Horizon Minerals Limited has executed a binding agreement for the acquisition of a 50 per cent interest in the high-grade Penny’s Find gold project in the Western Australian goldfields for $1.5 million cash from Orminex Limited.
Penny’s Find is located approximately 50 kilometres north-east of Kalgoorlie in the Eastern Goldfields of Western Australia (Figure 1), in close proximity from the company’s 100 per cent owned Kalpini gold project and comprises granted mining lease M27/516 and associated miscellaneous and general purpose leases covering approximately 91 hectares.
Open-pit mining at Penny’s Find was completed in 2018 with 18,350 ounces recovered from the treatment of 140,000 tonnes grading 4.5 grams per tonne (g/t) of gold (Au) with an overall gold recovery of 92.4 per cent.
Empire Resources Limited then commenced work on updating the underground mining resource and assessing mine optimisation and design.
Orminex acquired 100 per cent of the project in May 2019 from Empire and completed further underground mine evaluation and design work, gained statutory approvals for mine development and independent assessment of further drilling required to improve geological confidence and convert current Inferred resources into the Measured and Indicated Category for inclusion in the reserve generation studies.
Horizon outlines that Penny’s Find is a high-grade, underground mining and toll treatment opportunity with near term cash flow potential and longer-term exploration upside which will be included in the consolidated Feasibility Study as a fifth higher-grade satellite operation.
The project has a current JORC 2012 Mineral Resource Estimate of 248,000 tonnes at 7.04g/t Au for 56,000 ounces with 147,000 tonnes at 8.06g/t Au in the Indicated Category .
The company notes that mine development work is well advanced and statutory approvals are in place for underground mining in the first half of 2021 .
Horizon will solely fund the first $1 million in pre-development expenditure with the joint venture partners funding the project on a 50:50 basis thereafter.
A toll treatment agreement is in place at the Lakewood Mill commencing in July 2021.
Horizon states that there is a defined pathway for it to acquire 100 per cent of Penny’s Find through the exclusive right to acquire the remaining 50 per cent on completion of the toll milling contract.
Acquisition and development work will be funded from existing cash reserves of over $15 million.
The agreement remains subject to standard conditions precedent for a transaction of this nature including Ministerial consent, any third party assignments and provision of mining information with Settlement expected in the current quarter .
Horizon Managing Director, Jon Price, said Horizon’s core focus remains firmly set on developing a stand-alone gold production business in the Kalgoorlie and Coolgardie region and the acquisition aligns with this and the company’s strategy of further regional consolidation of advanced development assets in close proximity to core assets.
“Penny’s Find has had considerable work completed in the past, including resource modelling, open-pit mining, processing and environmental studies which enables rapid advancement of the underground deposit. We also see considerable growth potential below the current high-grade resource which remains open at depth,” Mr Price said.
“We look forward to working with the highly experienced Orminex team completing the technical work required to advance the project into development next year initially via toll milling in 2021-2022 for early cash flow generation. Beyond this, the project has the potential to provide further high-grade satellite ore at the proposed standalone plant at Boorara.”
The full announcement can be found here.
 As reported by Empire Resources Ltd to the ASX on 13 December 2017, see also Table 1 and Competent Persons Statement on Page 4 and supporting details and JORC Tables on Pages 9 and 11 in the announcement here.
 See Cautionary and Forward-Looking Statements on Pages 1 and 8 here.