Gateway Mining Limited has agreed to acquire Strickland Metals’ Yandal Gold Project for $45 million in shares, adding a 400,400-ounce inferred gold resource to its portfolio. The acquisition, pending shareholder approvals, positions Gateway for significant exploration and development in Western Australia’s prolific goldfields.
- Binding agreement to acquire Yandal Gold Project for $45 million in Gateway shares
- Yandal Project hosts 400,400 ounces of inferred gold resource under JORC 2012 standards
- Initial focus on advancing Mining Licence application and drilling intrusive-related targets
- Convertible preference shares issued to Strickland shareholders with planned in-specie distribution
- Gateway well-capitalised with $13.6 million in cash and liquid securities for exploration
Strategic Acquisition Expands Gateway’s Gold Footprint
Gateway Mining Limited (ASX, GML) has entered into a binding agreement to acquire the Yandal Gold Project from Strickland Metals Limited (ASX, STK) for $45 million in Gateway shares. This transaction, subject to shareholder approvals from both companies, marks a significant expansion for Gateway into a highly prospective region of Western Australia’s goldfields.
The Yandal Gold Project boasts a JORC 2012 Inferred Resource of 8.17 million tonnes at 1.52 grams per tonne gold, equating to approximately 400,400 ounces of gold. This resource provides a robust platform for Gateway to pursue further exploration and development, complementing its existing Montague and Barrelmaker projects near Sandstone.
Focus on Mining Licence and Exploration Targets
Gateway’s immediate priority at Yandal will be to progress the Mining Licence application for the Horse Well Gold Camp, which Strickland has already initiated. The Horse Well area contains a substantial portion of the resource, including the Warmblood and Palomino deposits. Concurrently, Gateway plans to drill test several high-potential intrusive-related gold targets at Dusk ‘til Dawn later this year or early 2026, aiming to expand the resource base.
Extensive historical and recent drilling data underpin the resource estimates, with over 75,000 metres drilled across the project. Metallurgical testwork indicates high gold recoveries, with gravity and cyanide leach methods achieving up to 88.6% recovery, supporting the project's economic viability.
Innovative Deal Structure and Capital Position
The acquisition consideration will be paid through the issuance of 1.5 billion convertible preference shares (CPS) in Gateway, valued at $45 million based on a recent volume-weighted average price. Approximately 80% of these CPS will be distributed in-specie to existing Strickland shareholders, while Strickland retains the remainder. The CPS will convert automatically into ordinary shares following the distribution, subject to regulatory compliance and shareholder approvals.
Gateway remains well-funded to execute its exploration and development plans, holding approximately $13.6 million in cash and liquid ASX-listed securities as of the March quarter. The company’s board has managed potential conflicts of interest transparently, with key directors abstaining from related votes.
Regional Significance and Future Prospects
The Yandal Gold Project covers 1,780 square kilometres along the eastern flank of the Yandal Greenstone Belt, a region that Gateway describes as underexplored with significant upside potential. The project’s proximity to Northern Star’s Yandal Operations Centre and the Jundee Gold Mine enhances its strategic value.
Gateway’s acquisition also includes the Iroquois Project, located north of Yandal, which is prospective for zinc-lead mineralisation, further diversifying the company’s portfolio.
With shareholder approvals anticipated by August, Gateway is poised to advance the Yandal Project through critical milestones, including mining licence receipt and maiden drilling campaigns, setting the stage for potential resource growth and value creation.
Bottom Line?
Gateway’s acquisition of Yandal marks a pivotal step in its growth strategy, but success hinges on regulatory approvals and exploration outcomes.
Questions in the middle?
- Will Gateway’s planned drilling at Dusk ‘til Dawn confirm significant resource expansion?
- How will the convertible preference shares impact Gateway’s share structure and investor sentiment?
- What is the timeline and likelihood for obtaining the Mining Licence to enable project development?