Beadell Resources has entered into a binding arrangement to consolidate the Tucano land package.
Under the deal, Beadell will acquire the issued capital of Brazilian company Mineração Vale dos Reis Ltda (MVR) that holds 30% of the MVR joint venture (JV) surrounding Tucano gold project.
The remaining 70% stake of the joint venture lies with Beadell.
The consideration for acquisition of MVR is an initial payment of $300,000 upon closing and three additional payments of $500,000 over a 12-month period from the date of closing.
Total cash consideration is $1.8m and a further 0.75% Net Smelter Royalty (NSR) will have to be paid on any gold or other precious metals that are produced from the former JV ground.
Licences presently held completely by Beadell, including the Tucano mining lease, are not subject to this royalty.
Subject to customary due diligence and approval provisions, the MVR deal is expected to close on 30 June.
Beadell Resources MD and CEO Simon Jackson said: "The MVR transaction is a major step forward and consolidation of such a dominant land position in a very under-explored greenstone belt is very exciting.
“We will expand exploration activity onto the former JV ground with a view to not only adding near mine ounces but also to search for the next Tucano.
“Coupled with the ongoing exploration in the under-drilled Tucano mine corridor, we believe that the company has considerable scope to continue to add ounces.
“Generation of new gold targets and exploration will be ongoing on the Beadell land package for years to come.”
The JV tenements comprise 576km² of prospective ground surrounding the Tucano gold mine, including direct strike extensions of the Tucano mine corridor mineralisation at Urucum East where gold mineralisation has already been identified.
The JV tenements comprise several exceptional early stage gold targets within 20km of the Tucano plant, which are planned to be advanced to drilling in this year.
With completion of this MVR transaction, Beadell will own 100% of the complete 2,500km² tenement package surrounding Tucano gold mine.