Highlights
- Option to be granted to Colossus Resources Corp. (“Colossus”) (TSXV:CLUS) to purchase Austral’s Chilean Calvario and Mirador copper projects, previously acquired through the takeover of Revelo Resources Corp in 2021.
- Consideration comprised mainly of (i) a US$2.5 million work commitment over a two-year period, (ii) 19.99% shareholding in Colossus (non-diluted basis), (iii) one million Colossus warrants at an exercise price of C$0.50 and anti-dilution rights up to Colossus raising US$3.8 million.
- Additional payment of two million Colossus common shares if Colossus prepares a prefeasibility study.
- Colossus to complete an equity financing for proceeds of not less than US$1.5M within 90 days after the date of the Agreement and any required regulatory approval.
- Austral would become the largest shareholder of Colossus.
Established gold producer Austral Gold Limited (Austral or the Company) (ASX: AGD; TSX-V: AGLD; OTCQB: AGLDF) and Colossus Resources (“Colossus”) (TSXV:CLUS) signed a definitive agreement (“Agreement”) to grant Colossus an option to purchase Austral’s Chilean Calvario and Mirador copper projects (collectively, the “Projects”). The Agreement follows the initial media release on 5 April 2023, which provided exclusivity to Colossus through a Letter of Intent (“LOI”) and the payment of US$100,000.
The Projects are early-stage copper exploration projects located approximately 80 km northeast of the coastal city of La Serena in the Coquimbo Region of central-northern Chile in South America, approximately 700 km from the Austral Group’s Guanaco-Amancaya mine complex.
Grant of the Option is subject to conditions, including, the necessary approval of the transaction by the regulatory authorities, and certain undertakings from Colossus, including the requirement that Colossus complete an equity financing in which it raises at least US$1.5M within 90 days after the date of the Agreement.
Austral Gold’s Chief Executive Officer, Stabro Kasaneva said: “Further to the letter of intent signed earlier this year, Austral is pleased to execute a definitive agreement with Colossus. The agreement offers potential upside for the Company, enabling Austral to focus on its core gold assets across production and exploration, while still sharing in the potential success of the Calvario-Mirador copper projects in Chile as the largest shareholder of Colossus.”
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