Snowden consultants are currently preparing a JORC technical report on the Avoca and Bailieston projects in Victoria after ECR subsidiary Mercator Gold Australia struck a deal with Currawong Resources.
The latter has identified an opportunity at Avoca to reprocess dumps to recover gold, with potential for the sale of by-products (gravel and sand) as construction material.
Early studies show this could generate relatively near term revenue 12 -24 months from today at less than A$1mln.
Both projects lie less than 200km from the Victorian state capital Melbourne, with good road access, and are in the major orogenic Lachlan Fold Belt (LFB).
The Fosterville gold mine, owned by Toronto- listed Newmarket Gold is some 20km to the west of the Bailieston project, and is currently the largest producing gold mine in Victoria.
It recently celebrated the production of its one millionth ounce of gold.
Mandalay's Costerfield gold-antimony mine is 30km southwest of the Bailieston project.
To pay for it, ECR must pay up to A$250,000 worth of its shares, based on certain milestones being reached, and a net profits interest royalty of 20% in respect of mine dumps and 10% in respect of other deposits, capped at A$3.5mln.
Generating near term revenue would be advantageous to the ECR subsidiary since it had estimated tax losses of approximately A$66 mln as at June 30 last year, which may be available, subject to certain conditions to reduce its future taxable profits.