Through a newly formed joint venture, Newmont Mining will gain a 70-percent stake in Nova Minerals’ Officer Hill gold project in Australia.
The project, which was previously owned in full by Nova, will now be held 30 percent by Nova and 70 percent by Newmont Tanami, a wholly owned subsidiary of Newmont.
According to a press release from Nova, the two companies will establish an operating committee to make headway on Officer Hill, while Newmont will manage the project.
“The decision by Newmont to proceed with the joint venture agreement is a ringing endorsement of the quality of the Officer Hill gold project and its exploration upside in the Tanami region of Northern Territory, particularly with the project’s close proximity to the 400Koz per year Tanami gold mine and located within the ~13 million ounce Tanami endowment,” Nova Managing Director Avi Kimelman said.
“Newmont’s commitment to the joint venture brings valuable technical expertise and insights to the project,” he added.
Similar to the Tanami gold mine, owned by Newmont, Officer Hill is considered highly prospective for its potentially steeply plunging shoots.
The full area of the lease for Officer Hill covers just over 206 square kilometers and is located 34 kilometers southwest of the Callie gold mine, also operated by Newmont. Callie had a gold resource of 5.6 million ounces as of year end 2015 and puts out 419,000 ounces of gold a year.
To earn its 70-percent stake in the asset, Newmont had to spend $500,000 over three years, $100,000 of which was spent in the first year.
Historic exploration at Officer Hill has found sporadic mineralization through drilling, including 4 meters at 4.64 g/t, several short intervals of 1 to 4 g/t and a number of wide intercepts at 0.1 to 1 g/t. A proposed 2018/2019 exploration program for Officer Hill will be separately released by Nova.
As of 1:30 p.m. EST on Monday (July 30), Nova’s share price was sitting at AU$0.027.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.