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First Au (ASX:FAU) boosts its project portfolio, inks deal to acquire Mt Turner Project

Highlights

  • First Au Limited and Essex Minerals Inc inked a binding term sheet to acquire Queensland’s Mt Turner gold project.
  • The project would enhance the Company's existing copper prospects, including Mabel Creek, Victoria, and Dogwood.
  • FAU will also fund an Induced Polarisation survey at the project location during the option period.

First Au Limited (ASX:FAU, OTCQB: FRSAF) has entered into a binding term sheet with British Columbia-incorporated minerals explorer, Essex Minerals Inc, to acquire up to 100% stake in the Mt Turner gold project.

Bourses welcomed the signing of the term sheet agreement as shares of First Au surged 10% to AU$0.011 a share on 12 January 2022. The Mt Turner Project comprises two granted Exploration Permits stretching over 100 sq. kms in Queensland.

As per the agreement, FAU will have the option to earn 51% interest initially through farm-in and later enhance its interest to 100% in exploration permits 27170 and 27525.

FAU believes that the Mt Turner project would complement the Company's existing copper prospects, including Mabel Creek, Victoria and Dogwood. Copper is spearheading the race in helping the world to make a swift transition to green energy and in the electrification of the global economy.

Also Read: First AU (ASX:FAU) secures AU$1.84M funding to unlock true potential of Victorian and Mabel Creek Projects

The project targets a large copper-molybdenum porphyry system and epithermal gold-silver mineralisation with a strike length of 14km along the Drummer Fault System.

Location of Mt Turner Project, in Northern Queensland

Source: Company announcement (12 January 2022)

The project was first identified in 1975 through fieldwork by the Geological Survey of Queensland and the Bureau of Mineral Resources for polymetallic hydrothermal mineralisation and associated alteration footprint.

Although the project was first identified in 1975 through fieldwork by the Geological Survey of Queensland and the Bureau of Mineral Resources, the target area remains largely underexplored during historic exploration programs.

Related Article: First Au (ASX:FAU) has the first-mover edge at Victorian Goldfields

Agreement terms

Following the 60-day due diligence investigation, FAU has an option to earn 51% interest in the project, initially through a farm-in arrangement.

Due diligence

Source: © Pichetw | Megapixl.com

Upon the completion of due diligence, FAU will pay Essex Minerals an option fee of 5,000,000 ordinary FAU shares and 5,000,000 options. The options could be exercised to acquire one ordinary share of FAU at an exercise price of 3 cents and expire after 2 years of issuance.

  • The option will have a term of 220 days, and during the option term, FAU will also fund an Induced Polarisation survey and associated exploration program to identify drilling targets. The program is anticipated to cost AU$500,000 to FAU.
  • Conditional upon FAU’s exercising of the option, Essex will be entitled to 10 million shares and will then be required to spend AU$2 million within 2 years to earn a 51% interest in tenements.
  • As per the agreement, the Company will have the right, however, FAU will not be obliged to acquire outstanding 49% interest in the Mt Turner project.

Also Read: First Au Limited (ASX:FAU) secures $1.28 Mn funding, to raise another $2.45 Mn via options issue

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