Flynn Gold Ltd (ASX:FG1) has bolstered its gold and battery metals portfolio after exercising an option to acquire a 100% interest in two projects covering 99 square kilometres in northern Tasmania.
These projects - the advanced Firetower Gold and Battery Metals Project and the Warrentinna Gold Project - are currently owned by Greatland Gold PLC (AIM:GGP, OTC:GRLGF).
The Firetower Project is in the prolific Mount Read Volcanic belt, a region known for its rich Volcanogenic Massive Sulphide (VHMS) deposits including globally recognised ones such as Mt Lyell, Rosebery, Hellyer and Henty.
This project showcases promising indications of gold deposits, with previous drilling returning results of 54 metres at 1.36 g/t gold and 17 metres at 5.37 g/t.
Similarly, the Warrentinna Project highlights the presence of an orogenic-style gold system with previous drilling results including 5 metres at 28.93 g/t gold.
Flynn’s endeavours have been backed by the Tasmanian Government through its exploration drilling grant initiative, providing up to $132,000 of co-funding grants for drilling at the Firetower and Warrentinna projects.
The company is finalising its exploration strategy for these projects and looks forward to providing updates on exploration targets and planned exploration in the near future.
“Excellent potential”
Flynn managing director Neil Marston said: “We are delighted to acquire these two gold and battery metals projects in Tasmania.
“Both Firetower and Warrentinna have recorded significant mineralisation to date with excellent potential for further exploration success.
“The two projects strongly complement and enhance Flynn’s existing exploration portfolio in Tasmania, adding advanced drill-ready targets with potential for rapid development to JORC resource status.
“The company has also received strong support from the Tasmanian State Government through its latest round of exploration drilling incentive grants.
Flynn will receive up to $132,000 in grant funds to support our drilling activities on both these newly acquired projects.”
Location of Flynn’s Tasmania projects
Option exercise
Flynn has provided notice to Greatland exercising its option to purchase the Firetower and Warrentinna projects.
The consideration for the purchase consists of an initial consideration of $200,000, to be satisfied by the issue of two million Flynn shares at a deemed price of $0.10/share.
Meanwhile, the deferred consideration includes:
- on the definition of a combined JORC-compliant mineral resource of 500,000 ounces of gold on the projects, Flynn will pay Greatland $500,000 (payable in cash or shares to an equivalent value, at Flynn’s election);
- on the issue of a permit to mine by MRT for any one of the projects, Flynn will pay Greatland a further $500,000 (payable in cash or shares to an equivalent value, at Flynn’s election); and
- Greatland will hold a 1% Net Smelter Royalty on all production from the projects.