KalNorth Gold Mines Ltd (ASX:KGM) has signed an agreement with UK listed company, Keras Resources plc (LON:KRS) to develop the Lindsays Project located 70 kilometres northeast of Kalgoorlie.
Keras has an exclusive option to mine the current resource of 215,000 ounces of gold at Lindsays, 100%-owned by KalNorth.
The deposit was mined in early 2013 for six months before a deteriorating gold price resulted in a shutdown. The current uptick in the AUD gold price has reinvigorated interest in mining.
Lindsays is an open pit mining prospect while Parrot Feathers Deposit is an underground operation.
Keras has two months of the execution of the HoA, to submit a final plan for the Open Pit Mining Proposal operations to KalNorth.
Keras will be responsible for the management and handling of all mining, ore haulage and milling.
Profit split after deducting royalties, will be on a 51% / 49% for KalNorth and Keras respectively for that part of the profit derived from gold sales at A$1,600 or less per ounce. At a higher gold price than that, the incremental profit above $1,600 will be 30% and 70% for KalNorth and Keras.
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