Fe Limited (ASX:FEL) has entered a binding agreement to acquire a 60% interest in the exploration assets of Gecko Mining Company Pty Ltd (GMC) in the highly prospective Tennant Creek region of the Northern Territory.
The acquisition will be funded through the placement of 100,000,000 ordinary shares to sophisticated investors at $0.05 per share to raise $5 million.
Under the key terms of the acquisition, FEL will acquire a 60% interest in the tenement group for $5 million cash, 85 million FEL shares and 75 million FEL unlisted options exercisable at 10 cents expiring 3 years from the date of issue.
“We are very pleased with the support from existing and new shareholders for this capital raising, which was oversubscribed in a volatile market, FE executive chairman Tony Sage said.
“This funding puts us in a strong position to continue to progress our exciting suite of projects."
Early cashflow opportunity
FEL’s tenement package covers 240 square kilometres in the highly prospective Gecko – Goanna copper-gold corridor which has historically produced more than 5.5 million ounces of gold at 19.3 g/t and 488-kilo tonnes of copper at 2.9%.
Notably, the Tennant Creek Project has existing JORC 2004 resources.
FEL plans to focus initially on open-pit copper/gold early cash flow opportunity in the Orlando pit with significant exploration potential and follow up targets identified for early drilling.
“Diversify our commodity exposure”
“Mature copper/gold assets are hard to find in today’s market given the attractive thematic for those commodities, particularly for copper with its connection into the battery metals space,” Sage said.
“We are pleased to identify this opportunity to diversify our commodity exposure to supplement our high-grade iron ore at Wiluna and our other NT iron ore project Yarram, which is located just over 100km from Darwin port, which presents the opportunity for it to host a low-cost operation.
“The work that’s been done by since on the GMC ground since the project was acquired from Evolution Mining Ltd (ASX:EVN) in 2020 has identified some interesting opportunities for us to evaluate with the potential to fast-track production, so we look forward to our team taking these concepts forward in the fast and cost-efficient manner we have demonstrated at JWD.”
About Fe
Fe Limited (ASX:FEL) has now diversified our commodity exposure, with this purchase supplementing our high-grade iron ore at Wiluna and our other NT iron ore project Yarram, which is located just over 100km from Darwin port. Our strategy is focused on near-term, high-grade premium product projects and maintaining exposure to strategic metals.
It has a 51% interest in the near-production Wiluna West JWD iron ore deposit, which has a JORC 2004 estimate of 10.7 million tonnes at 63.7% iron and low impurities using a 55% iron cut-off, with 60% classified as a measured resource.