Strata Minerals Limited Completes Acquisition of Penny South Gold Project
STRATA MINERALS LIMITED. (SMX) Share Update September 2024 Thursday 26th
Strata Minerals Completes Acquisition of Penny South Gold Project
Strata Minerals Limited (ASX: SMX) has announced the completion of its 100% acquisition of the Penny South Gold Project, a significant addition to its West Australian gold exploration portfolio.
Instant Summary:
- Completion of 100% acquisition of Penny South Gold Project.
- Project located in a prime gold district, 550m south of high-grade Penny Mine.
- Penny Mine Project contains 440,000t of ore at 22g/t Au (320,000oz Au).
- Penny South Project includes 2.5km of strike within the Penny West Shear.
- Historic drilling shows significant anomalous gold intersections.
Project Acquisition Details
Strata Minerals Limited, previously known as NickelX Ltd, has completed the acquisition of the Penny South Gold Project (E57/1045). This acquisition significantly enhances Strata's gold exploration portfolio in Western Australia. The Penny South Gold Project is located in a world-class gold district, approximately 550 meters south of the high-grade Penny Mine, which is owned and operated by Ramelius Resources Limited (ASX: RMS).
The Penny Mine Project, comprising Penny West and Penny North deposits, is estimated to contain 440,000 tonnes of ore at a grade of 22 grams per tonne (g/t) of gold, totaling 320,000 ounces of gold. The Penny West mine produced 154,000 tonnes at 18g/t Au (89,000 ounces) in the early 1990s, while the Penny North deposit was discovered by Spectrum Metals Limited and later acquired by Ramelius for over $200 million in 2020.
Geological and Drilling Information
The Penny South Project captures a 2.5km strike extension of the Penny West Shear, which is highly prospective for gold mineralization. Historical drilling at the Penny South Project has encountered various significantly anomalous intersections of gold mineralization. The average depth of historical drill holes is approximately 42 meters, with only 18 holes deeper than 100 meters and 7 holes deeper than 200 meters. Notably, there has been no diamond drilling conducted at the project site.
Strata Minerals is currently reviewing all available data from the Penny South Project and plans to update shareholders in the coming weeks. The company believes that the project has not been fully tested at depth and is eager to unlock its potential value.
Acquisition Terms and Future Plans
The acquisition consideration included a payment of A$60,000 in cash and 3,000,000 shares at a deemed price of $0.02 per share, totaling $60,000. Additionally, a deferred cash consideration of A$500,000 is to be paid upon achieving at least 50,000 ounces of gold resource with a grade of at least 1g/t within five years. An additional $500,000 will be paid for every subsequent 50,000 ounces of gold resource with a grade of at least 1g/t.
The company will also assume an existing 1% royalty on the Penny South Project tenement. Strata Minerals plans to utilize a similar exploration strategy to that used by Spectrum Metals at the Penny North deposit, focusing on deeper drilling beneath cover to test targets at depth.
The acquisition of the Penny South Gold Project is a strategic move for Strata Minerals, positioning the company to significantly enhance its gold exploration capabilities in Western Australia. The proximity to the high-grade Penny Mine, operated by Ramelius Resources, adds considerable value to the acquisition. This move is likely to positively impact Strata Minerals' stock as investors recognize the potential for significant gold discoveries and increased resource estimates.
Investor Reaction:
Analysts are likely to view this acquisition favorably, given the strategic location and historical success of nearby gold projects. The potential for discovering high-grade gold deposits at depth could attract positive investor sentiment. However, the actual impact on the stock price will depend on the results of future exploration activities and the company's ability to effectively develop the project.
Conclusion:
Investors should keep an eye on Strata Minerals' updates regarding the Penny South Gold Project and monitor the progress of exploration activities. The successful development of this project could lead to significant value creation for shareholders. Stay informed and consider the potential long-term benefits of this strategic acquisition.