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Siren Gold Limited (ASX: SNG) (Siren or the Company) is pleased to announce that it has entered into a definitive agreement regarding a A$20m transaction for a sale of the Reefton Project.
Highlights
- Siren has entered into a definitive agreement with Canadian listed RUA Gold Inc. (CSE:RUA) for the sale of the Reefton Project to consolidate the Reefton Goldfield.
- This transaction will create the largest gold explorer on the Reefton Goldfield on the West Coast mining district of New Zealand’s South Island.
- The transaction will create the largest tenement package of 1,242km2, on the high-grade Reefton Goldfield that has produced +2Moz at 15.8 g/t Au.
- The proposed transaction is for RUA to acquire Siren’s 100% owned subsidiary, Reefton Resources Pty Ltd (NZ), with the key outcomes being:
- RUA to acquire the Reefton Project for A$20m, comprising A$2m in cash and A$18m in RUA shares.
- Siren Chairman Mr Brian Rodan will join the RUA Board on completion of the transaction.
- Acquisition price of A$45/oz, based on Reefton’s current 444,000 oz inferred Mineral Resource Estimate (MRE)2.
- Post transaction, Siren will hold approximately 30.2% of RUA’s common shares outstanding, maintaining a significant interest in the Reefton project as well as acquiring an interest in the high-grade Glamorgan Project in the North Island of New Zealand.
- Siren will retain the Sam’s Creek Project with a current MRE of 824koz @ 2.8g/t Au and remain listed on the ASX (Refer Table 1).
- The total consideration equates to approximately A$0.10 per issued share of Siren, which represents a 28.4% premium over Siren’s closing share price on 12 July 20241.
- Post transaction Siren will have cash and investments of over $20m, representing 10cps per SNG share, and it will focus on the Sam’s Creek Project, which currently has a MRE of 824koz of gold and a pending mining permit application, whilst shareholders will remain invested in Reefton through the RUA shareholding.
- The transaction is subject to customary conditions and approvals such as shareholder and regulatory approvals and is expected to close in Q4 2024.
Consolidation of the Reefton Goldfield
Siren Gold Limited (ASX: SNG) (“Siren” or the “Company”) is pleased to announce that it has entered into a definitive agreement dated 14 July 2024 (the “Definitive Agreement”) with Reefton Acquisition Corp., a wholly owned subsidiary of Canadian Securities Exchange listed RUA Gold Inc. (“RUA”), whereby RUA will acquire 100% of the capital of Reefton Resources Pty Ltd. (“Reefton Resources”), a wholly owned subsidiary of the Company, for A$20 million in cash and shares of RUA (the “Transaction”). Reefton Resources owns 100% of the tenements that comprise Siren’s Reefton Project.
The Transaction, expected to be completed in November 2024, provides Siren with a cash payment of $2 million and $18 million in common shares of RUA (the “RUA Shares”). Following completion of the Transaction, Siren would own approximately 30.2% of the current estimated issued and outstanding RUA Shares. The Transaction eliminates the need for a potentially dilutive near-term equity raising to continue exploration at Reefton, while retaining continued ownership and upside in the expansion and future development of the Reefton Project.
The Transaction will establish RUA as the dominant landholder in the region, with approximately 1,242km2 of tenements in the historical Reefton Goldfield. Following completion of the Transaction, RUA will be well positioned as the pre-eminent gold explorer on the Reefton Goldfield in New Zealand, with a pro forma market capitalisation of approximately C$60 million (A$64.9 million)2. Combining properties and exploration activities in the Reefton Goldfield provides a number of strategic benefits, including:
i. Consolidation of the tenement package, creating the dominant Reefton Goldfield explorer
ii. Significant project synergies for mine development and a central processing hub
iii. Larger exploration programs with more consistent news flow
iv. Combines mine permitting and expedites eventual project construction
v. Combined company best positioned to further consolidate the Reefton Goldfield
vi. Siren retains upside in exploration and development of a consolidated Reefton
vii. Siren will be able to focus on exploration and development at Sams Creek
viii. RUA will be focused on exploration and development of the combined Reefton belt
Figure 1: Tenement map of the Reefton Goldfield district.
Siren Managing Director and CEO, Victor Rajasooriar commented:
“Siren’s vision for the Reefton region has been to create a significant high grade gold producer with a central processing facility fed by numerous underground mines. This transaction is a significant step in realising this vision and a great outcome for Siren shareholders. Siren can focus on the multi-million-ounce potential at Sams Creek while RUA can continue to explore the consolidated Reefton Project. This transaction is at a ~3.8x premium EV/ Resource multiple compared to Siren’s current share price and will enable Siren to fast-track Resource growth at Sams Creek, while RUA can fast-track gold and antimony Resource growth at Reefton. New Zealand is open for business and this partnership with RUA allows Siren to fast-track exploration and development of its asset base.”
RUA CEO, Robert Eckford commented:
“The transaction between RUA and Siren Gold is a significant step in RUA becoming the largest tenement holder of the highly prospective Reefton Goldfield district, home to host rocks with high-grade gold and antimony. This transaction is a natural fit for our portfolio and creates the opportunity for real synergies, which, in combination with local knowledge, sets us for a rapid re-rating from further exploration success and resource delineation across the combined land package.”
Click here for the full ASX Release
This article includes content from Siren Gold, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
SNG:AU
41m at 2.01g/t Au from Surface at Murchison South Gold Project
HIGHLIGHTS
- RC drilling from the first two (2) holes at the Murchison South gold project has intersected high grade gold, providing initial validation of historical drilling results
- Significant assay results include (down hole widths):
- 25PFRC001 (Hole 1)
41m @ 2.01 g/t from surface; including 15m @ 2.01 g/t from 2m, and
5m @ 10.01 g/t from 36m
- 25PFRC002 (Hole 2)
22m @ 0.70 g/t from 33m; including 10m @ 1.05 g/t from 33m, and
1m @1.61 g/t from 45m
- 25PFRC001 (Hole 1)
- A total of fourteen holes were drilled for 1463m at an average depth of 104m, at the Blue Heaven deposit
- Results from the first two drill holes align with the interim mineralisation analysis completed by Mining Plus, with the holes having intercepted the main rock types and showing a well- defined weathering profile
- Assays from the remaining 12 holes are due next week
Commenting on the results CEO Jeremy Bower said:
“These fantastic initial results give us a great start towards validation of the historic drilling and resource model at our Blue Heaven deposit. We have hit some high-grade shallow gold intervals, which align with the model, which is very encouraging, and we now eagerly await assays from the remaining 12 holes so we can get a complete understanding of our project.”
Figure 1: Murchison South Gold Project showing the Blue Heaven deposit with current and historic drilling.
The drill program comprised 14 RC holes for a total of 1463m at an average depth of 104m and collection of 1588 samples for assay. This announcement relates to the first two (2) drill holes only (Refer to JORC Table 1 Appendix A for full results and collar table from holes 25PFRC001 & 25PFRC002).
Figure 2: Cross Section.
The weathering zone is not intercepted in this cross-section but appears further south from Section 3 (Figure 1). Cross-Section 1 (Figure 2) displays multiple high-grade zones that broadly align with the existing model. Low-grade zones (yellow) envelop the high-grade mineralisation and correlate well with the new drilling.
Once all the drilling results have been received, Mining Plus will have sufficient data to interrogate the results before integrating them into their model. This will guide the next steps in optimizing pit designs at the Blue Heaven deposit and additionally will help determine the number and locations of planned diamond drill holes, which will be the source of sample material for the required metallurgical testing and geotechnical analysis.
Key Next Steps
- Receipt of remaining assay results
- Mining plus continue their independent mining review
- Metallurgical test work
- Negotiations with mining contractors and processors
Click here for the full ASX Release
This article includes content from Reach Resources, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
