Australia Gold - Joint Venture Update

RNS Number : 8589Q

Red Rock Resources plc

24 June 2020

 

Red Rock Resources PLC

("Red Rock" or the "Company")

Australia Gold - Joint Venture Update  

24 June 2020

Red Rock Resources Plc, the natural resource development company with interests in gold, manganese and other minerals, is pleased to announce an update on its joint venture subsidiary Red Rock Australasia Pty Ltd ("JV" and "RRAL").

Update on licence applications:

RRAL's applications are shown on the tenement map for Victoria and are being processed by Earth Resources Victoria. The process of grant has several stages, and the increase in application activity and the Covid-19 virus have caused delays and a backlog. Although the Company understands that measures are being implemented to ensure that processes are carried out as far as possible on a normal timetable, it is likely that some at least of RRAL's applications will not proceed to grant for some time. 

RRAL expects that it will be able to prioritise the grant of certain key application areas, but its planning including planning for a possible listing does not rely on assumptions about the timeframes for grant.

RRAL's licence applications cover areas with different targets and target types. Although these may be described as RRAL's strategic footprint in the Victoria Goldfields region, the ten licences covering up to 1,835 sq km in one of the most sought after gold exploration territories are not expected to be granted and explored on the same timeframe, and the assumption is that the sequential grant of these licenses will create an exploration pipeline.

It is considered unlikely that RRAL will lodge any further applications for additional licences at this time, as each of the ten tenements applied for contains valid exploration targets.

However, RRAL is also considering potential corporate transactions to acquire granted licences where immediate ground exploration is possible, which would complement the application portfolio.

Historical Exploration Database and Exploration Planning:

RRAL is working with geological advisors based in the Victoria Goldfields area who are undertaking a review of historical exploration, previous recorded production and known deposits across all ten licence application areas.

The information gathered is being collated into a geological database to provide the basis for additional target generation and detailed exploration planning.

Compliant Technical Report:

RRAL expects to commission the production of a technical report meeting the requirements for public release and covering the Victoria land package, its prospectivity for gold mineralisation and forward exploration strategies.

Strategic Project Development:

RRAL has various strategic options for corporate and operational development of its Victoria Goldfields interests. The baseline route would be to secure licence grants and for RRAL to explore and develop each licence internally with its own work programme.

Other options include RRAL securing external joint venture partners and as the licence applications cover several target types and areas it would be possible to take separate approaches with individual exploration licenses.

Prior to any strategic decisions being taken it is important to maximise our understanding of each licence and its prospectivity to enable the correct approach to be taken for each and if relevant to enable RRAL to structure suitable corporate transactions. As a result early completion of the historical exploration database is very important.

It is however recognised that alongside internal exploration and development by RRAL, involvement of third parties could enhance project level financing and so support an accelerated timetable for activity on the ground as licence applications are granted and exploration approvals obtained.

One further option being considered by RRAL is a possible initial public offering ("IPO") for RRAL on a North American stock exchange for some, or all, of the project footprint. RRAL is in discussions with potential advisors in this regard.

Red Rock Chairman Andrew Bell comments :

"The Company is considering with its partner Power Metal Resources and with its advisors in Australia and North America how best to take forward its joint venture company Red Rock Australasia Pty Ltd. Against the backdrop of the rapidly evolving situation in the Goldfields, and wishing to maintain the momentum the Joint Venture has established by the rapidity with which it has built its position, we have concluded that we should set in motion an immediate review of all options including the possibility of seeking a public listing for the JV as an independent specialist gold vehicle. In the Board's view an IPO could be an effective way to demonstrate the value of the RRAL JV by creating a public market in its securities.

Developments will be reported as they occur. "   

Further Information:

RRAL is a joint venture company 50.1% owned by Red Rock and 49.9% by POW. Paul Johnson, CEO of POW, and Andrew Bell, Red Rock and POW Chairman, are directors of RRAL.

The JV license application areas of RRAL in Victoria cover 1,835 sq km  in the Goldfields area as follows:

Ø EL007271 Blue Whale  133 sq km

Ø EL007281 Blue Chip    74 sq km

Ø EL007282 Blue Sky    499 sq km 

Ø EL007285 Blue Ribbon  8 sq km

Ø EL007294 Red Queen  130 sq km

Ø EL007301 Mt Bute    85 sq km

Ø EL007327 Blue Stocking  60 sq km

Ø EL007328 Blue Yonder  168 sq km

Ø EL007329 Evergreen  486 sq km

Ø EL007330 Blue Angel  202 sq km

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

For further information, please contact:

Andrew Bell 0207 747 9990  Chairman Red Rock Resources Plc

Scott Kaintz 0207 747 9990  Director Red Rock Resources Plc

Roland Cornish/ Rosalind Hill Abrahams 0207 628 3396  NOMAD Beaumont Cornish Limited

Mark Treharne 0203 700 2500   Broker Pello Capital Limited

 

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