Forrestania Resources has signed a binding ore purchase agreement with Karora, a fully owned subsidiary of Westgold Resources, to sell ore from its Gibraltar Gold Project, marking the company’s transition to gold production.
Under the terms of the agreement, Westgold will initially purchase approximately 150,000 dry tonnes of ore, with options to buy up to three additional parcels of 200,000 dry tonnes each, totalling up to 750,000 dry tonnes.
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A commencement payment of A$2m ($1.41m) will be made once certain conditions are met.
The ore will be sold at A$48 per dry tonne, generating an estimated A$7.2m in gross proceeds for the first parcel.
Forrestania will manage grade control drilling, mining operations and ore haulage to Westgold’s Higginsville Processing Hub.
The company anticipates delivery of the initial ore parcel by 31 March 2026.
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By GlobalDataThe agreement is contingent upon standard conditions precedent including grade control drilling results and metallurgical test work showing acceptable recovery rates.
Forrestania aims to establish operational systems and personnel capability required for future production activities through this transition.
The company will oversee mine scheduling, logistics for ore haulage and compliance management.
The experience gained will aid in the staged development of its Lake Johnston portfolio.
This agreement is set to enhance Forrestania’s funding position with near-term cash inflow from its fully owned asset.
Additionally, clearing stockpiles will improve operational space and enable further evaluation of potential pit expansions and mineralisation opportunities near previous underground workings.
Forrestania Resources chairman David Geraghty said: “During the second half of 2025 the company moved decisively to consolidate ground across the belt in proximity to existing processing infrastructure.
“That strategy has positioned us to execute this agreement and establish Forrestania as a new gold producer in Western Australia [WA]. This transaction allows us to monetise on previous transactions while building the operational capability required for Lake Johnston.”
Earlier this month, the company agreed to acquire the Aurumin Mt Palmer, Aurumin Johnson Range and Aurumin Mt Dimer subsidiaries from Newcam Minerals to take full ownership of the Mt Palmer gold project in WA.
