Key Highlights

  • GIB holds a 1% net smelter Royalty on any mineral production from exploration licence E69/3401, which forms part of Terra Metals' Dante Project.
  • GIB received a letter on 6 November 2026 from lawyers acting for Terra Metals stating that the scope of the royalty is in dispute.
  • Terra Metals accepts the existence of the 2018 royalty, but says no Mining has commenced and no royalty is currently payable.
  • GIB lodged an absolute caveat over E69/3401 on 25 February 2026, a step that Terra Metals disputes.

GIB Mining Limited (ASX:GIB), formerly Gibb River Diamonds Limited, has issued an update on a 1% net smelter royalty it holds over exploration licence E69/3401 in the Musgrave Region of Western Australia, dated 10 November 2026. The royalty stems from a 2018 sale option agreement, and the tenement is being explored by Terra Metals Limited (ASX:TM1) as part of its Dante Ti-V-Cu-Au-PGE Project. The update confirms that the scope of the royalty has become the subject of a dispute, a position also reflected in an updated tenure disclosure issued by Terra Metals.

Origin of the royalty

GIB announced the sale option agreement on 31 May 2018. Under it, GIB is entitled to a 1% net smelter royalty on saleable minerals recovered from the licence in commercial quantities. Terra Metals' wholly owned subsidiary, 97992001 Pty Ltd, is the registered holder of E69/3401 and is party to a 14 May 2018 agreement with POZ Minerals Limited, now GIB Mining. The royalty only becomes payable if mining commences on the tenement.

GIB says it has been seeking to update the sale option agreement into a full set of legal documents covering the expressed and implied terms of the original arrangement. The company describes this as standard industry practice when an exploration project progresses toward a potentially commercial discovery.

Letter, dispute and caveat

On 6 November 2026, GIB received a letter from lawyers acting for Terra Metals. The letter stated, among other things, that the scope of the royalty is in dispute. Terra Metals' tenure disclosure, dated 9 November 2026 and attached to GIB's update, says the company accepts the royalty under the 2018 agreement and that the dispute concerns additional claims GIB has made beyond those terms.

On 25 February 2026, GIB lodged an absolute caveat over E69/3401, which Terra Metals disputes. According to Terra Metals, the caveat does not affect the subsidiary's title to the licence or current exploration, but it may restrict the registration of future dealings or encumbrances while it remains in place. A further royalty deed proposed by GIB in June 2026 has not been agreed or executed by either party.

Exploration significance of the tenement

Terra Metals reports that E69/3401 hosts the Southwest discovery and portions of its Basal Reef Mineral Resources. The tenement sits within a project where the company has reported a series of drilling results since late 2025, including intercepts announced in October 2026. GIB's update describes the exploration as having achieved considerable success, while noting that the royalty is linked to the tenement's future production rather than current exploration results.

The economic value of the royalty therefore depends on whether the project progresses to mining and on the metals ultimately recovered. No timetable for mining has been disclosed in either announcement, and Terra Metals notes that no mining has commenced.

Risks and open questions

The central uncertainty is the scope of the royalty. Terra Metals accepts the 1% royalty under the 2018 agreement but disputes GIB's wider claims, while GIB states it is confident in its legal position. The two sets of positions are on the public record without a resolution date. Until the matter is resolved, the caveat could limit financing or sale Options for the tenement, which Terra Metals has noted could affect future dealings with the licence.

For GIB shareholders, the royalty remains a contingent asset with no current payments. Its eventual value would depend on mining decisions, production volumes, Commodity prices and the outcome of the dispute, none of which can be determined from the current disclosures.

Final Word

The GIB royalty remains contingent, with no payments due until mining begins on E69/3401. The dispute centres on whether its scope extends beyond the 2018 agreement, and both companies have set out their positions. Any change in the situation would depend on negotiations or a legal outcome that neither company has tied to a date.