Batangas on the “fast track” after Bluebird cash injection
Red Mountain Mining (ASX:RMX) says work at the Batangas gold project in the Philippines will be put on “fast track” after it finalised a long-awaited deal with Bluebird Merchant Ventures.
Now that Bluebird has finished its listing process on the London exchange, it has paid RMX a total of $US1.7 million ($A2.35 million) in exchange for 25% of the project – effectively valuing the project at about $A9.3 million.
In addition, Bluebird has paid interest and costs accrued by the Batangas JV totalling roughly $A218,000.
The plan from here will be to complete a pre-feasibility study on the project, which is expected to take into account lower energy input costs due to the lower cost of diesel.
Then the JV will start drilling at the project to inform a definitive feasibility study, and then gain approvals from the Philippine government for permitting inputs.
RMX managing director Jon Dugdale told investors that now the Bluebird cash had been receieved, it was in a position to “fast track” the project.
“Now the Batangas JV is operational, and funded, we can bring together all the work over the past 12 to 18 months to fast track completion of the development studies and permitting,” he said.
About the Batangas gold project
The funding is going towards a definitive feasibility study and drilling at the Batangas Gold Project in the Philippines.
Total mineral resources at Batangas sit at 2.97 million tonnes @ 2.4 grams per tonne gold for 227,000 on an indicated basis, and 3.22MT @ 2.1g/t for 218,000oz on an inferred basis.
The Lobo area features 82,000 oz on an indicated and inferred basis – including the South West Breccia mine, which will be the first start-up mine at the project.
Free cash flow from production of the first 100,000oz is expected to be $45 million.
Capex at this stage is expected to be $15 million, a figure set out in a scoping study and feasibility update, but a definitive feasibility study would add more certainty around the numbers.