Sydney, Nov 22, 2005 AEST (ABN Newswire) - NGM Resources Limited (ASX: NGM), ("NGM"), announced that it has signed an agreement with Placer Dome Australia covering the farm-out of NGM's North Telfer Project in Western Australia.
The North Telfer project which comprises over 1,100km 2 of tenements is situated 20 - 80km north of the Telfer gold mine and is believed to be prospective for Telfer-style gold (copper) mineralisation.
NGM's work at North Telfer has included the flying of an aeromagnetic survey and compilation and reinterpretation of previous exploration data. Under the terms of the agreement Placer will conduct a due diligence study over a period of up to one year during which time Placer and NGM will cooperate to sign an acceptable native title agreement to cause the tenements to be granted. At Placer's election, it may then proceed to earn 70% over 5 years for a total expenditure of $2.5 million.
Placer may then elect to earn a further 10% for an expenditure of $1 million by the sixth anniversary of the start of the earn-in period. NGM may contribute its pro-rata expenditure when Placer has earned 70% or 80%, depending on Placer's election.
If NGM's share falls below 10% its interest will be converted to a royalty of 2% Net Smelter Return. NGM is entitled to receive a signature payment on signing of the agreement (now completed) and a further payment on confirmation of Placer's intention to proceed with the earn in phase of the joint venture.
NGM has an established relationship with Placer with its Longtaushan Gold JV in China having been generated through the Guangxi Gold Bureau/Placer strategic alliance.
Contact
Russell Penney
Managing Director
rpenney@ngmresources.com.au
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