Platina Resources Ltd (ASX:PGM) (OTCMKTS:PTNUF) (FRA:P4R) has completed the acquisition of a 100% interest in the Xanadu Gold Project in Western Australia and allotted 12,735,849 ordinary fully paid shares as consideration.
The Xanadu Project is in the Ashburton Basin, 38 kilometres southeast of Paraburdoo and 95 kilometres south of Tom Price.
Expanding gold presence
In April this year, the company signed a conditional term sheet to acquire the project in a favourable regional scale structural setting in Ashburton province to expand its gold presence in Western Australia.
Xanadu is within proximity to the multi-million ounce Mt Olympus gold deposit of Kalamazoo Resources Ltd (ASX:KZR), which is just 7 kilometres to the east.
Platina’s new project comprises seven prospecting licences and five exploration licences covering 498 square kilometres.
Logistics and operations are expected to be low cost with access to the project from the regional mining centre of Paraburdoo, around 38 kilometres to the north.
New shares issued
The company has also issued 2 million shares for introduction and advisory services related to the acquisition of Xanadu.
Shares were issued under the company’s existing placement capacity under Listing Rule 7.1.
The company also confirms that following Listing Rule 3.10A, 7.78 million shares will be released from voluntary escrow on July 11, 2021.
Key terms of the agreement include:
- Payment of A$300,000 in cash and the issuance of A$675,000 Platina ordinary shares priced at 5.3 cents per share on signing the sale and purchase agreement. These shares will be escrowed for three months;
- At the 12-month anniversary of the agreement, Platina has an option to extend the agreement by issuing a further A$925,000 of Platina ordinary shares priced at A$0.053 per share to the vendors. If the option is not exercised the vendors can buy the tenements back for one dollar;
- A milestone payment of A$100,000 on reporting of a JORC (2012) mineral resource of 100,000 ounces of gold;
- A 1% gross gold royalty is payable on any gold produced from the prospecting licences and a further 1% new smelter royalty payable on all the tenements. Platina can buy back 50% of the net smelter royalty for A$1 million; and
- If tenements E 52/3763 and E 52/3764 are not formally granted, Platina can reduce the final share consideration by A$125,000 per tenement.