Galena Mining Ltd (ASX:G1A) has shared a plan to divest its non-core assets into a new company Metal Range Limited planning to list on the ASX.
The company said today Metal Range would house Galena’s early-stage polymetallic base metals exploration prospects, Woodlands, Manganese Range and Quartzite Well.
The divestment allows Galena to firmly focus on its flagship Abra Base Metals Project in Western Australia.
READ: Galena Mining strengthens board with operational experience as Abra moves to development
Galena released a pre-feasibility study for the Abra project last month and moved onto a definitive feasibility study earlier this month.
Leading Australian engineering consulting and contracting company GR Engineering Services Ltd (ASX:GNG) will undertake key portions of the DFS.
Galena is aiming to produce first lead-silver concentrate from Abra in 2021.
The company said today Galena retains the exploration licence for the area “immediately surrounding Abra”, including Hyperion prospect, and the resource development potential of Abra’s granted mining licence.
READ: Galena Mining launches into Abra Base Metals Project DFS to follow-up “excellent” PFS
Galena managing director Alex Molyneux told the market: “Galena is laser-focused on getting Abra into construction in 2019 and the separation of Metal Range helps with that, whilst it may also create additional optionality for our shareholders to participate in a separate ASX listing and priority offer.”
The company said it intended to make a priority offering to Galena shareholders for fundraising linked to the planned Metal Range initial public offering.
Molyneux shared on behalf of the company: “Galena will be able to focus all of its resources including its management time and funds to accelerate the development of Abra with a view to moving into construction in 2019.”
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Galena had agreed to “vend-in” to four exploration licences about 20 kilometres west of Abra – the E52/1413, E52/3575, E52/3630 and E52/3581 exploration licences – and these rights and ownerships will move into Metal Range.
The company shared a map showing the proposed separation of Galena and Metal Range tenements and highlighted drilling achievements at Metal Range prospects.
Highlights from drilling featured 10.5 metres grading 0.42% copper from 332 metres in GWD001, including 0.5 metres at 1.63% copper and 0.25 g/t gold.
Galena’s Manganese Range prospects will go into the newco, where limited shallow historical reconnaissance drilling returned 28 metres grading 2.3% lead, 32 g/t silver and 1.2% zinc, and 12 metres at 18.8% manganese.
Quartzite Well had 34 metres at 2% lead, 1.1% zinc and six metres at 5.9% lead.
Both prospects are key to future exploration efforts for newco Metal Range.
Molyneux shared on behalf of the company: “Exploration activity on the Metal Range Prospects will be able to be accelerated as a priority in a new stand-alone entity.”
Galena plans to remain a shareholder of Metal Range after additional investors join its registry, ensuring its current investors continue to benefit from the asset holdings.