Royal Resources has signed an agreement to sell its Fields Find iron and gold tenement package in Western Australia to Mount Gibson Iron for a cash payment of USD 500,000.
In addition, Royal may receive two mutually exclusive milestone payments of USD 200,000 each on Mt Gibson attaining sales of 1 million tonnes of iron ore from the project area within 10 years and on attaining sales of 10,000 ounces of gold, from the project area within 10 years.
Proceeds from the sale will be used to advance the flagship Razorback Premium Iron Project in South Australia.
Razorback is part of the Red Dragon Venture, a very large magnetite deposit located about 240 kilometer north northeast of Adelaide.
The project includes over 1,450 square kilometer of exploration tenement containing an exploration target of 4.8 billion to 8 billion tonnes at grades of 18% to 45% iron.
Red Dragon also hosts a JORC Resource of 3 billion tonnes at 21.8% iron. It is located in an infrastructure rich area that has access to nearby existing open user rail, port, power, gas, heavy engineering and dormitory towns.
The resource is a bedded magnetite that is significantly softer than banded iron formation ores and expected to be lower cost to mine and beneficiate.