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(Sharecast News) - Oracle Power announced the acquisition of two "highly prospective" gold projects in Western Australia on Monday.
The AIM-traded firm said the acquisition of the assets, which were both located in "world-class" gold mining districts, advanced its strategy to become an international developer of high quality natural resources and power projects.
It said the Northern Zone project is located 25 kilometres east of the major gold mining centre of Kalgoorlie, the home of the 'Super Pit' mine, which is the second largest gold mine in Australia.
Oracle said multiple significant drill intercepts had been recorded from historical drill programmes conducted by Northern Mining.
The Jundee East project, meanwhile, is located around nine kilometres east of Northern Star's Jundee Gold Mine, also one of Australia's largest gold mines.
It said a potential new buried greenstone belt had been identified from gravity modelling, highlighting prospective new target areas for gold exploration at Jundee East "very close" to one of Australia's tier-1 gold mines.
Acquisition of the Northern Zone and Jundee East projects were being satisfied by a payment of £90,000 cash, and the issue of 42,857,143 new shares.
Warrants to subscribe for 42,857,143 shares exercisable at a price of 1.1p for 24 months from issue would also be issued to the vendor.
The board said the acquisition of the gold interests complemented its flagship Thar Block VI project in Pakistan, and its evaluation of opportunities in Africa.
"To secure a deal on these assets in Western Australia is a very significant and exciting new development for Oracle," said chief executive officer Naheed Memon.
"The Northern Zone project is essentially drill-ready, and the Jundee East project has the potential to discover gold mineralisation in a newly identified greenstone belt that has very similar geophysical signatures to the nearby Jundee Gold Mine.
"Gold is a commodity which we believe has the potential to generate significant returns for the company and our shareholders, and Western Australia is, from both a geological and political standpoint, perhaps the optimal region globally to develop a new gold mine."
Memon said securing the assets for a "modest" cash and equity consideration was an "exceptional find" for Oracle investors, adding that he was "excited" of report updates in the future as the firm looked to prove up the projects and demonstrate their potential to become standalone gold mines.
"Furthermore, the acquisition of these projects significantly strengthens our investment proposition and appeal to new investors. Combining gold exploration with our flagship Thar Block VI Project in Pakistan, which is intended to include a coal mine, mine mouth power plant, coal gasification plant and coal-to-liquid processing for liquid fuel, in addition to the evaluation work we are undertaking with the private office of His Highness Sheikh Ahmed Bin Dalmook Al Maktoum in Africa, has the potential to establish Oracle as a multi-commodity, multiple revenue stream business in the future."
At 1400 GMT, shares in Oracle Power were up 15.67% at 0.69p.
6 Feb 2024 16:19
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