Caprice Resources Gold Play Sends Share Price Higher (ASX:CRS)
Base metals explorer Caprice Resources Ltd’s [ASX:CRS] share price has soared this morning after announcing it will acquire the Island Gold Project, located in WA.
CRS becomes the latest metals explorer to announce its foray into gold exploration, with gold comfortably above the US$2,000 mark.
The CRS share price has been gathering momentum since late May, though it is not clear why as the company had not made an announcement since April.
At time of writing the $7.25 million capped explorer was up 76%, with the CRS share price trading at 44 cents per share.
Caprice to acquire Goldview
The Island Gold Project is located in the Cue Goldfield.
If that name sounds familiar, it should.
Musgrave Minerals Ltd’s [ASX:MGV] gold project is situated in the same province.
As part of the deal, CRS has entered into a binding terms sheet to acquire Goldview Metals Pty Ltd.
Though the deal is subject to shareholder approval, given the share price response the greenlight seems likely.
CRS will pay $100,000 up front for its new digs and issue 16,680,000 shares to Goldview shareholders.
CRS will also pay a 1.5% royalty on net profit to Goldview’s major shareholder, who will also be appointed non-executive director.
What does CRS get?
Let’s take a look at what investors get.
There are currently ~30 million shares on issue.
CRS plans to issue about 50% more shares.
Although shares have rocketed, current shareholders may have their holding diluted significantly.
Not the worst thing ever.
But in return they get a shot at owning a high-grade gold resource in a richly endowed area.
Historical drilling at the site between 2010-2016 included the following highlights:
- 0m at 14.9 grams of gold per tonne (g/t) from 77.0m
- 0m at 6.8g/t from 24.0m
- 0m at 10.5g/t from 75.0m
- 0m at 17.3g/t from 8.0m
- 0m at 24.3g/t from 27.0m
- 0m at 7.6g/t from 26.0m
So high grades and close to the surface.
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There had also been production between 1897–1903, extracting around 54,000oz at 40.0g/t.
According to CRS, the land has been held privately since 1993, during this time very little exploration has taken place.
However, the surrounding area is quite active.
Evolution Mining Ltd [ASX:EVN] committed $18m to exploration nearby.
And two operating gold mines owned by Ramelius Resources Ltd [ASX:RMS] and Westgold Resources Ltd [ASX:WGX] are located within 40km of the project.
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