East African-focused company Chalice Gold Mines (ASX: CHN) has agreed to sell its interest in the Wilga Joint Venture to AngloGold Ashanti Australia (ASX: AGG) for $20,000.
In addition, Chalice retains a 1.5% Net Smelter Return interest in possible future production capped at $1.5 million.
The Wilga Joint Venture covers Exploration Licence 39/1003 and Prospecting Licence 39/4890 in the Eastern Goldfields of Western Australia, approximately 55 kilometres south of Laverton and 10 kilometres southeast of AGAA’s Sunrise Dam Gold Mine.
These have been subject to a Joint Venture between Chalice and AGAA whereby the latter had the option of earning a 75% interest in the properties by the expenditure of $2 million over four years.
Chalice managing director Doug Jones said despite an intensive exploration program, including a substantial amount of Aircore and Reverse Circulation drilling, no significant gold mineralization was located.
"However large quantities of water were encountered in the drilling and, given the proximity to the Sunrise Dam operation, this is of potential future value to AngloGold," Dr Jones said.
The sale is subject to typical conditions precedent for transactions of this nature and third party, including Ministerial consents.
Also today, Chalice announced it had agreed to invest in the United Kingdom based London Africa, which holds a number of prospecting licences in Eritrea.
The company will subscribe for 1.6M shares in London Africa at 12.5p per share for GBP200,000 (A$358,000) which will give Chalice an 11.8% interest in London Africa.
The funds will be applied to a work program currently being undertaken and managed by London Africa.
The London Africa tenements cover 1,562 square kilometres in the prospective Akordat-Orata area in Eritrea.