Why Kula Gold Sold Westonia for $1.5M and What’s Next at Mt Palmer
Kula Gold has agreed to sell its Westonia Project to Forrestania Resources for an upfront $500,000 plus a $1 million contingent payment tied to resource discovery. This move sharpens Kula’s focus on advancing its Mt Palmer Gold Project.
- Sale of 100% owned Westonia Project to Forrestania Resources
- Initial cash payment of $500,000 with settlement in 7 days
- Contingent $1 million payment upon discovery of 100,000 ounces JORC-compliant gold resource
- Divestment aligns with Kula’s strategic focus on Mt Palmer drilling program
- Agreement subject to due diligence and commercial terms
Strategic Asset Sale
Kula Gold Limited has taken a decisive step to streamline its portfolio by selling its 100% owned Westonia Project to Forrestania Resources Limited. The deal, announced on 23 September 2025, involves an upfront cash payment of $500,000, with a further $1 million contingent on the discovery of a JORC-compliant mineral resource of at least 100,000 ounces of gold or equivalent. This structure reflects a cautious optimism about the project's potential while securing immediate capital.
Terms and Conditions
The sale agreement covers four exploration licences within the Westonia region, a historically significant gold area. Forrestania Resources will take over these tenements subject to due diligence and standard commercial conditions. The initial payment is expected to settle within seven days, providing Kula with a swift cash injection. The contingent payment hinges on future exploration success, aligning incentives for Forrestania to aggressively pursue resource definition.
Focus on Mt Palmer
Kula’s divestment of Westonia is part of a broader strategic realignment to concentrate resources and management attention on its Mt Palmer Gold Project. Diamond drilling is actively underway at Mt Palmer, signaling the company’s commitment to advancing this asset. By shedding Westonia, Kula aims to sharpen its operational focus and potentially accelerate development timelines at Mt Palmer.
Implications for Forrestania
For Forrestania Resources, acquiring the Westonia Project represents an opportunity to expand its footprint in a prolific gold region. The contingent payment clause underscores Forrestania’s confidence in the exploration upside, while also mitigating upfront risk. Market watchers will be keen to see how Forrestania prioritizes exploration and whether it can unlock significant resources to justify the additional payment.
Looking Ahead
As Kula Gold refocuses on Mt Palmer and Forrestania embarks on its new Westonia tenure, both companies face pivotal moments. The success of this transaction will depend on exploration outcomes and the ability to deliver shareholder value through disciplined project advancement.
Bottom Line?
Kula’s sale of Westonia crystallizes its strategic pivot, but the real test lies in exploration success ahead.
Questions in the middle?
- Will Forrestania Resources confirm a 100,000-ounce JORC-compliant resource at Westonia?
- How will the sale proceeds accelerate Kula’s Mt Palmer drilling and development plans?
- What are the key risks Forrestania faces in unlocking value from the Westonia tenements?