Cyclone Metals Ltd (ASX:CLE) has entered into a binding term sheet for the sale of its non-core gold assets, including the Nickol River Gold Project tenements in Western Australia (100% interest) and the company’s New Zealand assets.
In return, the company will receive a 1% smelter royalty and some A$4 million in cash consideration or shares in either an ASX or New Zealand company from Moosh Moosh Limited, a British Virgin Isles-registered company.
Dedicating resources to Block 103
"This sale of non-core assets illustrates our commitment to the development of our world-class iron ore project Block 103; whilst ensuring that our investors retain exposure to the upside of these gold assets via a royalty stream and/or equity stake,” Cyclone Metals CEO Paul Berend said.
“Both Block 103 and these gold assets will benefit from a dedicated management team and board.”
Just last month, CLE produced a huge maiden resource at Block 103 of 7.2 billion tonnes, containing 29.2% total iron and 18.9% magnetic iron – based solely on the Greenbush zone, which accounts for only a quarter of the project’s mineralised area.
Given the high potential of the project, the company intends to devote all its energy to developing it further.
The other conditions set out in the term sheet include due diligence completed by both parties no later than September 29, 2023, and a payment from Moosh Moosh to Cyclone of A$200,000 to maintain the tenements in good order during the due diligence period.
The following projects and tenements are included in the sale:
- Tenements of the Nickol River Project area;
- Tenements on the North and South Islands of New Zealand;
- Longwood Range Gold Copper PGE Project;
- Mareburn Gold Project;
- Macraes South Gold Project;
- Drybread – Waikerikeri Gold Project, and
- Muirs Gold Project.