Great Divide Mining’s subsidiary has signed a binding term sheet with Native Mineral Resources to form a joint venture aimed at mining and processing gold ore from the Yellow Jack site, marking a key step towards production and cash flow.
- Binding term sheet signed between GDM Yellow Jack Pty Ltd and Native Mineral Resources Holdings
- Joint venture to mine Yellow Jack gold ore and process it at NMR’s Blackjack Mill
- Profits shared equally after cost recovery between partners
- Agreement advances GDM’s transition from explorer to producer with near-term cash flow
- Subject to due diligence, shareholder approval, and formal agreements
Strategic Partnership Formation
Great Divide Mining Ltd (ASX – GDM), through its wholly owned subsidiary GDM Yellow Jack Pty Ltd (GYPL), has taken a significant step forward by entering into a binding term sheet with Native Mineral Resources Holdings Limited (ASX – NMR). This agreement sets the stage for a joint venture focused on extracting gold ore from the Yellow Jack site and processing it at NMR’s Blackjack Mill in Queensland.
The joint venture, to be unincorporated, will see GYPL responsible for mining and delivering ore, while NMR will handle processing and sales. Profits will be split evenly after each party recovers its costs, reflecting a balanced partnership designed to leverage each company’s strengths.
Advancing from Exploration to Production
This collaboration marks a material advancement for GDM, which has long positioned itself as an explorer with ambitions to become a cash-flow generating miner. CEO Justin Haines emphasised the strategic importance of the deal, noting that it enables GDM to bring a second project online and generate near-term revenue while conserving shareholder capital.
The Yellow Jack Project is poised to accelerate development, with GDM moving quickly to complete mining and environmental studies and secure the necessary mining lease and environmental approvals. Once these are in place, mining operations can commence, feeding ore into the Blackjack Mill, which NMR recently refurbished and is ramping up to steady production.
Operational and Financial Framework
The joint venture agreement includes detailed terms ensuring transparency and operational clarity. Both parties will maintain open-book accounting of their respective costs, with GDM covering mining and haulage expenses, and NMR responsible for processing and sales costs. A Joint Venture Committee will oversee strategic decisions, meeting regularly to manage the project’s progress.
Importantly, the joint venture will not involve intermingling of assets, preserving each company’s ownership while collaborating on the project. The agreement also includes termination rights and dispute resolution mechanisms, underscoring a professional and structured approach to partnership governance.
Broader Implications and Next Steps
For GDM, this joint venture aligns with its broader portfolio strategy, which includes other exploration projects such as the Adelong Venture, Cape, and Devils Mountain. The deal with NMR offers a pathway to de-risk and accelerate Yellow Jack’s development without overextending capital resources.
Looking ahead, the joint venture remains subject to successful due diligence, shareholder approval, and the execution of definitive agreements. Market watchers will be keen to see how quickly these milestones are achieved and how the partnership translates into production and cash flow.
Bottom Line?
This joint venture could be the catalyst that propels Great Divide Mining from exploration into steady gold production and revenue generation.
Questions in the middle?
- What will due diligence reveal about the viability and scale of the Yellow Jack ore body?
- How soon can mining leases and environmental approvals be secured to start operations?
- What is the expected timeline for ramping up production and generating cash flow?