Australia’s largest gold producer Newcrest Mining (TSX: NCM; ASX: NCM) has signed a joint venture (JV) deal with Greatland Gold (LSE: GGP) to continue advancing the Havieron gold-copper project in the Paterson region of Western Australia.
The new agreement builds on the US$65-million farm-in alliance the companies established last year, which has given Newcrest a 40% interest in the U.K.-based miner’s project so far.
The gold giant, who is the joint-venture manager, is now entitled to earn an additional 20% in Havieron, but has the ability to grab up to a 70% of the project.
As part of the deal, Newcrest has agreed to loan US$50 million to its partner to fund early works and drilling at the Havieron project, located 45 km east of the company’s Telfer gold-copper mine, and 500 km east of rail and port infrastructure at Port Hedland.
To further its presence in the prospective Paterson province, Newcrest has also inked a farm-in and JV agreement with Greatland for the latter’s Black Hills and Paterson Range East exploration licenses.
The companies have named that alliance the Juri Joint Venture, to set it apart from the one they have at Havieron.
That arrangement grants Newcrest an initial 25% interest with the potential to earn up to a 75% stake if it invests A$20 million (US$15 million) over a five-year period.
Greatland Gold will manage the Juri JV until the end of calendar year 2021, after which Newcrest will have the right to take over.
Newcrest, which is also the world’s No. 3 gold producer by market value, has been aggressively searching for juniors with appealing assets to jointly develop.
Early last year, it acquired a 70% stake in Canada’s Red Chris copper and gold mine from Imperial Metals (TSX: III).
The Paterson region hosts several large gold and or copper deposits such as Nifty, Winu and Newcrest’s own Telfer.
The world’s second largest mining company, Rio Tinto (NYSE: RIO; LSE:RIO; ASX: RIO), is very invested in the area and its recent application for nearly 30 exploration licenses has sparked a stampede into adjacent lots by other explorers, who see the miner’s aggressive activity as an indicator of a highly promising find.
This article first appeared on Mining.com, part of Glacier Resource Innovation Group.