Perth-based minerals explorer Northern Star Resources Ltd will pay $100,000 and issue shares and options to Fraka Investments Pty Ltd, resolving the company's competing claim for mineral rights over the Wilson River Project in the East Kimberley.
Perth-based minerals explorer Northern Star Resources Ltd will pay $100,000 and issue shares and options to Fraka Investments Pty Ltd, resolving the company's competing claim for mineral rights over the Wilson River Project in the East Kimberley.
Aside from the cash issue, Northern Star will issue 1.5 million fully-paid shares and 1.5 million options worth 20 cents each to Fraka.
In return, Fraka will withdraw its application over one tenement, and its objection to another Northern Star application.
The full text of a Northern Star announcement is pasted below
- Agreement reached with Fraka Investments Pty Ltd to resolve competing claim for mineral rights over the Range Prospect (Wilson River Project - East Kimberley).
- Northern Star to proceed with aggressive exploration including a 2,000m drill program at the Range Prospect (best intercepts to date of 5m @ 15.08g/t Au and 4m @ 15.1g/t).
Northern Star Resources Ltd (ASX: NST) advises that it has resolved with Fraka Investments Pty Ltd ("Fraka") a commercial settlement of Fraka's competing claim for the mineral rights over part of its Wilson River Project in the East Kimberley region of Western Australia, including the high-grade gold discovery at the Range Prospect.
Under the agreement between the parties, Fraka will:
- withdraw its application over the tenement E80/3933; and
- withdraw its objection to Northern Star's application over E80/4001, which covers the same ground as E80/2426 and E80/2427.
In consideration, Northern Star will make a cash payment of $100,000 to Fraka and issue 1.5 million fully-paid shares and 1.5 million 20 cent options expiring three years from the date of issue. Both the shares and options will be subject to a 12-month voluntary escrow period which can be waived at any time at Northern Star's discretion.
The settlement clears the way as soon as E80/4001 is granted for Northern Star to resume exploration at the Range Prospect, which is regarded as a significant greenfields gold discovery in a region with no previously recorded gold mineralisation.
Commenting on the agreement, Northern Star's Managing Director, Mr Bill Beament, said: "We are very pleased to have reached a commercial settlement with Fraka. It gives Northern Star certainly over one of its prized assets and kills the need for costly litigation. This will enable us to get on with our core business of exploring and advancing the exciting gold discovery at the Range Prospect."
"We view this as a sensible and pragmatic outcome," he added. "We intend to resume exploration at the Range Prospect as rapidly as possible without any further delays arising from ongoing legal proceedings."
Northern Star first announced the Range discovery in 2005, with initial drilling returning spectacular grades of 5m @ 15.1g/t Au (34.9g/t Ag), 4m @ 15.1g/t Au (7.3g/t Ag) and 6.2m @ 10.5g/t Au (45g/t Ag). Subsequent drilling carried out last year tested the margins of the known mineralised system, highlighting the potential of a major complex.
Mr Beament said the Company's strategy moving forward would be to focus around the zone of known high-grade mineralisation to test for extensions of the high-grade shoots within the quartz veins.
The Company is planning to commence a program of 2,000 metres of RC drilling to further evaluate the gold and silver mineralisation in the 2008 field season.
"This program will focus on testing the mineralisation already intersected to determine the potential shoot geometry and provide us with a more detailed understanding of the mineralisation in the region as well as to test the continuity of the mineralisation around the immediate area of the high-grade intercepts," Mr Beament said.
The mineralised veins have been defined within an extensive north-northeast trending corridor which is over 2km long and 1km wide. The silicified quartz veins at the Range and nearby Hunter prospects are similar to those from epithermal quartz vein systems in Queensland's Drummond Basin which host the multi-million ounce Pajingo-Vera-Nancy and Cracow deposits, although these are of a younger age.
The Range drilling program will proceed in parallel with the Company's recently commenced fast-track exploration program at the promising Emull Zinc Project, where it is testing for extensions of a zone of near-surface high-grade zinc mineralisation.
