ASX-listed Terramin Australia has signed an agreement with Kitticooler to acquire 100% of Private Mine No 53 (PM 53), near Palmer, South Australia.
Private Mine No 53 consists of the historic Kitticoola copper-gold mine that was operated intermittently between 1846 and 1971.
Between 1846 and 1869, it operated as a copper mine, producing 7,000t of ore at an estimated average grade of 2.25% copper.
Gold potential at the mine was identified in 1890. The mine intermittently produced 30,000t of ore at an average recovered grade of 5.4 g/t gold.
Kitticoola is situated 2.5km south of Palmer and around 62km from Terramin’s Angas Processing Facility (APF) at Strathalbyn.
Terramin Australia CEO Richard Taylor said: “Terramin is excited about the opportunity of adding potential production from Kitticoola to its Bird-in-Hand Project in the Adelaide Hills. PM53 is fairly unique in that it remains an approved mine (subject to the grant of updated environment approvals) that has not operated since 1971.”
Kitticoola, which has had ‘only limited modern exploration’ exposure, is expected to present significant synergies with Terramin’s other assets.
Taylor further added: “If successful, exploration would provide additional feed to processing planned for the Angas facility at Strathalbyn. Operating the two projects would potentially increase local employment from the forecast 140 roles already earmarked for Woodside and Strathalbyn.”
The deal with KHP on PM 53 offers Terramin to gain exploration rights and potential future mining rights over Kitticoola, provided it pays land access fees and a sliding scale royalty.
As per the agreement, Terramin will have to pay 2% royalty for all gold produced from the Kitticoola tenement; 2.5% NSR royalty if certain government fiscal concessions are available to PM53; 3% NSR, applicable in either cases, if the London Metal Exchange (LME) gold price is greater than A$1800 per ounce or a larger than expected resource is defined.