530,000 metres of drilling completed and significant metallurgical test work indicating an average gold recovery of 87% through conventional Carbon-In-Leach processing.
Future Plans
Minerals 260 plans to commence an 80,000-metre drilling campaign immediately after the transaction's completion. This campaign aims to expand the Bullabulling mineral resource further, leveraging the numerous highly prospective targets identified at depth and along strike. The company will fund the acquisition and subsequent development through an equity raise, with Bell Potter Securities Limited and Argonaut Securities Pty Limited appointed as Joint Lead Managers.
This acquisition significantly enhances Minerals 260's resource base, positioning it as a major player in the Australian gold mining sector. The strategic location and scale of the Bullabulling project offer substantial growth potential, likely boosting investor confidence and potentially increasing the company's stock value. The immediate commencement of an extensive drilling campaign underscores the company's commitment to unlocking further value from the project.
Investor Reaction:
Analysts are likely to view this acquisition positively, given the project's scale and strategic location. The acquisition cost per ounce of gold is competitive, and the potential for resource expansion adds further appeal. However, the success of the equity raise will be crucial in determining the project's financial viability and investor sentiment.
Conclusion:
Investors should closely monitor Minerals 260's progress with the Bullabulling Gold Project, particularly the outcomes of the drilling campaign and the equity raise. This acquisition represents a significant growth opportunity for the company, with the potential to deliver substantial returns to shareholders.