Brightstar sharpens focus by slicing up to 80% of non-core Goongarrie gold project for Cazaly

Brightstar Resources to focus on its development and mining operations after farming out Goongarrie project to Cazaly Resources.

Brightstar is slicing off up to 80% in the Goongarrie project to Cazaly in return for up to $3m in exploration expenditure. Pic: Getty Images

• Brightstar Resources is farming out its Goongarrie project to Cazaly Resources

• Cazaly can earn up to 80% by sole-funding up to $3m in exploration expenditure

• Deal allows BTR to focus on its development and mining operations

Special Report: Brightstar Resources has granted Cazaly Resources the option to earn to earn up to 80% in the non-core Goongarrie project in WA’s Goldfields region in return for $3m in exploration expenditure.

Under the binding term sheet, Cazaly Resources (ASX:CAZ) can earn the interest in the project, which is 30km south of Menzies, in three phases once it moves to exercise its option following a 90-day due diligence period.

For Brightstar Resources (ASX:BTR), the earn-in will allow it to focus on definitive feasibility study workstreams for its Menzies and Laverton projects, current mining operations at the Second Fortune underground mine, and start-up works at the Fish underground project.

It will also focus on improving and growing existing resources at projects with granted mining leases and near-term commercialisation pathways, such as the Sandstone, Menzies and its broader Laverton project areas.

“With our focus on development and mining operations across the broader Eastern Goldfields and Murchison regions, we are delighted to have attracted a quality partner in Cazaly to explore the Lake Goongarrie area in greater detail, while retaining exposure and upside to exploration success with the joint venture,” managing director Alex Rovira said.

“Our focus in the general Menzies area is on the Lady Shenton system, where we are defining a large open pit mining complex as part of our DFS, whilst we continue to explore and assess other deposits such as Yunndaga and the Link Zone for future mining opportunities to increase our operational footprint in the Menzies area.”

The Goongarrie project. Pic: Brightstar Resources

Cazaly earn-in

Cazaly has 90-days to exercise the option, after which it will commit to spend $1m over an initial 12 month to earn 25%.

It can then spend a further $1m over a further 18 months to earn another 26% and yet another $1m over 18 months to reach the 80% stake.

Once Cazaly earns the initial stake, the two companies will form a joint venture to explore and potentially develop the project, which is assessed via the sealed Goldfields highway.

This article was developed in collaboration with Brightstar Resources, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

Originally published as Brightstar sharpens focus by slicing up to 80% of non-core Goongarrie gold project for Cazaly