EV Resources (ASX:EVR) - Chairman, Luke Martino
Chairman, Luke Martino
Source: EV Resources
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  • Jadar Resources (JDR) signs a deal with Gold Rush Expeditions to acquire the New Standard Copper Project in Arizona, USA for US$600,000 (A$812,458)
  • Three yearly payments of US$200,000 (A$270,800) in cash will be paid to Gold Rush, with Jadar taking a 33.33 per cent stake at each instalment
  • Gold Rush will retain a two per cent net smelter royalty, half of which may be purchased by Jadar for a one-off fee of US$1 million (A$1.35 million)
  • Additional payments of up to US$3.9 million (A$5.28 million) may also be paid to Gold Rush upon the satisfaction of certain milestones
  • Shares in Jadar Resources remained flat today, closing at 3.1 cents

Jadar Resources (JDR) has signed a deal with Gold Rush Expeditions to acquire the New Standard Copper Project in Arizona, USA for a total of US$600,000 (A$812,458).

Located in the Cienega Mining District of La Paz County, roughly 19 kilometres southeast of Parker, the project consists of six lode claims covering 120 contagious acres. Historic workings in the region date back to the 19th Century and provide evidence of copper mineralisation over a 1.5 kilometre strike length.

Privately-held Gold Rush has granted Jadar a three-month period with which to conduct due diligence, at a cost of US$20,000 (A$27,000).

Upon the completion of due diligence, Jadar will acquire 100 per cent of the project by making three yearly payments of US$200,000 (A$270,800) in cash, taking a 33.33 per cent stake at each instalment. Jadar also intends to create a new limited liability company, which will maintain ownership of the project.

Gold Rush will retain a two per cent net smelter royalty, half of which — or one per cent — may be purchased by Jadar at any time for a one-off fee of US$1 million (A$1.35 million).

“Jadar has mobilised a team to commence due diligence in Arizona, which will cover a range of geological, legal, environmental, and other matters related to ESG considerations,” Jadar said in a statement.

“Samples will be collected and analysed by a professional geologist, and planning will start for intensive geological programmes.”

In addition to the purchase payments, Gold Rush will also receive bonuses upon the satisfaction of certain milestones.

Jadar will pay US$750,000 (A$1.01 million) should a maiden Indicated Mineral Resource estimate be declared at a cut-off grade of no less than 1.5 per cent copper.

A further US$750,000 (A$1.01 million) will be paid upon the completion of a Pre-Feasibility Study with a post-tax, ungeared Internal Rate of Return (IRR) of no less than 25 per cent.

Another US$1 million (A$1.35 million) will be paid to Gold Rush once the project is ready to mine, with a final US$1.4 million (A$1.9 million) payment to be made once commercial production begins, defined as the production and sale of 5000 metric tonnes of copper in ore, concentration or metallic form.

Jadar made a visit to the New Standard site in September this year, accompanied by a geologist from SRK Consulting in Reno, Nevada. According to historical reports lodged with the Arizona Geological Survey, workings extend to a depth of around 120 metres, with development measured to a depth of 38 metres.

While the old shafts were not accessible for safety reasons, Jadar said the evidence of outcrop on strike will help to define drill targets.

“No modern exploration has been undertaken in the area and Jadar intends to commence a programme of mapping, sampling, geophysics before moving rapidly to drill testing,” the company said.

Shares in Jadar Resources remained flat today, closing at 3.1 cents.

JDR by the numbers
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