Riversgold Limited has significantly expanded its Kalgoorlie Gold Project by acquiring a new tenement, increasing the project area by 170%. This strategic move positions the company for enhanced gold production opportunities in a prolific mining region.
- Acquisition of 100% ownership of tenement P25/2540
- Project size increased by 170% near Northern Zone
- Application for adjacent tenement P25/2848 underway
- Acquisition cost AUD 75,000 excluding GST
- Goldblade retains limited prospecting rights and 2% royalty
Strategic Expansion Near Kalgoorlie
Riversgold Limited (ASX – RGL) has taken a decisive step to enlarge its footprint in one of Australia's most renowned gold regions. The company announced a binding agreement to acquire full ownership of tenement P25/2540, located just 500 metres north of its existing Northern Zone Kalgoorlie Gold Project. This acquisition translates into a substantial 170% increase in the project’s landholding, a move that could materially enhance Riversgold’s exploration and development potential.
The Northern Zone project itself lies approximately 25 kilometres east of the Kalgoorlie 'Super Pit', one of the largest open-pit gold mines in Australia. Expanding the project area in such proximity to a prolific gold mining hub underscores Riversgold’s ambition to capitalize on the region’s rich mineral endowment.
Terms and Strategic Implications
The acquisition deal with Goldblade Corporation Pty Ltd involves a consideration of AUD 75,000 excluding GST. While Riversgold gains full legal and beneficial ownership of the tenement, Goldblade retains the right to prospect for minerals to a depth of 10 metres, with any minerals recovered under this retained interest split 80/20 in favour of Goldblade. Additionally, Riversgold will pay a 2% royalty on all minerals extracted from the tenement, excluding gold recovered by Goldblade under its prospecting rights.
These terms introduce a nuanced dynamic to the project’s future economics, balancing Riversgold’s expanded control with ongoing obligations to Goldblade. Nonetheless, the company’s Technical Director, Ed Mead, highlighted the strategic importance of these tenements, particularly in light of a recent deal with MEGA Resources, suggesting a broader vision for advancing gold production in the area.
Further Growth Prospects
Beyond the acquisition, Riversgold has also lodged an application for an additional tenement, P25/2848, contiguous to the east of its current holdings. This proactive approach to securing more ground indicates a clear intent to build a robust portfolio of exploration assets around the Northern Zone. The company continues to evaluate further opportunities to expand its tenure in this highly prospective region.
With the acquisition expected to complete imminently, Riversgold is poised to accelerate its exploration activities. The expanded project area not only increases the potential resource base but also enhances the company’s leverage in a competitive gold exploration landscape.
Bottom Line?
Riversgold’s expanded Kalgoorlie footprint sets the stage for intensified exploration and potential production growth, but the retained rights and royalties add complexity to future returns.
Questions in the middle?
- How will the retained prospecting rights and royalty impact Riversgold’s long-term project economics?
- What exploration results can investors expect from the newly acquired and applied-for tenements?
- How does this expansion integrate with Riversgold’s recent deal with MEGA Resources?