Exploration Program
An exploration program by Rox, budgeted at $500,000, commenced in May 2008 comprising drilling, soil and rock chip sampling and geophysics. The drilling is targeting a body of zinc-lead sulphide mineralisation over an area of at least 1,000 x 1,500 metres with a nominal hole spacing of approximately 400 x 400 metres.
Figure 1: Myrtle Prospect Drill Plan showing the location of existing holes (red dots) and planned holes (yellow dots). Also shown is a geological plan, with the prospective host unit for stratiform zinc-lead mineralisation (Barney Creek Formation) in red, with younger rocks shown as light blue and older rocks shown as dark blue. Part of an IP anomaly delineated in 1966 is shown. The remainder of the IP anomaly is located to the east beyond the drilled area, and presents a target for future drilling.
Tenement and Legal Information
The Reward EL 10316 was granted to North Mining Limited on 22 July 2002 and is current to 21 July 2008. It may then be renewed for two further periods of two years, if expenditure requirements are met. Currently, total expenditure amounts to $1,086,677 against a commitment of $230,000 over the life of the tenement.
A Native Title Agreement, dated 29 October 2002, has been entered into between North, Local Aboriginal Groups, and the Northern Land Council. It provides a process for work program approvals.
The Agreement between Rox and North entails:
- An option fee of A$50,000 for two years,
- A commitment for Rox to complete 1,200 metres of drilling within the first 12 months,
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Exercise of the option by entering into a Sale and Purchase Agreement, terms of which include:
- An acquisition payment of A$1/tonne (indexed for CPI) of the Mineral Resource defined in a BFS, payable upon decision to mine.
- A 2% Net Smelter Royalty to North.
- A clawback entitlement to North to acquire a 60% interest in the tenement by repayment to Rox of four (4) times Rox’s expenditure (with a minimum repayment of A$25 million), triggered by either, the definition of a Mineral Resource worth more than A$5 billion, or completion of an Order of Magnitude Study, or the commencement of a Pre-feasibility or a Feasibility Study.
- North also has an option to increase its interest to 80% in the tenement by free carry of Rox to completion of a Bankable Feasibility Study.