(MENAFN - ProactiveInvestors - Australia) Sovereign Gold (ASX: SOC) has secured an increase in funding to A21 million from China's Jiangsu Geology and Engineering Co to fast track exploration of the company's gold tenements in New South Wales.
Sovereign Gold and Precious Metal Resources (ASX: PMR), which is 81% owned by Sovereign, have entered into further cooperation and investment agreements with Jiangsu to contribute an additional 15 million towards exploration on a number of Sovereign Gold's New England tenements.
The initial agreement between the companies provided for 6 million in exploration funding.
Jiangsu will commit a dedicated team of up to 14 geologists, geochemists and geophysicists to work with Sovereign Gold on the projects.
The Chinese state-owned enterprise will be entitled to a 30% interest in each respective tenement upon meeting the associated expenditure commitment for that tenement.
Sovereign Gold has nine exploration licences covering 2,640 square kilometres including the historic Rocky River-Uralla Goldfields.
The company also has four exploration licence applications over 1,200 square kilometres.
Sovereign has identified the potential for an intrusion-related gold system (IRGS), outlining an exploration target of 0.5 to 2 million ounces of gold.
Eastern Australia has potential for the discovery of further IRGS within the New England Orogen/Tasman Fold Belt.
The large gold mineralised system discovered by Sovereign Gold extends for at least 11 kilometres from north to south and 6.5 kilometres from east to west.