(MENAFN - ProactiveInvestors - Australia) Mining Projects Group (ASX: MPJ) has plans to farm-in to two nickel and gold prospective tenement packages in the Kambalda and Lake Wells regions of Western Australia, regions that host major new and existing discoveries.
The company has executed a binding Heads of Agreement to establish two separate joint ventures with Oroya Mining (ASX: ORO) for the Roe Hills\Talc Lake Project and the Mt Barrett Project.
The Roe Hills\Talc Lake Project is located in the Kambalda nickel region and provides further expansion to Mining Project Group's existing tenement position within the highly prospective Fraser Range.
The project is located about 50 kilometres northwest of Sirius Resources' (ASX: SIR) Nova nickel discovery.
Meanwhile, the Mt Barrett Project is located in the Lake Wells Region and is an underexplored greenstone belt north of AngloGold Ashanti (ASX: AGG) and Independence Group's (ASX: IGO) 7.9 million gold ounce Tropicana deposit.
Roe Hills\Talc Lake
The Roe Hills\Talc Lake Project covers a 30 kilometre belt of ultramafic rocks, 85 kilometres east of the Kambalda nickel mining centre.
Oroya holds five exploration licences covering the ultramafic sequences.
Four nickel-copper intersections from previous drilling programs at the project have returned low grade mineralisation over 150 metres, as well as high grade intercepts of 0.5 metres of 6.15% nickel and 0.38% copper from 155 metres.
Previous work includes regional geochemistry, aircore, reverse circulation and diamond drill testing, electromagnetic geophysical surveys and induced polarisation surveys.
Gossans, geochemistry, geophysics, petrology and known nickel sulphide positions suggest strong potential for Kambalda-type komatiite nickel deposits.
A review of the project data has identified numerous nickel and gold targets to be evaluated.
The Mt Barrett Project is located in the Lake Wells Region on a highly prospective greenstone belt.
Recent drilling on the immediately adjacent tenement, Goldphyre Resources' (ASX: GPH) Axford Prospect, has returned several high grade gold intercepts.
Gold Road has also discovered significant resources on the belt to the south of Oroya's tenement, and the Tropicana gold deposit containing 7.9 million ounces of gold is under development by AngloGold Ashanti and Independence Group.
Under the terms of the deal, Mining Projects Group will issue Oroya 50 million shares and 30 million options exercisable at 0.01 and expiring on 30 June 2016.
This is to reimburse Oroya for expenditure undertaken at the two projects so far.
Mining Projects Group can earn up to a 75% interest in the Roe Hills\Talc Lake project by spending a minimum of 800,000 during the first 12 months, and then continue to solely fund the project until the completion of a Bankable Feasibility Study or decision to mine.
The company can earn up to an 80% interest in the Mt Barrett Project by meeting all required expenditure until completion of a Bankable Feasibility Study.
Mining Projects Group can withdraw from either or both joint ventures at any time prior to earning its interest.
Once the company has earned a participating interest in either or both joint ventures, Mining Projects Group and Oroya will then contribute to expenditure in proportion to their respective participating interests.
Mining Projects Group also plans to raise up to 1.6 million via a private placement of 200 million shares at 0.008 cents each to professional and sophisticated investors of CPS Securities and Melbourne Capital.
The issue price of the placement represents a 33% premium to the last traded share price of 0.006.
One free attaching option, exercisable at 0.01 and expiring on 30 June 2016, will also be issued for every two shares subscribed in the placement.
The funds raised from the placement will be used to undertake initial exploration programs at the two new projects, as well as the existing recently acquired Fraser Range tenements.
As part of the transaction, Mining Projects Group will also undertake a Board restructure with executive director Richard Revelins, non-executive director Jim Babbage and executive director Phillip Hains standing down on completion.
Joshua Wellich has been nominated by Oroya to join the Board and become managing director following the completion of the transaction.
Wellisch is currently executive director of Oroya and has held several private and public board positions over the past seven years.
He has extensive experience in capital raisings, corporate structuring and public company transactions in the resource exploration sector.
In addition, there will be a further independent director nominated in due course.