Riversgold ASX:RGL has secured a key permitting milestone with the granting of mining lease M25/389 over the Northern Zone, part of its Kalgoorlie gold project in Western Australia.
Located approximately 25 kilometres east of Kalgoorlie, the project forms part of Riversgold’s broader gold portfolio in the region.
The grant, which has been granted for a renewable term of 21 years through to 1 July 2047, satisfies a major condition attached to the company’s funding and development partnership with WA Goldfields mining contractor Mega Resources.
Drilling at the Northern Zone project area has already identified a gold-mineralised porphyry around 600m wide and approximately 500m deep, and Riversgold is now preparing site clearance permit and national vegetation clearing permit (NVCP) applications for submission this month.
The company is also completing inputs for its Mine Development and Closure Proposal (MDCP), which would provide the operating approval needed to start mining activities.
Development Partnership Advances
Riversgold signed a Mining and Co-Operation agreement with Mega Resources in September for full project funding, mining, and haulage services at Northern Zone.
Mega is expected to provide all geological and engineering services, operational funding, and project approvals management under the proposed arrangement.
The Northern Zone project is owned 80% by Riversgold and 20% by Oracle Power Plc, with the project owners not required to provide upfront funding under the Mega structure.
Mega and the project owners would share operating profits equally, while 10% of monthly project profits would be reinvested into expansion grade control and step-out drilling on a 50:50-funded basis.
‘A Tremendous Result’
Executive chair David Lenigas said the lease grant represented a “great milestone for this very exciting gold project so close to Kalgoorlie.”
“To have this mining lease granted after an 18-month process is a tremendous result for the Company, our JV partners, Oracle Power in the UK, and our funding and production partner Mega Resources,” he said.
"A significant number of the inputs have already been completed, […] with the last of the inputs currently being finalised.”
“As of today, we are now much closer to turning dirt at Northern Zone and I look forward to updating shareholders on progress with the MDCP very soon.”
Incentive Milestones Set
Riversgold has also outlined performance right milestones designed to align executive management and key personnel with project development and shareholder value outcomes.
The performance rights will directly link performance outcomes to resource growth milestones, […] and will be issued under the company’s Equity Securities Incentive Plan.
Subject to shareholder approval, the proposed tranches will include vesting milestones linked to a 20-day volume-weighted average price of at least $0.03 and $0.05, breaking ground at Northern Zone, and achieving first gold from any company project.
Further milestones would include cumulative production of 50,000 ounces of gold from one or multiple projects, with full details to be finalised.