Emmerson Resources Limited (ASX:ERM) has been up as much as 50% today after entering a strategic alliance with NT Bullion Ltd for the Northern Project Area (NPA) at the Tennant Creek Mineral Field in the Northern Territory.
NT Bullion will invest $2 million in Emmerson shares at a minimum of 14 cents per share, representing a premium of 100% to the 5-day VWAP.
The first tranche of shares will raise around $200,000 and the second tranche will raise around $1.8 million, with the completion of both tranches of the placement due by May 31, 2020.
Formation of an exploration earn-in and joint venture will also see NT Bullion fund the next $5 million of NPA exploration.
This will include an advanced payment of $1 million and the refund of exploration costs of about $400,000 pertaining to the last drill program at Emmerson's high-grade Mauretania gold discovery.
Emmersons managing director Rob Bills said: “We welcome NT Bullion as a new shareholder and partner at Tennant Creek following the formation of this new strategic alliance.
“This multifaceted deal over the Northern Project Area augments the existing alliance with Territory Resources over the Southern Project Area and is another boost for the local Tennant Creek economy.”
“For Emmerson shareholders, it provides a low-risk pathway to accelerate commercial production from a potential suite of new mines in the Northern Project Area.
“The premium paid by NT Bullion for their Emmerson shares reflects both their confidence in the future success of the strategic alliance as well as their acknowledgement of the proprietary knowledge and relationships that Emmerson hold in relation to the Tennant Creek Mineral Field.”
Shares have been up more than 50% to an intra-day high of 11 cents.
Exploration earn-in and JV[hhmc]
The exploration earn-in and JV aims to accelerate the discovery of new deposits and extensions to existing gold, cobalt and copper projects, including Mauretania, Jasper Hills, Hermitage, Golden Slipper, Marathon and Troy.
Emmerson will receive a 12% gross revenue gold royalty from the Mauretania and Jasper Hills projects, plus 25% profit share of associated cobalt and copper, as well as a 25% profit share from any other mine developed within the NPA in exchange for NT Bullion undertaking the development, mining and processing.
Bills said: “This strategic alliance builds upon our emerging gold royalty business which aims to generate funding for ongoing exploration programs both in Tennant Creek and NSW.”
“The exploration JV sees Emmerson remain the operator and manager plus retain the ownership of the underlying leases during the $5 million earn-in by NT Bullion.”
Map of the Emmerson Tennant Creek tenements showing the area (purple) of the two new JVs with NT Bullion.
Peko processing option[hhmc]
NT Bullion (through an associate ICA Mining Services Pty Ltd), has an agreement with Elmore Ltd (ASX:ELE) aiming to establish a portable modular mill at the Peko site which provides an independent processing option for any projects within the NPA, including the recent discovery at Mauretania.
Bills said: “Elmore is seeking to establish a modular portable mill in the Tennant Creek region to process the Peko tails.
“According to NT Bullion, this mill is expected to be commissioned in late 2020, estabRead More – Source
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