New pacts for Star Mountains

 Highlands Pacific and Anglo American have executed the joint venture and farm-in agreements for the Star Mountains copper-gold project in Western, Proactive Investors reported.

The Star Mountains exploration tenements cover 515 square kilometres and are located within the prospective New Guinean Orogenic Belt, which hosts the Grasberg, Ok Tedi, Porgera and Hidden Valley mines, as well as the Frieda River deposit.

Anglo American is a £16 billion (A$31.4 billion/K64.56bn) market cap with mining operations in southern Africa, north and south America and Australia.

Preparation for the upcoming exploration and drilling campaign will now ramp-up with a four hole, 3000m campaign to start in April.

A helicopter-magnetic survey has been completed and a survey would commence in the coming weeks.

The joint venture and farm-in agreements consist of the following:

• US$10 million payment: Anglo American will pay Highlands US$10 million (K26.28m) in two tranches 

of US$5 million (K13.14m) each. The first payment of US$5 million is payable on execution of the agreements with the second payment of US$5 million to be made 12 months later;

• phase 1 (51 per cent interest): Anglo can earn a 51 per cent interest in the joint venture by spending US$25 million (K65.7m) on exploration over four years, and declaring a 43-101/JORC compliant inferred resource of 3 million tonnes of contained copper-equivalent within five years; 
• phase 2 (80 per cent interest): Anglo American can move to an 80 per cent interest in the Joint Venture by completing and funding a Bankable Feasibility Study (BFS) within 15 years of the execution of the Farm in and Joint Venture Agreements; and,
• Development Free Carry: Anglo American will provide Highlands with up to US$150 million (K394.21m) in project development funding as a deferred free carry following completion of the BFS.

Highlands will continue to manage the project, however, Anglo American will have the right to take over management of the project when it has invested US$25 million (K65.7m) in project expenditure.

Highlands has identified 17 copper gold targets to date at Star Mountains and drilled six of these targets, of which all but one encountered mineralisation.