First Au (ASX:FAU) shares gain over 11% today. Here's why!

January 30, 2023 04:35 PM AEDT | By Manisha
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  • First Au (ASX:FAU) shares gained 11.11% to trade at AU$0.005 on 30 January 2023.
  • Today, the company revealed that it has signed a binding tenement sale agreement to sell tenements forming the Mabel Creek Project to Talisman Mining.
  • FAU has agreed to sell the project for aggregate consideration of AU$200,000 in cash and AU$100,000 of TLM fully paid ordinary shares.
  • The company decided to divest the project to have an increased focus of its resources on other assets.

Gold and base metals exploration player First Au Limited (ASX:FAU) saw a spike in its share price in the early hours of the trading session today. FAU shares were spotted at AU$0.005 apiece at 11:34 AM on 30 January 2023, marking an 11.11% gain from the previous day.

Possibly, the jump in the stock price was backed by the release of a market update, highlighting the sale of a non-priority project.

Under a binding tenement sale agreement, the company is divesting tenements forming the Mabel Creek Project to Talisman Mining Limited (ASX:TLM). The cash-and-share deal entails a consideration of AU$200,000 in cash and AU$100,000 of TLM fully paid ordinary shares.

The ASX-listed company has divested the project as part of its strategy to direct its resources towards exploration programs at the Victorian Goldfields Project and the Gimlet Gold Project.  

More details about the strategic move

Recently, First Au conducted an in-depth review of its assets, following which the company concluded that Mabel Creek is not a priority project and therefore, it can be divested so as to channelise the entire focus on other assets.

However, First Au would retain exposure to any potential upside in Mabel Creek via a shareholding in Talisman Mining.

An insight into FAU’s projects

First AU has ground holding in significant mineral fields across the country. This includes the Victorian Goldfields Project in East Gippsland and the Gimlet Gold in the Kalgoorlie area of Western Australia.

FAU continues to make progress at its Victoria Gold & Base Metals Projects. The Company announced assay results from the Dogwood Project in December 2022 highlighting the potential of the project, with the deepest hole of the program producing multiple mineralised intersections. Also, rock chip sample results from Haunted Stream and Snowstorm have been announced.

First Au has been advancing its underground rehabilitation program at Haunted Stream. The company aims to conduct future drilling. At the Snowstorm Project, FAU is stepping ahead with the process of seeking approvals for the proposed bulk sampling at the site.

Gimlet Gold Project

FAU’s Gimlet Gold Project has a Mineral Resource Estimate (MRE) of an Inferred Resource of 1,166,000 tonnes at 3.2g/t Au for 120,000 ounces at a 1 g/t cut-off.

Recently, FAU received encouraging results from the metallurgical test work conducted on the project. As per the results, high recovery rates have been observed from the treatment and processing of gold bearing materials from Gimlet. So far, gold recovery rates of 87.99% have been demonstrated from the testing done.



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