How Aurum’s New JV Could Unlock 320km² of Gold Potential at Boundiali
Aurum Resources has secured a joint venture to earn up to 80% interest in two new exploration permits adjacent to its 1.6Moz Boundiali Gold Project in Côte d'Ivoire, significantly expanding its landholding and growth potential.
- Earn-in JV agreement for two contiguous exploration permits totaling nearly 320 km²
- Potential to increase interest up to 80% through staged drilling and expenditure milestones
- Equity incentives to vendor Encore Resources via shares and options
- Permits strategically located between existing Boundiali tenements
- Clear ownership and funding structure outlined for future mining operations
Strategic Expansion of Aurum's Gold Footprint
Aurum Resources Limited (ASX: AUE) has taken a decisive step to bolster its presence in Côte d'Ivoire’s prolific Boundiali gold belt. Through its wholly owned subsidiary Plusor Global Pty Ltd, Aurum has entered into a joint venture agreement to earn up to an 80% interest in two contiguous exploration permit applications, collectively known as the Encore JV permits. These permits cover nearly 320 square kilometres and are strategically positioned between Aurum’s existing Boundiali DS and Boundiali South tenements, directly enhancing the footprint of its flagship 1.6 million ounce gold project.
Structured Earn-In with Milestone-Linked Investment
The joint venture agreement is designed with a staged earn-in structure that aligns Aurum’s exploration expenditure with key milestones. Initially, Aurum will earn a 30% interest upon grant of each exploration licence by issuing shares to the vendor, Encore Resources Côte d'Ivoire SARL. To progress to a 51% interest, Aurum must complete 4,000 metres of diamond drilling per permit. Further drilling or a nominal expenditure of US$2.5 million can increase Aurum’s stake to 80%. This approach allows Aurum to manage its investment prudently, scaling exploration efforts based on success.
Vendor Incentives and Future Ownership Dynamics
Encore Resources will receive equity incentives including 4 million Aurum options exercisable at a premium and up to 8 million Aurum shares tied to resource milestones. This ensures strong alignment between both parties as exploration advances. Should mining licences be granted and mining operations commence, Aurum’s subsidiary Plusor will hold an 80% interest, with Encore Resources and the Côte d'Ivoire government each holding 10%. The agreement also includes provisions for funding contributions and potential dilution of interests, reflecting a clear framework for future development phases.
Context Within Aurum’s Broader Portfolio
This JV complements Aurum’s existing resource base, which includes 2.47 million ounces of gold across the Boundiali and Napié projects. The Boundiali Gold Project alone hosts 1.6 million ounces and is situated within a greenstone belt that hosts several large-scale gold mines operated by major companies. Aurum’s ability to deploy eight diamond drill rigs simultaneously positions it well to accelerate exploration and resource definition on these newly acquired permits.
Looking Ahead
With exploration licences still pending grant, Aurum’s next steps will focus on securing these permits and initiating diamond drilling programs to meet earn-in milestones. The company’s strategic expansion via the Encore JV could unlock significant value by potentially increasing the resource base and enhancing the project’s overall economics. Investors will be watching closely as Aurum advances this promising chapter in its Côte d'Ivoire portfolio.
Bottom Line?
Aurum’s Encore JV deal sets the stage for a potentially transformative expansion of its Boundiali gold assets, but exploration success and licence grants remain key hurdles.
Questions in the middle?
- When will the exploration licences for the Encore JV permits be officially granted?
- What initial drilling results can investors expect, and how might they impact resource estimates?
- How will Aurum balance capital expenditure across its expanding portfolio while managing exploration risks?
