Black Dragon Gold has agreed to purchase private company Marlee Gold to expand its business in Western Australia.
Marlee Gold owns a 100% stake in Padbury Gold Project and Ivan Well Project in the highly prospective Yilgarn Craton area in Western Australia.
The two projects comprise 481km² of mineral exploration licences.
Black Dragon will provide a A$10,000 fee for exclusive due diligence to acquire Marlee Gold.
The deal consideration includes $70,000 cash; 1,428,571 Black Dragon shares; and one million unlisted options upon completion of the transaction.
The transaction also includes 1.5% net smelter royalty, as well as deferred consideration of $1m in cash or shares upon Black Dragon announcing at least 500,000oz of the mineral resource estimate.
Black Dragon will issue a further $1m in cash or shares upon an additional 500,000oz mineral resource for the projects.
The purchase is part of Black Dragon’s efforts to expand and diversify its precious metal exploration portfolio while advancing the high-grade Salave gold project in northern Spain.
Black Dragon managing director Gabriel Chiappini said: “We have completed a thorough review and due diligence process of several precious metal new venture opportunities in Australia. The standout performer from this process was Marlee Gold, offering a low-cost, high-reward entry into the Western Australian gold exploration sector.
“The projects compiled by Marlee Gold show extensive, yet untested gold anomalism and present a significant opportunity for a new discovery.
“The addition of Marlee Gold complements the ongoing development work we’re undertaking at our 1.5Moz+ Salave Gold Project in Spain. Our main focus for value-accretive returns for our shareholders is to progress and develop the Salave Gold Project in Spain.”
Located 90km NNW of the gold mining centre of Meekatharra, the Padbury Gold Project comprises granitoid-hosted gold targets with extensive gold occurrences.
The Ivan Well Project, which is located 160km NNE of Wiluna in the northern Goldfields region, includes a largely underexplored portion of the Earaheedy Basin.
Black Dragon plans to undertake an exploration programme for Padbury and Ivan Well.
This will include integration and interpretation of remote sensing and geophysical data; soil geochemistry; and regional reconnaissance and mapping.