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NEWS

Gascoyne gobbles up Firefly

by Michael Washbourne

eborn miner Gascoyne Resources Ltd is on the cusp
Rof joining the exclusive 100,000 ozpa gold producer’s
club after agreeing to a $159 million merger with Firefly
Resources Ltd.
Gascoyne announced in mid-June it was set to acquire 100%
of the fully paid ordinary shares in Firefly via a scheme of
arrangement which will see shareholders of the latter emerge
with 32.6% of the combined group.
The centrepiece of the transaction is Firefly’s Yalgoo project,
about 110km by road from Gascoyne’s 2.5 mtpa Dalgaranga
processing plant, which is forecast to churn out 70,000-80,000
ozpa gold over the next three years.
Based on the financial positions of both companies at the end of
Gascoyne is set to grow production at Dalgaranga after
the March quarter, the combined entity will hold $33 million cash
acquiring Firefly’s nearby Yalgoo project
and bank debt of $17.5 million upon completion of the merger
which is on track for October – effectively a full 12 months since
Gascoyne was reinstated to the ASX following a lengthy period in “Melville is the key deposit and represents less than 1km of the
voluntary administration. 28km continuous shear zone from the town of Yalgoo to the
Gascoyne managing director Richard Hay said regional north,” Lawson said.
consolidation around Dalgaranga, about 65km west of Mt “We’ve developed a strong working relationship and a lot of trust
Magnet, has been critical to the company’s strategy since its with the Gascoyne team through the due diligence period and we
shares resumed trading. believe that can all be leveraged…on top of the hugely efficient
“This merger is a major step forward for Gascoyne in accelerating low-cost processing plant already in place, the experienced team
working together and a good culture which I’m hoping to grow as
our strategy to increase mine life, increase production profile and
build and grow our resource inventory,” Hay said. we move forward.”
“Firefly’s Yalgoo gold project is highly complementary with With combined resources of 1.4 moz and reserves of at least
Dalgaranga. It brings to the table 685sq km of tenure around 339,000oz at its disposal, Gascoyne will nudge the 100,000 ozpa
Yalgoo, all located within 80km of Dalgaranga. That actually mark once Melville is introduced into the Dalgaranga production
increases the total regional land package to almost 1,200sq km profile.
across the two greenstone belts of Dalgaranga and Yalgoo, with Hay is also keen to sink some exploration dollars into up to
a further 1,050sq km that are pending applications.” eight advanced targets around Yalgoo, as well as the pipeline of
Yalgoo hosts the shallow Melville resource (196,000oz @ 1.45 untested prospects in Gascoyne’s existing portfolio.
g/t gold) which Gascoyne is seeking to put into production by the “This is the first time the Yalgoo and Dalgaranga greenstone belts
first quarter of FY2023, subject to further technical studies and have been consolidated under one ownership,” he said.
regulatory approvals. “I must take my hat off to Simon and his team because the
A mining licence is expected to be submitted this quarter, with Yalgoo belt had very, very fractured ownership in the past and
a maiden ore reserve to follow early in the new year. Gascoyne they’ve done a magnificent job in pulling that all together into one
is still finalising the amount of upfront capital required to have continuous ownership.
material from Melville put through the processing facilities at “Early on in our strategy days, Firefly wasn’t at the top of list but
Dalgaranga. once we saw the opportunities at Melville and the continuously
Hay indicated the company was likely to go down the mining contiguous ownership, it quickly moved up the list of attractive
contracting route for Melville, with existing Gascoyne contractor consolidation opportunities.”
NRW Holdings Ltd in the box seat for that task. In conjunction with the business combination, a suite of copper-
Firefly managing director Simon Lawson, who will join Gascoyne gold and lithium exploration assets in the Paterson, Murchison
as a non-executive director once the merger is complete, said and Forrestania regions will be demerged into a new company
Dalgaranga was the logical home for his company’s flagship named Firetail Resources Ltd to be listed on the ASX at a later
project. date.

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