Larvotto Resources inks gold offtake deal with Glencore

Australia’s Larvotto Resources (ASX: LRV) has signed an offtake agreement with Glencore (LON: GLEN) for its 100%-owned Hillgrove gold-antimony project in New South Wales.

The agreement covers gold concentrate production during the first seven years of mining operations, with expected annual offtake being approximately 15,000 dry metric tonnes, Larvotto said in a press release on Tuesday.

The agreement is structured on a mine-gate basis, with Glencore responsible for all logistics from the mine to the final customer destination.

Together with the antimony concentrate offtake with Wogen Resources, the agreement completes the company’s key concentrate marketing strategy for Hillgrove’s primary concentrate products, it said.

“As we move closer to first production at Hillgrove, securing a globally recognized offtake partner for our gold concentrate is another important milestone in the transition from development to operations,” managing director Ron Heeks stated in the press release.

“As expected with the strength in the gold price, there was a high level of interest for the offtake during the tender process from all major commodity houses.”

Last year, the company reported 90% tungsten recovery with a 16X increase in feed grade delivered in metallurgical testwork, which it said also indicates a simple and cost-effective processing circuit would produce a saleable tungsten concentrate.

“Metallurgical testwork continues for the potential production of a tungsten concentrate by-product from Hillgrove, with offtake discussions expected to progress as development activities advance,” Heeks said.

First production at Hillgrove remains on time and budget, with commissioning expected in August this year, the company said.

Larvotto’s stock traded flat on Tuesday. The company has a A$690.3 million ($485 million) market capitalization.