Investor interest in RNI NL (ASX:RNI) was piqued yesterday, with...

Investor interest in RNI NL (ASX:RNI) was piqued yesterday, with shares spiking some 13% as plans firmed to sell the company’s gold assets to Metals X (ASX:MLX).

RNI shares were trading steadily today at A$0.017 after the company signed a debt repayment agreement with Taurus Resources No 2 Fund expected to pave the way for the gold sale to Metals X.

Earlier this month, RNI confirmed the reception of $300,000 in the form of an interest-free loan from Metals X as part of the sale. RNI intends to convert the loan into a note convertible into RNI shares at an issue price of $0.02 per share.

The move represents continued momentum in Metals X’s strategy to expand its exposure to the gold space. The Perth-based miner has traditionally focused on base and industrial metals, with its primary interest being the massive Renison tin mine in Tasmania.

Metals X recorded a 45% increase in revenues from gold revenues over FY2015 to $232.8 million. This compared to only $79.6 million in annual revenue from the tin division, and contributed to a 9% year-on-year increase in net profit to $40.9 million.

RNI’s principal gold assets are the Grosvenor and adjoining Peak Hill gold projects in Western Australia, where bonanza results have been marked at up to 586.7 g/t gold within a broader intersection of 10.1 metres at 26.3 g/t gold.

Metals X has agreed to issue RNI with 18 million new fully-paid Metals X shares in consideration for the assets, although the sale remains subject to the finalisation of some legal conditions.

A key advantage of the agreement with Taurus is that it provides a framework for RNI to complete the sale of its gold assets within a suitable timetable.

It also enables RNI to press ahead with an entitlements issue to raise about $5 million to fund part of the Taurus repayment as well as drilling and exploration programs planned for the company’s other high-priority targets across its 1,300-square-kilometre Bryah Basin copper-gold portfolio.

This portfolio includes the Doolgunna Gold Project, where prospectivity is supported by a setting only 5 kilometres along strike from the high-grade Monty copper-gold discovery and about 2.5 kilometres from Sandfire Resources’ (ASX:SFR) DeGrussa copper-gold mine.

Previous exploration work at the site has established high-priority targets within three prospective volcanic hosted massive sulphide corridors.