Red Metal Limited
OZ Minerals Alliance
GREENFIELDS DISCOVERY ALLIANCE WITH OZ MINERALS
In January 2019 Red Metal announced the execution of a significant, multi-project option and joint venture agreement with OZ Minerals Limited (OZ Minerals) aimed at fast-tracking the search for greenfield discoveries on Red Metal’s highly sought after Australian base metal exploration portfolio.
The agreement provided OZ Minerals with an option to fund a series of mutually agreed, proof-of-concept work programs on six of Red Metal’s exciting projects (Red Metal ASX announcement dated 30 January 2019).
The key benefits for Red Metal include:
- Sustained exploration funding with a minimum expenditure commitment totalling $8.05 million across six early stage projects;
- Flexible earn-in terms that give Red Metal the right of election to contribute at 49% or not contribute and be diluted to a 30% interest at completion of a positive decision to mine;
- Sufficient earn-in expenditure amounts to clearly outline any potential ore discoveries before Red Metal must elect whether or not to contribute;
- The opportunity to add new projects on broadly similar terms into the future; and
- Cash payments of $300,000 for each of the six nominated projects, totalling $1.8 million. Red Metal is also eligible to receive an additional payment of $500,000 for any successful project that OZ Minerals ultimately selects for joint venture earn-in.
Field activities are ongoing at the Yarrie, Gulf and Lawn Hill Projects (refer Projects Section). Following initial programs the Nullarbor, Three Ways and Mount Skipper projects were withdrawn from the Alliance. To June 2022 OZ Minerals has incurred in excess of $8 million exploring the Alliance projects.