Austral Gold (ASX: AGD) (TSXV: AGLD) and New Dimension Resources (TSXV: NDR) have entered into an agreement for Austral to purchase an 80% interest in New Dimension’s Sierra Blanca gold-silver project in Argentina.
The deal demands that Austral pays $800,000 in cash and work commitments, with a ‘follow-on’ option to purchase the remaining 20% interest for an additional $2.3 million in cash and work commitments.
In a press release, the Australian miner said that with this transaction, it will expand the area of its Pingüino project by securing an additional 7,000 hectares, resulting in a new exploration cluster in the southern province of Santa Cruz.
Pingüino is a silver-gold-zinc-lead-indium advanced-stage development project located in the south-central part of Argentina, while the nearby Sierra Blanca is an early-stage project where previous work had mostly been focused on the E-W-trending Chala-Achen and Lucila vein systems. According to New Dimension, surface channel sampling at Chala-Achen yielded high-grade silver values, including 9.4m @ 2,362 g/t Ag.
“We see strong synergies between the Sierra Blanca project and our Pingüino project. Both projects are located in the geological zone of Deseado Massif in the Santa Cruz Province, one of the most prominent precious metal regions in the world, including world-class deposits such as Cerro Vanguardia and Cerro Negro,” Austral’s CEO, Stabro Kasaneva, said in the media brief.
“We expect that the acquisition of Sierra Blanca will enable us to increase the value of our Pingüino project by drilling additional targets that can potentially increase our mineral resource base in this region.”