Firms join up for gold project

KULA Gold Limited has announced that the company and Geopacific Resources Limited have entered into an earn-in and joint venture binding term sheet on Woodlark Island gold project in Milne Bay.
According to a market release, Geopacific has an option to fund A$18.65 million (K44 million) over three and half years to earn up to a 75 per cent corporate interest in the project company, Woodlark Mining Limited.
Geopacific is targeting an increase in the Project Ore Reserves to 1.2m oz gold.
Geopacific had provided Kula with a full funding option for Kula through to project production.
Geopacific has international resource funds as major shareholders – Resource Capital Funds and Tembo Capital who have been supportive of Geopacific.
Kula chairman David Frecker said: “This transaction delivers independent funding and regional expertise to significantly enhance the economics of the project for the benefit of Kula shareholders. Geopacific aims to undertake exploration drilling programmes to increase gold resources and reserves, and to provide the funding capability to move the Project through to production.”
According to Kula, this transaction provided a clear path to production with a substantial investment which would benefit the Government, Mineral Resources Authority, provincial government, local level government and Woodlark Island landowners.
“The expectation is that the project will develop into a valuable long life operating gold mine for the benefit of all shareholders and other stakeholders.”