SML 0.00% 5.0¢ synergy metals ltd

kalgoorlie acquisition & joint venture

  1. 236 Posts.
    Kalgoorlie Acquisition & Joint Venture


    HOMEX - Perth


    Synergy Metals Ltd is pleased to announce that its 100% owned
    subsidiary, Synergy Exploration NL, has acquired a 51% interest in
    two unique gold projects located at Kalgoorlie, Western Australia.
    Shareholder approval will be sought for the transactions, which are
    described in further detail below.

    Synergy Exploration NL ("Synergy") has entered into a joint venture
    agreement with Cossack Resources Pty Ltd ("Cossack") and its nominees
    whereby Synergy acquired 51% of the West Kalgoorlie and Seven Mile
    Hill projects.


    The West Kalgoorlie project comprises 1647 hectares and is located on
    the western edge of the City of Kalgoorlie/Boulder in the gold rich
    province of the Eastern Goldfields, one of the world's major gold
    mining centres. The project consists of 12 tenements numbered from
    P26/3151 to 3162 inclusive, and encompasses a number of gold mines
    previously worked during the early 1900's. The mining tenure adjoins
    the giant North American gold producer Barrick Gold's Super Pit
    operations and the highly prospective mining tenements of Australian
    producer Croesus Mining NL.


    The Seven Mile Hill project is situated on P15/4547, some 14km west
    of Kalgoorlie and adjoins Croesus Mining's current mining operations
    at Binduli. This tenement has an area of 155 hectares and abuts the
    Rand Mining NL and Tribune Resources NL's Seven Mile Hill Joint
    Venture which has reported that it has identified 16 targets by
    regional aeromagnetic survey flown over this region.


    The West Kalgoorlie and the Seven Mile Hill projects give Synergy a
    strategic holding in the centre of the gold rich mineralisation area
    in Kalgoorlie, Australia's most outstanding gold mining location and
    an area that has provided exploration success for numerous major and
    junior mining companies.


    Subject to shareholder approval, Synergy will pay the following
    acquisition costs to Cossack to acquire the initial 51% interest in
    the tenements: a cash payment of $50,000 and the issue of 50 million
    options in Synergy Metals Ltd within three months of shareholder
    approval; or if the issue of options is not approved by shareholders,
    an additional cash payment of $100,000.


    The payments described above will also give Synergy the first right
    to purchase the remaining 49% of the interests in the mining
    tenements. Synergy's first right to purchase the remainder of the
    project will be for $1.4m in either cash or shares to be agreed by
    Cossack. Included in the agreement, Synergy also has the first right
    to purchase Cossack's royalty of $2.50 per tonne of ore mined.

    Synergy will be obtaining all historical and closed/open file data
    from the Department of Mineral and Petroleum Resources to assess
    previous exploration reports and to further enhance new
    interpretations for future exploration. Synergy and Cossack will seek
    shareholder approval to the transactions, and will comply with all
    requirements of ASX, ASIC, and any other relevant regulatory


    On 29 July 2002, the company announced that it intended acquiring the
    Daltons Project, subject to shareholder approval. On 25 October 2002,
    the company issued a notice of meeting for a shareholders' meeting to
    be held on 27 November 2002, which inter alia, included a resolution
    for shareholders to vote on the proposed acquisition of the Daltons

    As a consequence of today's announcement in relation to the West
    Kalgoorlie and Seven Mile Hill tenements, the directors have decided
    not to proceed with the acquisition of the Daltons Project, and
    accordingly have withdrawn that resolution from the shareholders'
    meeting to be held on 27 November 2002.

    All other resolutions included in the notice of meeting will be voted
    on at the shareholders' meeting.

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