Boab Metals has exercised its option to acquire 100% interest in the Sorby Hills project, gaining complete control of the silver-lead operation in Western Australia (WA).
The company currently owns a 75% ownership stake in the Sorby Hills project.
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Boab will acquire the remaining 25% interest from its joint venture (JV) partner, Henan Yuguang (Australia), for A$12.5m ($8.26m).
Following the acquisition, Boab will hold rights to sell over 100% of the planned 897 kilo tonnes (kt) of concentrate from Sorby Hills, which is expected to contain about 18.6 million ounces (moz) of silver and 575kt of lead.
The Sorby Hills site lies about 50 kilometres (km) northeast of Kununurra in the East Kimberley.
It is the largest undeveloped, near-surface lead-silver deposit in Australia, with mining leases granted, Environmental Protection Agency (EPA) approval secured, and located roughly 150km from the Port of Wyndham.
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By GlobalDataBoab has reached a final investment decision (FID) on the project and is aiming to commence initial production in the second half (H2) of 2027.
Boab managing director and CEO Simon Noon said: “Yuguang has been a committed partner over the past seven years of Boab’s involvement in the Sorby Hills joint venture. Their support during this period has been invaluable to progressing the Project to the point where we have been able to make a Final Investment Decision.
“We thank them for this support. With 100% ownership comes the right to deal with 100% of the concentrate produced at Sorby Hills and greater exposure for our shareholders to the increasing operating margins being driven by a silver price that is more than 100% above what we assumed in our FEED Study. Importantly, the funds raised during the quarter have accounted for the completion payment and 100% of the Project Capex. Therefore, the Project remains fully funded.”
In addition to the A$12.5m completion payment, Boab will make deferred payments to Yuguang of A$5.5m at 12 months and A$5m at 18 months after the start of concentrate production.
The transaction is anticipated to close in January 2026.
All funds secured by the company during the quarter were raised on a fully owned basis. As a result, exercising the option will not require any additional funding.
Earlier in September, Boab and Yuguang had mutually agreed to extend the option period for acquiring full ownership of the Sorby Hills project.
