Australian miner Kalamazoo Resources has agreed to acquire the Mt Piper gold project in central Victoria, Australia, from Coda Minerals.

Kalamazoo will pay A$300,000 ($2,05,533) in cash and issue 1.52 million fully paid Kalamazoo ordinary shares upon completion of the deal.

Furthermore, Coda Minerals will also receive a 1% net smelter royalty (NSR), which would be paid on any minerals extracted from the project tenements.

Coda conceded after a review of the Mt Piper mine project that despite its prospectivity, moving forward with exploration in the Victorian goldfields does not comply with its strategy.

Upon completion of the deal, Coda intends to focus on developing its 100% owned Elizabeth Creek Copper Project in South Australia.

Coda Minerals CEO Chris Stevens said: “The transaction places Mt Piper with an experienced Victorian Goldfields operator, which Coda believes is better placed to maximise the future value potential of this under-explored asset. Coda is fully focused on progressing its flagship Elizabeth Creek and Cameron River copper projects.

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“The deal is structured in way that crystallises some upfront cash value while allowing Coda shareholders to retain exposure to future upside in the Victorian Goldfields via a shareholding in Kalamazoo.”

Kalamazoo Resources plans to undertake an initial ‘low impact’ exploration campaign at the 1,609km² Mt Piper gold project following a community engagement process.

The company complies with its strategy to purchase and develop major resource projects, with considerable exploration and development potential, in mineral provinces Victoria and the Pilbara.

Kalamazoo Resources chairman and CEO Luke Reinehr said: “Our continued consolidation of highly prospective exploration ground in the Central Victorian Goldfields is enhanced by the ongoing success at the high-grade Fosterville and Costerfield gold mines.

“These projects contain high-grade gold antimony mineralisation near the main fault margin separating the Bendigo and Melbourne Zones and are reported to be the No. 1 and No. 7 highest milled grade gold mines worldwide in 2021, respectively.”

The Mt Piper Gold Project is strategically located adjacent to Agnico Eagle Mine’s large exploration land tenure and 30km from Fosterville gold mine in Central Victoria.

It is prospective for epizonal, high-grade gold and antimony deposits. Its tenements are considered under-explored and not subjected to modern exploration techniques.

The deal is subject to ministerial consent and other limited conditions.