Auzex Resources acquires additional land position near 2.6 million gold ounce Bullabulling

Auzex Resources (ASX: AZX) and joint venture partner GGG Resources (ASX: GGB, LON: GGG) have made a strategic acquisition of the Geko Gold Project, after executing an option to acquire 100%, costing around $3 million.

The significance of Geko is the strategic location, just 17 kilometres from Auzex and GGG Resources 2.6 million gold ounce Bullabulling project, which in turn is 70 kilometres southwest of Kalgoorlie in Western Australia.

Geko has historically had some exploration undertaken in the 1990’s by Newcrest and others, where importantly gold mineralisation was intersected that can be correlated with the same sequence of lithologies which host the Bullabulling gold deposit.

Highlighting the potential of the new land holding, the joint venture said that it considers the transaction to offer significant exploration potential for gold that may be complimentary to a future mining operation currently under Pre-Feasibility at Bullabulling.

Adding some spice to Geko is the possibility of any future gold ore that is mined, could easily be transported to Bullabulling for processing - providing the joint venture with economies of scale in the area.


Terms of the $3.0 million option acquisition
- $0.5 million cash payable by BBG if the merger of AZX and GGG has been completed or in equal proportions by GGG and AZX if the merger has not been completed; and

- If the merger has been completed, the newly formed merged entity, Bullabulling Gold may, at its election – pay the seller the remaining $2.5 million in cash or BBG scrip based on a 5 day VWAP immediately prior to the purchase; or

-  If the merger has not been completed, each of AZX and GGG must, at its election either; $1.25 million in cash to the seller; or issue shares to the seller to the value of $1.25 million based on a 5 day VWAP immediately prior to the purchase; and

- Production royalty of $10 per ounce for all gold sold from the tenement if the option is exercised.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/24512/auzex-resources-acquires-additional-land-position-near-26-million-gold-ounce-bullabulling-24512.html