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Kalamazoo Resources acquires project from Northern Star that 'no longer fits'

Kitco News

Kalamazoo Resources said Tuesday that it acquired the 217 square kilometer Ashburton Gold Project, located on the southern edge of the Pilbara Craton, Western Australia, from Northern Star Resources.

Northern Star has its hands full. Last year it acquired Kalgoorlie Consolidated Gold Mines for about $1.6 billion in total in separate transactions from Newmont and Barrick.

The Ashburton Gold Project has produced 350,000 ounces of gold and currently contains a mineral resource estimate of 20.8 million tonnes at 2.5g/t Au for 1.65 million ounces.

Terms of the deal are $5.0M on mining of the first 250,000 tonnes of ore and a 2% net smelter royalty on the first 250,000oz of gold produced, with a 0.75% NSR on any subsequent gold produced from the tenements.

Northern Star executive chairman Bill Beament said the deal grants his company exposure to any upside from development.

“The Ashburton project no longer fits in Northern Star’s portfolio but still has strong potential on both the exploration and production fronts. The royalty structure also enables Northern Star to retain an exposure to the project.”

Kalamzoo said exploration will commence immediately.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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