JOHANNESBURG (miningweekly.com) - ASX-listed companies Westgold Resources and S2 Resources (S2R) have entered an agreement, whereby Westgold would acquire S2R's interest in the Polar Bear project, its 80% interest in the Eundynie joint venture and the Norcott project, in Western Australia.
The company would take over all the shares in S2R's wholly-owned subsidiary Polar Metals for A$9-million, with Westgold paying A$3-million in cash and alloting it four-million fully paid ordinary shares which are subject to a voluntary six-month escrow period.
S2R would retain rights to nickel in the titles.
Westgold MD Peter Cook said this package of tenements and resources fits nicely into the company's Higginsville project. "The discovery of these deposits by S2R and the significant discovery of the Invincible mine by Gold Fields to the north has opened this region as a new province of gold discoveries in stratigraphy previously under-evaluated for its gold potential."
Cook added that the Polar Bear project abutted its two-million-ounce Higginsville project and provided near-time ore sources for its plant from mining of the Baloo deposit and further exploring with a view to development of the nearby Monsoon, Bindy, Nanook and Ear Lobe prospects.
The Polar Bear project spans an area of 151 km2, located between Higginsville and Norseman, and is surrounded by the major multimillion-ounce gold camps of Norseman, St Ives, Higginsville and the Chalice.
Most of the area is unexplored or ineffectively explored owing to it being largely concealed by the shallow salt lake sediments of Lake Cowan and the sand dunes of the Polar Bear peninsula.
The Polar Bear project contains a number of shear zones of the type that host gold mineralisation elsewhere in the district, and also contains southern extensions of the Kambalda and Widgiemooltha ultramafic stratigraphy, which hosts a number of world class nickel sulphide mines along strike to the north.
Meanwhile, Westgold said that Triton Minerals' intention to acquire certain lithium assets and royalties in Western Australia had been cancelled.
"The transaction was conditional on a number of conditions precedent being satisfied including legal, technical and commercial due diligence, the execution of third party agreements, Westgold's satisfaction with tax advice and shareholder approval from Triton shareholders.
"Despite the potential for lithium in the tenure, the management of both Westgold and Triton have mutually agreed not to proceed with the transaction given a satisfactory and timely completion appears unlikely," Westgold said.
The company did not receive favourable taxation advice for itself and its shareholders on the event of a sale to Triton. However, it said it would continue to investigate the best option to realise value for its shareholders from its lithium interests.