Citigold and Native Mineral Resources Enter into Charters Towers Gold JV

Mining & Resources

Citigold signs a gold JV with Native Mineral Resources across 40 Charters Towers tenements, with drilling ahead and a $5m payment tied to production.

Nik HillJournalist · 2 min readIn this storyCTONMRIn briefAt-a-glance3 takeaways

• 01NMR gains exploration rights across 40 Charters Towers tenements; mining depends on drilling results and approvals.
• 02Citigold retains tenement ownership and gets 50% of surplus gold-sale proceeds.
• 03Citigold also receives $5m after 8,000oz is produced.

Citigold Corporation (ASX: CTO) has signed a binding joint venture agreement with Native Mineral Resources (ASX: NMR) covering 40 tenements across its Charters Towers gold project in Queensland.

The arrangement gives Native exclusive rights to undertake exploration and proving-up drilling across the Central, Warrior, and Stockholm areas, with any future mining contingent on drilling results and a subsequent decision to proceed.

Citigold retains ownership of the ground and stands to receive half of any surplus from gold sales after specified costs are recovered, together with a separate production-linked payment.

The agreement, effective from 7 November, supersedes the parties’ September arrangement over Stockholm and brings a much larger part of Citigold’s goldfield portfolio within a single commercial framework.

Broader Goldfield Partnership

The venture covers 30 granted mining leases, one mining lease application, four mineral development licences, and five exploration permits including more than 20,500 hectares of surrounding exploration ground.

Seventeen mining leases lie in the Central area, six at Warrior, and seven at Stockholm, with all three areas within 10 kilometres of Native’s Blackjack operations.

That proximity could allow mineralised material to be transported to Native’s existing Blackjack processing plant if drilling establishes an economically viable mining opportunity and the required approvals are obtained.

The Central and Warrior tenements contain most of Citigold’s reported mineral resources, although about 94% of their contained gold ounces are classified as Inferred and therefore carry a low level of geological confidence.

Citigold’s goldfield database includes more than 3,300 drill holes, but no drilling has taken place since 2016, making the planned verification work an important test of the existing geological model.

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Split Production Duties

Under the commercial structure, Native will control exploration, drilling, mine planning, and any subsequent mining, while Citigold remains responsible for maintaining tenure and applicable environmental authorities.

Native can recover eligible drilling, development, mining, processing, and directly attributable financing costs from gross smelt proceeds, including an 8% margin on its costs.

After Queensland mineral royalties and recoverable costs attributable to both parties are deducted, any remaining surplus will be divided equally between the two.

Citigold would additionally receive a one-off $5 million payment once an aggregate 8,000 fine ounces of gold has been produced from the venture tenements, with that payment excluded from the cost-recovery calculation.

There is no upfront consideration, and Native does not acquire ownership of the tenements under the unincorporated contractual joint venture.

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Drilling to Precede Mining Decision

Native will now plan the drilling sequence, prioritise targets, and assess contractor and regulatory requirements before determining whether mineralisation supports commercial mining.

Following receipt and assessment of the final drilling and assay results, it may elect to proceed with extraction and processing or terminate the arrangement if the results do not justify development.

“The staged approach allows the parties to first establish the potential of the mineralisation through proving-up drilling before committing to mining operations,” Citigold executive chair Mark Lynch said.

“If the results support development, the joint venture provides a practical pathway to bring additional mineralised material into production for the benefit of both companies.”

Citigold previously produced more than 100,000oz of gold through trial mining between 1994 and 2016, including underground operations in the Warrior area.

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Nik Hill

JournalistView all articles

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