(MENAFN - ProactiveInvestors - Australia) Ferrowest (ASX: FWL) is acquiring a package of 11 exploration and prospecting licences that are prospective for gold and nickel close to the historic Marvel Loch mining area, Western Australia.
The licences, collectively known as the Marvel Loch Project, are held by Urban Minerals, which Ferrowest is acquiring, and form part of the company's new strategy to diversify project risk by pursuing multiple commodities and projects with short and medium term upside potential.
The Marvel Loch Project consists of 7 granted exploration licences, and 4 granted prospecting licences with a combined area of 156.4 square kilometres.
Gold was first discovered in the area in 1906 and the area has since been the source of extensive gold and nickel production. The
Initial desk top studies have identified a number of potential gold and nickel anomalies that provide immediate exploration opportunities.
While Ferrowest remains confident of its cornerstone Yogi Mine Project and the Eradu MPI Project, it is also keen to add some further short and medium term upside potential through targeted exploration in a few key commodities.
Ferrowest is acquiring Urban for A42,000 in cash and A60,000 in shares priced at the 10 day VWAP prior to the date of issue of the shares.
This is subject to shareholder approval as director Graeme Johnston has an interest in Urban though he has not participated in either the negotiation of the agreement with Urban or the decision of the Board to acquire Urban.