Australian mining company South32’s subsidiary (South32) has signed an earn-in deal with Ridgeline Minerals to acquire up to an 80% interest in the latter’s Selena project in Nevada, US.
The deal is pending approval from the TSX Venture Exchange.
South32’s potential stake is contingent upon funding exploration expenditures and making cash payments over a specified term.
To earn an initial 60% interest, South32 must provide Ridgeline with a $100,000 execution payment and commit to a minimum of $10m in exploration expenditures over five years.
This includes a guaranteed $2m within the first two years and an additional $500,000 cash payment by the fifth anniversary.
Ridgeline will continue to operate the project during this phase and will receive a 10% management fee on qualifying expenses.
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The agreement outlines a technical steering committee with representatives from both companies to oversee the exploration progress.
If the first option is exercised, the Australian company will acquire a 60% interest through equity in the entity holding the Selena project.
A second phase allows South32 to increase its stake to 80% by funding another $10m over three years, with the option to assume project operatorship.
Should South32 decide to pursue the second phase, it has to arrange a debt facility for Ridgeline to fund its share of mine development costs.
Ridgeline president, CEO and director Chad Peters said: “We strongly believe that Selena represents a significant exploration opportunity in the base metal sector and South32 is the ideal partner to help us quickly advance and de-risk our high-grade CRD discovery at Selena.
“Ridgeline’s combined earn-in agreements between South32 and Nevada Gold Mines now provide up to $60 million in potential exploration expenditures across the Selena, Swift and Black Ridge projects.
“Furthermore, all three earn-in agreements retain non-dilutive, debt financing options that will effectively carry Ridgeline’s 20% to 25% interests in the respective projects should they proceed to production.
“Ridgeline’s portfolio now offers a compelling mix of leveraged discovery potential through our three partner projects, as well as 100%-owned upside through our exploration pipeline of projects, led by our flagship porphyry copper project at Big Blue.”
In May 2024, South32 signed an earn-in deal with Hammer Metals for a stake in the Isa Valley project in Queensland.
