Heron, Barrick launch $1.5m gold project farm-in Charlotte...

Heron, Barrick launch $1.5m gold project farm-in

Charlotte Dudley -MINING NEWS -
Wednesday, 14 May 2008

HERON Resources has teamed up with Barrick Gold’s Kalgoorlie subsidiary in a farm-in agreement to develop Heron’s Kanowna South project, north of Kalgoorlie.

The farm-in will see Barrick (Kalgoorlie), a wholly-owned subsidiary of Canadian miner Barrick Gold, spend up to $1.5 million over four years on the project to earn an 80% interest in Kanowna South.

Barrick must commit a minimum $150,000 in the first year, followed by $1.35 million over the next three years, however it may opt to withdraw after the first year.

Upon Barrick earning its interest at Kanowna South, Heron has the right to contribute as a 20% joint venture partner or to dilute to a net smelter royalty.

The farm-in agreement relates to gold rights only and Heron will retain all rights to non-gold mineralisation.

Consisting of 12 granted prospecting licences, the Kanowna South project lies 3km from Barrick’s Kanowna Gold operation.

Heron managing director Mathew Longworth said Barrick was “the obvious choice” for any shared venture at Kanowna South and described the farm-in as a win-win for both parties.

“It gives us exposure to what Barrick’s going to be doing on that ground,” Longworth told MiningNews.net.

“And it’s quite close to their Kanowna processing operations, so it gives us the opportunity to leverage off discoveries. And because of its proximity, those discoveries don’t have to be huge stand-alone operations.”

He added that Barrick was ready to pursue drill targets at Kanowna South.

Heron is already involved in JV agreements with global majors BHP Billiton and Vale over its nickel prospects in Western Australia.

Shares in Heron rose 1.5c to 48c.