Cobra Resources PLC and Barton Gold have entered into an agreement for the sale and purchase of Cobra’s Wudinna Gold Project, which hosts a JORC (2012) Mineral Resource of 279,000oz Au on South Australia’s Eyre Peninsula. The agreement was made by possible by new South Australian regulations allowing for the sub-division of mining tenements.
Each of AMEC (Association of Mining and Exploration Companies), Cobra and Barton have noted the South Australian Department for Energy and Mining’s leadership role in crafting the new regulations, which enable an otherwise unlikely transaction by assuring the security of tenure essential to investment in early-stage mineral development.
Security of tenure is integral to promoting resource M&A and it’s good to see the Government’s active participation to enable the State’s exploration sector. In particular, the Cobra and Barton transaction will allow Cobra to focus on rare earths development at its Boland Rare Earths Project, while Barton takes the Wudinna Gold Project into active management under its regional gold development portfolio.
This specialisation of focus, and focus of capital investment, increases the chances of success for each project, and therefore the chances of benefits to South Australia.
Cobra Managing Director Rupert Verco said of the transaction:
“This Transaction will take Barton Gold’s resource to over two million ounces, with existing infrastructure. It provides Cobra the opportunity to become a significant shareholder in a province scale gold strategy, while enabling us to direct capital and attention to unlocking the value in Boland, which has the potential to become a significant low-cost source of critical terbium and dysprosium for the Western world.”
Barton Managing Director Alexander Scanlon said of the transaction:
“The assets offer significant low-cost optionality to Barton’s long-term regional development objectives, and we will be pleased to welcome Cobra and its shareholders to Barton’s register as we steadily unlock value across our entire platform.
“We applaud South Australia for a new regulatory framework permitting the sub-division of mineral tenements. This deal is a ‘first of its kind’ for minerals transactions based upon the revised legislation for tenement subdivisions in South Australia. We hope that it will serve as a quality model for unlocking and advance mineral value in the State.
“Additionally, it is very much a ‘win-win-win’ deal – for Barton Gold, for Cobra Resources, and for the State – where Barton and Cobra will now provide full backing to two different projects, and the State will therefore benefit from both.”
It’s a strategic win for mining in South Australia.
