Perpetual Resources Ltd (ASX:PEC) has signed an option and acquisition agreement for acquiring Arrowsmith West, a tenement immediately south of Perpetual’s flagship Beharra High-Grade Silica Sand Project.
Arrowsmith West is prospective for high-grade silica sand and is highly strategic due to its proximity to Beharra.
The tenement contains prospective target areas within cleared farming land with minimal or no impact on existing native vegetation, and this boosts the potential for a rapid project development if exploration and other related studies indicate a viable project.
The total consideration for the acquisition including option payment is A$100,000, which will be paid in Perpetual shares.
“Beharra Project continues to go from strength to strength”
Perpetual managing director Robert Benussi said: “Arrowsmith West presents an exciting opportunity for Perpetual, being so close to our Beharra project and having such large portions of the tenement already cleared for farming purposes.
“It is our intention to rapidly assess this land package, to determine its geological and economic potential and how it could sequence with development of our regionally leading Beharra Project, which continues to go from strength to strength.”
Arrowsmith West
The Arrowsmith West tenement is around 270 kilometres north of Perth and is between the regional town of Dongara and Eneabba, in Western Australia.
Arrowsmith West is close to the existing infrastructures such as Brand Highway and the Geraldton-Eneabba Railway, having direct rail connectivity to Geraldton Port.
The tenement comprises a topographic high atop an aeolian sand dune system up to 15 meters thick from the western edge of the deposit with a gentle west and east sloping erosional surface.
Option and acquisition agreement
The transaction specifics of the option agreement includes:
- Initial option payment of $33,334, payable in Perpetual shares issued at 12.5 cents;
- Milestone payment of $33,333, payable in Perpetual shares, which will be paid on the grant of EL 70/5798;
- Second milestone payment of $33,333, also in Perpetual shares, paid on confirmation of a single test result showing the sand on E70/5798 can achieve greater than 99.5% silicon dioxide and less than 300 parts per million iron oxide; and
- The grant of a 1% gross revenue royalty concerning minerals extracted, produced and sold from the Arrowsmith West tenement.
The total consideration for the purchase of the tenement is A$100,000 assuming all milestones are achieved plus the 1% gross revenue royalty should the project advance to mining operations.
Future exploration activities
Perpetual is planning to secure access to the project and will undertake reconnaissance exploration activities in the coming months to assess the geological potential of the tenement.