Key Highlights

  • Xenora has entered binding agreements to acquire 100% of the Errolls Gold Deposit from Breakthrough Minerals and a 90% interest in the Limestone Well Project from FireFly Metals.
  • Each Acquisition is priced at $1.2 million of Xenora shares at a deemed issue price of $0.20, subject to 12 months voluntary escrow.
  • A $5 million Placement at $0.20 per share is planned in two tranches, with the second Tranche subject to Shareholder approval.
  • Ray Shorrocks has been appointed Executive Chair, and the current chair, Peretz Schapiro, has resigned.

Xenora Minerals Ltd (ASX:XRA) has entered into binding agreements to acquire two adjoining projects in the Barrambie Greenstone Belt, about 90 kilometres southeast of Meekatharra in Western Australia. The projects cover a combined area of about 115 square kilometres. The company has also announced a change of chair and a $5 million Capital raising to fund an exploration program on the expanded landholding.

Acquisition Terms and Project Locations

Xenora will acquire 100% of the Errolls Gold Deposit from Breakthrough Minerals (ASX:BTM) and a 90% interest in the Limestone Well Project from FireFly Metals (ASX/TSX:FFM). Each vendor will receive $1.2 million worth of fully paid Xenora shares at a deemed issue price of $0.20, subject to 12 months of voluntary escrow. The two projects sit immediately along strike from Solstice Minerals’ (ASX:SLS) Nanadie Copper Project, according to Xenora, which states that the Limestone Well tenements abut the southern portion of the Nanadie discovery and that the Nanadie deposit lies about 6 kilometres along strike.

Xenora describes both projects as under-explored. It says Errolls has shallow high-grade intercepts that remain open at depth and along strike, including 22 metres at 7.46 g/t gold from surface and 11 metres at 6.88 g/t gold from 14 metres. The company notes that historical drilling at Errolls averaged only about 34 metres in depth, and that past production totalled approximately 6,197 ounces of gold at an average grade of 19.01 g/t.

Exploration Plans

Xenora plans 10,000 metres of aircore drilling at Limestone Well, complemented by induced polarisation surveys, to target disseminated sulphide mineralisation concealed beneath shallow transported cover. A further 5,000 metres of aircore drilling is proposed for a first-pass evaluation of structures in the southern portion of Limestone Well, where the mineralised trends associated with Errolls and the Doherty (Barrambie) deposits extend into the tenements. At Errolls, the company says past drilling has focused on the immediate vicinity of the historical workings and has not tested the broader 1.5 kilometre trend associated with the Youanmi splay.

The Limestone Well tenements also contain vanadium and titanium mineralisation associated with ilmenite and magnetite-rich layers, and sit along strike from Neometals’ (ASX:NMT) Barrambie project. Xenora describes its planned program as applying the same exploration model used at Nanadie. The company has noted that all planned activities remain indicative and subject to heritage and permitting requirements.

Placement and Board Changes

The company intends to raise $5 million before costs through a two-tranche placement of 25 million shares at $0.20 each, to sophisticated, professional and institutional investors. The first tranche of 8,682,299 shares will be issued under available placement capacity under Listing Rule 7.1. The second tranche of 16,317,701 shares will be subject to shareholder approval at the general meeting called to approve the acquisition consideration shares. Canaccord Genuity (Australia) has been appointed lead manager, with a 1% management fee and a 4% capital raising fee on placement proceeds, with further securities subject to shareholder approval.

Ray Shorrocks has been appointed Executive Chair. Xenora says he has more than 30 years of experience in corporate finance and resources, and was the founding executive chairman of Bellevue Gold and FireFly Metals. Peretz Schapiro, the company’s previous chair, has resigned. Mr Shorrocks’ engagement terms are set out in an annexure to the announcement.

Closing Perspective

The announcement sets out a consolidated landholding of about 115 square kilometres, a two-stage placement and a drilling plan spanning both projects. Completion of the acquisitions depends on due diligence, regulatory and shareholder approvals, and the FireFly agreement conditions. The planned drilling will test whether the geological analogues Xenora cites translate into mineralisation, and the timing of exploration results will depend on drilling schedules, assays and permitting.