Forrestania Resources (ASX:FRS) has entered into a binding agreement with Askari Metals (ASX:AS2) to acquire Askari’s 100%-owned subsidiary, First Western Gold Pty Ltd for $700,000. First Western Gold holds seven exploration licenses and one exploration license applications in the Burracoppin Gold Project.
Burracoppin has a JORC 2012 MRE of 2.14Mt @1.2g/t Au for 82,7000 ounces of gold at a cutoff grade of 0.55g/t Au.
Under the terms of the agreement, Forrestania will pay $250,000 cash to Askari as well as issue to Askari a number of fully paid ordinary shares equal to $450,000 divided by the 5-day volume weighted average price of the Forrestania shares trading on the ASX over the 5-days prior to the date of execution of the agreement. The VWAP has been calculated at $0.2024. Forrestania will issue 2,223,321 shares at completion of the deal.
Subject to Askari Metals shareholder approval, Forrestania will receive 15M listed option exercisable at 2.2 cents, expiring 31 December 2028 as well as an additional 30M unlisted options exercisable at 6 cents, expiring three years from the date of issue.
Forrestania Resources’ Chairman David Geraghty commented: “This acquisition continues our strategy of consolidating high-quality gold assets in the Southern Cross region. With further exploration success, the project has the potential to both expand its resources base and advance through the approvals process toward a future mining lease.”
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