High Peak Grants Massive Metals Option to Buy Admiral Bay Royalty for Up to A$2 Million

High Peak Monetises Admiral Bay Royalty with Call Option Deal

High Peak Royalties Limited (ASX:HPR) has taken a pragmatic step to monetise its royalty rights over the Admiral Bay zinc/lead project in Western Australia by granting Massive Metals Pty Ltd an exclusive 12-month call option. Massive Metals has paid an upfront A$50,000 fee for the option to acquire the royalty rights for A$1.2 million, with the possibility to extend the option for a further year by paying an additional A$200,000, pushing the potential acquisition price to A$2 million.

This arrangement provides High Peak with immediate cash inflow while preserving upside potential if Massive Metals exercises the option or opts for the extension. The company’s board views the transaction as a positive outcome, balancing near-term liquidity with the chance of a larger monetisation event. It also establishes a clear commercial framework for the future sale of the royalty rights.

Royalty Complexity Clouds Admiral Bay Development

The Admiral Bay Project hosts one of the world’s largest undeveloped zinc and lead deposits, with a JORC 2012 Mineral Resource of 170 million tonnes at 7.5% zinc equivalent, including 12.8 million tonnes of contained zinc equivalent. However, High Peak notes that multiple private royalties over the project collectively inflate costs and challenge feasibility.

Massive Metals, which acquired Admiral Bay recently, is actively pursuing consolidation or removal of these royalties to improve project economics and clear a path to development. High Peak’s royalty is among those royalties, and the call option deal aligns with Massive Metals’ strategy to gain better control over the project’s cost base.

Given the royalty’s limited standalone value if the project remains encumbered by multiple royalties, the transaction offers High Peak a practical exit route from a non-core asset. This move echoes High Peak’s recent strategic actions, including the NorthStar deal boosting asset value, which also involved monetising royalty interests to strengthen the company’s portfolio and cash position.

Massive Metals’ Ambitions for Admiral Bay

Massive Metals is a Perth-based mineral explorer and developer focused on advancing Admiral Bay. The company plans to leverage extensive historic studies, significant exploration upside, and upcoming drilling programs to push the project closer to development. Securing options over royalties like High Peak’s is a tactical move to consolidate financial interests and reduce the royalty burden that has hampered the project’s feasibility.

The call option deed’s structure, allowing Massive Metals to extend exclusivity for another year, provides flexibility to navigate the complex royalty landscape while pursuing project advancement. For High Peak, this deal fits a broader pattern of selectively realising value from its diverse royalty portfolio, which spans gas, hydrogen, and minerals across Australia and the US.