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- New World Resources (ASX:NWC) has signed an agreement with SW Metals for the right to acquire the Antler copper project in Arizona
- The four-year Option and Purchase Agreement will allow New World to acquire 100 per cent interest in the historic project
- Around 70,000 tonnes of ore were mined at Antler between 1916 and 1970
- According to the company, existing infrastructure and advanced exploration will allow for low capital expenditure to reach production
- New World plans to begin a maiden drilling program this quarter, after completing due diligence
- Company shares are trading 14.3 per cent higher, for 1.6 cents each
New World Resources (NWC) has entered an Option and Purchase Agreement with SW Metals for the historic Antler copper deposit.
The four-year option agreement will allow New World to acquire 100 per cent interest in the deposit in Arizona.
Historic Antler deposit
Antler was mined between 1916 and 1970 during which it produced 70,000 tonnes of ore.
New World Resources Managing Director Mike Haynes said this historic mining produced attractive grades.
“Mineralisation has been mapped at surface over a strike length of 750 metres and thick, high‐grade mineralisation has been intersected in drilling more than 400 metres down‐dip from the historically mined ore.”
“Immediately after mining last ceased, considerable high‐grade mineralisation was delineated with closely‐spaced drilling in the lower levels of the underground workings. Yet nothing has been done at the Project since 1975. This provides us a near‐term production opportunity,” he said.
The deposit has a historic Mineral Resource estimate for the remaining mineralisation comprising of 4.66 megatons at 1.95 per cent copper, 4.13 per cent zinc, 0.94 per cent lead and 35.9 grams per tonne of silver.
Antler’s existing infrastructure along with other factors will allow production to be reached in the near future.
“Given the project’s location – on private land in a remote region of north‐western Arizona – a state which accounts for around 70 per cent of U.S. copper production – the Antler Project offers a streamlined permitting framework which should see us gain rapid access for drilling, which is scheduled to commence later this quarter,” said Haynes.
Option and Purchase Agreement
Under the Option and Purchase Agreement executed with SW Metals, New World has the right to acquire 100 per cent of two patented mining claims which encompass the Antler Deposit. This is in addition to 100 per cent of seven unpatented claims surrounding the Antler deposit.
New World has until March 8, 2020, to complete due diligence. Subsequently, the company plans to proceed with a maiden drilling program.
The four-year option agreement comprises of a US$50,000 (~AU$72.56) option payment for the right to conduct exclusive due diligence.
After closing due diligence, New World can extend the option by a further six months by paying US$50,000 (~AU$72.56).
For each closing anniversary thereafter, it will cost the company US$75,000 (~AU$108.84) to extend the option a further 12 months.
To maintain its option New World committed to paying minimum work and expenditure for the project, including payments SW Metals agreed to make for the purchase of the two patented claims.
This will equate to a cumulative expenditure of US$3.5million (~AU$5.08 million) within four years from closing due diligence.
New World may exercise its option for US$1 million (~AU$1.45 million) and pay the vendor the same sum again within two months of commencing production and ten monthly payments of US$100,000 (~AU$145,120).
The vendor would also be entitled to 10 per net proceeds interest in the pre-tax cash flows after New World has recouped 100 per of the options costs and initial capital required to bring the project to production.
At any time New World can, however, purchase 100 per of the SW Metals net proceeds interest for US$10 million (~AU$14.51 million).
Shares in New World Resources are trading 14.3 per cent higher, for 1.6 cents per share at 1:49pm AEDT.
