Alto Metals Ltd (ASX:AME) has entered a binding agreement with Gateway Mining Ltd (ASX:GML) to acquire a granted exploration tenement contiguous with the company’s 331,000-ounce Sandstone Gold Project tenements in Western Australia’s East Murchison Gold Field.
The additional tenement E57/1108 covers more than 15 kilometres of strike of the regionally important Edale Shear.
It consolidates Alto’s landholding to in excess of 900 square kilometres, comprising the majority of the highly prospective and under-explored Sandstone Greenstone Belt.
The acquisition complements Alto’s immediate exploration focus on the ‘Alpha’ domain region of the Sandstone project around the Lords Corridor and secures south-eastern extensions to the Edale Shear.
“Increasing overall footprint”
Alto’s managing director Matthew Bowles said: This acquisition further consolidates our considerable ground position, increasing our overall footprint to more than 900 square kilometres which cover the highly prospective and underexplored Sandstone Greenstone Belt.
“We currently have an aggressive RC drilling program underway along the Lords Corridor, with a second rig arriving mid-February to accelerate drilling at Lord Henry, Lord Nelson and a number of other targets.
“With recent results from a major step-out hole highlighting another new mineralised zone along the Lords Corridor, we are excited about the potential that is starting to emerge at our Sandstone Gold Project.”
The tenement
Tenement E57/1108 is in the east of Alto’s 100%-owned Sandstone project and hosts more than 15 kilometres of the regionally significant Edale Shear.
Exploration to date has been relatively limited and the entire tenement is covered by recent alluvial/sheet wash sediments, masking mineralisation to historic prospecting activities and much surface geochemical sampling.
However, the tenement is considered prospective to host moderate to large scale gold mineralisation, particularly associated with the Edale Shear, which is a type of structure interpreted to be the deep feeder channels for orogenic gold deposits globally.
Key terms
Alto has signed a binding agreement with Gateway to acquire the 100% interest and the key terms are:
- Alto shall issue Gateway the equivalent of $50,000 in Alto shares upon transfer of the tenement;
- Gateway shall retain a 1% net smelter return (NSR) royalty over the tenement;
- Alto has the right to extinguish the NSR by paying Gateway $2.5 million at a decision to mine; and
- Alto retains pre-emptive rights concerning the NSR.
The agreement is subject to a certain number of suspensive conditions required to be satisfied by the parties, including the transfer of the tenement.