Ausmon Resources Ltd (ASX:AOA) has signed a binding terms sheet to acquire about 628 square kilometres of prospective cobalt ground across New South Wales and Queensland.
The company’s share price increased 150% during Monday’s trade, closing at 1.5 cents.
Ausmon is acquiring New Base Metals Pty Ltd which owns the Broken Hill Cobalt-Nickel Project in New South Wales and two cobalt-nickel projects in Queensland.
The company's new acquisition in New South Wales is in close proximity to the Thackaringa Cobalt Project where Cobalt Blue Holdings (ASX:COB) recently revealed a major cobalt resource upgrade.
Recent exploration by Cobalt Blue and Broken Hill Prospecting (ASX:BPL) has demonstrated that the Broken Hill region is highly prospective for pyritiferous cobalt deposits.
READ: Broken Hill Prospecting and Cobalt Blue form cobalt alliance with LG International, shares jump 30%
The Broken Hill region is also highly prospective for strata-bound cobalt deposits.
Two cobalt-nickel projects in Queensland
The Greenvale Cobalt-Nickel Project in Queensland is located 20-50 kilometres from Australian Mines’ (ASX:AUZ) Sconi Project, considered as one of the most advanced cobalt projects in Australia.
The company is also acquiring the Mount Tewoo Nickel-Cobalt-Manganese Project, 15 kilometres from Mt Cobalt in Queensland operated by Aus Tin Mining (ASX:ANW).
Ausmon has 30 days to carry out due diligence on the projects of New Base Metals prior to decision to execute an agreement for a definitive acquisition.