Adelong Gold’s Lauriston Buy Raises Questions on Exploration Risks and Royalty Impact
Adelong Gold has locked in a binding agreement to acquire the Lauriston Gold Project, boasting exceptional high-grade gold mineralisation adjacent to the world-class Fosterville Mine. The acquisition, backed by a $3 million capital raise, positions Adelong to rapidly expand its Victorian gold portfolio.
- Binding agreement to acquire 100% of Lauriston Gold Project from Great Pacific Gold
- Lauriston adjacent to Agnico Eagle’s Fosterville Mine with high-grade Comet discovery
- Notable drill results include 8m at 104 g/t Au and 2m at 413 g/t Au
- Capital raise of approximately $3 million to fund acquisition and exploration
- Acquisition includes upfront cash, deferred payments, shares, and a 2% NSR royalty
Strategic Acquisition in Victoria’s Gold Heartland
Adelong Gold Limited (ASX:ADG) has taken a decisive step to bolster its Victorian gold assets by executing a binding agreement to acquire the Lauriston Gold Project from Great Pacific Gold Corp. Situated immediately adjacent to Agnico Eagle’s renowned Fosterville Mine, Lauriston offers a rare opportunity to tap into a prolific gold district with proven high-grade mineralisation.
The Lauriston Project covers a substantial 28,700-hectare landholding within the Bendigo Zone, a region famed for its rich gold endowment. The project’s standout feature is the Comet discovery, where drilling has revealed spectacular grades including an 8-metre intercept at 104 grams per tonne (g/t) gold, highlighted by a 2-metre section grading an extraordinary 413 g/t Au. These results underscore the potential for Lauriston to host significant high-grade deposits analogous to those at Fosterville.
Geological Parallels and Exploration Upside
Lauriston’s mineralisation is hosted within the Comet Anticline and the west-dipping Comet Fault Zone, a structural setting closely comparable to the Fosterville Fault that hosts the Swan Zone. Both share similar host rocks and epizonal gold-antimony mineralisation styles, suggesting a fertile geological environment. Despite this, modern exploration at Lauriston has been limited, with only 3,200 metres drilled over the past two years, leaving significant upside for systematic drilling and resource definition.
Recent soil geochemistry has delineated a gold-antimony trend extending over 4.5 kilometres, linking the Comet and Trojan prospects and hinting at district-scale mineralisation potential. Historical mining at Lauriston produced approximately 233,000 ounces at an exceptional average grade of 20.7 g/t Au from shallow depths, reinforcing the project's high-quality credentials.
Funding and Acquisition Terms
To support the acquisition and subsequent exploration, Adelong Gold has secured binding commitments for a $3 million placement from professional and sophisticated investors, including participation from Chairman Mena Habib. The capital raise will fund the Lauriston acquisition, exploration drilling at Lauriston and the Apollo Gold Project, and working capital needs.
The acquisition consideration includes an upfront cash payment of $500,000, completion shares valued at $750,000 (subject to shareholder approval), deferred cash payments totaling $2 million over 18 months, deferred shares worth $750,000, and a production milestone payment of $2 million upon first gold production. Additionally, Great Pacific retains a 2% net smelter return royalty on future production, ensuring ongoing exposure to Lauriston’s success.
Looking Ahead: Exploration and Growth Potential
Adelong Gold’s Managing Director, Ian Holland, emphasised the strategic importance of the acquisition, highlighting Lauriston’s immediate growth pipeline and the opportunity to rapidly advance exploration. The company plans to finalise drill targeting to extend high-grade mineralisation at Comet, progress permitting and approvals, and test regional targets along the Comet-Trojan structural corridor.
This acquisition complements Adelong’s existing Victorian portfolio, including the Apollo Gold Project, and its flagship Adelong Goldfield Project in New South Wales. With a strengthened balance sheet and a clear exploration roadmap, Adelong is well-positioned to unlock value from Lauriston’s untapped potential and enhance its standing in Australia’s competitive gold sector.
Bottom Line?
Adelong Gold’s Lauriston acquisition marks a pivotal expansion with high-grade promise, setting the stage for a transformative exploration campaign.
Questions in the middle?
- How will upcoming drilling results at Lauriston influence Adelong Gold’s resource estimates and valuation?
- What are the potential risks and timelines associated with regulatory approvals and shareholder consent for the acquisition?
- How might the 2% NSR royalty and deferred payments impact Adelong’s long-term project economics and cash flow?