PERTH (miningweekly.com) – ASX-listed Classic Minerals has inked a non-binding memorandum of understanding (MoU) for the treatment of ore from its Forrestania gold project, in Western Australia.
The MoU, signed with Tianye SXO Gold Mining, allows for monthly parcels of between 20 000 t and 30 000 t for a 36-month period, with the assumption that the parties would agree to either a profit sharing or ore sales arrangement for gold-bearing ore produced from the Forrestania project.
Tianye is the owner of the Southern Cross operation, which includes the recently refurbished Marvel Loch processing plant.
Under the MoU, Classic will be responsible for drilling deposits to a Joint Ore Reserves Committee-compliant level, carrying out the initial metallurgical work, securing the necessary approvals and completing the economic analysis of the deposit of interest.
Once this work has been completed, the deposit will be submitted to Tianye SXO for review and the opportunity to carry out its own economic analysis, after which Tianye SXO will be entitled to make an offer to process the ore under either a profit share or ore purchase scenario.
“Although the company’s primary focus remains growing the resource and mining inventory via systematic exploration, this MoU is a much-welcomed development,” said Classic CEO Dean Goodwin.
“The close proximity of the Marvel Loch plant means that the deposits are no longer stranded assets, and we can start looking at near-term mining opportunities to bolster the cash flow of the company.”