Tombola Secures Regional Position
Brisbane, July 13, 2022 AEST (ABN Newswire) - Tombola Gold Ltd (
ASX:TBA) is pleased to announce that it has secured a significant and strategic regional footprint around the Company's existing Mt Freda project via the formalisation of the acquisition agreements for the Lorena Gold Project and, additionally, the execution of a binding Term Sheet with True North Copper Pty Ltd pursuant to which the Company will gain an interest in a further five (5) project sites around Cloncurry, including mining leases. These acquisitions will allow the Company to fast track its gold production capabilities, as well as adding to its resource base and production horizon.
HIGHLIGHTS
Lorena Gold Project
- Formal Acquisition agreements have been signed for 100% of Lorena Mine and Processing Facility ("Lorena"), with enhanced terms.
- The Lorena assets include fully permitted mining and exploration leases, the existing open cut gold and copper mine, a 250,000-300,000 Tonne per annum processing plant.
- The Lorena Acquisition enables Tombola to fast-track gold production utilising existing cash reserves, and generates free cash flow from production activities to assist with the balance of cash consideration due to the vendor parties.
- Tombola will also undertake studies for the optimisation of gold production.
- Key acquisition terms:
o 5m shares in Tombola at an implied price of $0.06 (A$300,000).
o A$7m cash with A$2m up front and balance over a six to nine month period.
- Completion of the Acquisition remains subject to satisfactory due diligence activities, and Tombola shareholder approval at an EGM to be convened in August 2022.
True North Copper Projects
- Development ready projects covered by Mining Leases at Wallace South and Wynberg to fast-track feed to the Lorena plant.
- Pipeline of advanced exploration tenure covering ground highly prospective for gold only and iron-oxide / iron-sulphide (IOCG / ISCG) copper-gold systems.
Lorena Gold Project
The Company is pleased to advise that it has signed formal legal agreements for the acquisition of 100% of the Lorena Processing Facility ("Lorena"), located only 30km from the Company's flagship Mt Freda Gold Mine in Cloncurry, Queensland (the "Acquisition"), with a A$700,000 discount to the previously agreed terms (refer ASX Release - 20 June 2022).
The Lorena assets include an integrated CIL ("Carbon In Leach") processing facility capable of treating 250,000-300,000 tonnes per annum of ore, a permitted tailings storage facility, an associated tenement package including permitted mining and exploration leases and the existing open cut gold and copper mine.
A summary of the terms for the potential Lorena Acquisition is attached as Appendix A* to this release. A Location Map showing the Company's existing projects and the Lorena project sites is attached as Appendix B*.
Importantly, the acquisition is structured so that it enables Tombola to commence gold production in Q4 CY2022, and utilise its current cash reserves in a more effective way, without incurring large additional capital construction costs that would otherwise be required to build a CIL plant and tailings facility of this size.
Tombola Gold Managing Director, Byron Miles, commented:
"Entering into the formal agreements for the Lorena assets is a pivotal step in Tombola's future of becoming a meaningful Australian gold producer. Importantly, the Acquisition not only allows Tombola to increase gold production as well as undertake gold-optimisation planning studies, but now we will have the capacity to treat various ore bodies with gold and copper in the Cloncurry region.
The acquisition terms were negotiated to allow Tombola to utilise its existing cash reserves and cash flow to fund the cash consideration from near-term gold production, however we have now added a substantial asset to the balance sheet which should allow Tombola to expand faster and minimise dilution for shareholders."
About Lorena
The Lorena Mine and Processing Facility is located 13km from Cloncurry on the Flinders Highway and was commissioned in 2017 by a Joint Venture which included Malachite Resources Limited and Chinova Resources Pty Ltd. Operations continued at Lorena until late 2021, after which it was placed in care and maintenance pending a desire by the owners to sell the operation.
Primarily a Gold CIL Processing facility but with the capacity to treat copper bearing ore, over the coming months Tombola will recommission the plant to treat gold ore from the Golden Mile operations and hand in hand with this, the Company will work closely with the respective authorities to ensure that all requisite approvals are in-place.
Tombola is currently working with several third-party consultants and advisors who are assisting the Company with its plans to recommission and expand the facility.
True North Copper Projects
The Company is pleased to advise that it has signed a binding Term Sheet with True North Copper Pty Ltd (TNC) for the acquisition of various interests in five (5) additional projects around the Cloncurry region. This initiative, together with the Lorena Acquisition and the Company's existing tenements, provides Tombola with a significant regional footprint around its Cloncurry base of operations giving the company a strategic position in a key mineral province.
The TNC portfolio brings three development ready and permitted mine projects. In addition to the advanced projects, the TNC deal brings a large tract of highly prospective exploration ground (refer Appendix D*), part of which lies adjacent to the Mt Freda mining complex.
The Wallace South project, located 39km south of Cloncurry, is a large gold / copper system that the company aims to bring quickly into production to provide feed to the Lorena plant. Likewise, Wynberg is located 20kms south-east of Cloncurry that is also permitted and will look to be brought quickly into production.
Both these projects offer immediate synergies with the existing Tombola operations and will bring greater flexibility and increased production capability into the existing mine-plan.
Tombola Gold Managing Director, Byron Miles, commented:
"Both these acquisitions significantly add to the Tombola development story as we look to fast-track becoming a meaningful gold producer. In addition, the extensive pipeline of exploration projects offers significant upside to increasing the resource base of the Company.
*To view tables and figures, please visit:
https://abnnewswire.net/lnk/57IE9E6U
About Tombola Gold Ltd
Tombola Gold Ltd (ASX:TBA) is a company assembled by experienced, exceedingly well-qualified and all very well rounded team members that have previously floated exploration companies which achieved major resource discoveries and success. Between the Tombola team members, Tombola as a company have well over 100 years of accumulated experience in the mining, exploration and resource sector. Tombola principal objective is to acquire assets to explore for and develop a large IOGC or porphyry deposit funded by low-risk gold production resources. To that end, Tombola has a license covering 970 sq km prospective for gold/copper in the Mount Bryan-Red Banks-World's End area near Burra in South Australia; with strategic agreements with Queensland Mining Corporation.
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