ASX-listed explorer DevEx Resources has shifted its strategy towards focusing on its emerging REE and uranium projects by entering an agreement to sell its New South Wales copper-gold portfolio to Lachlan Star Limited (ASX: LSA) for a value equaling A$7.5 million.
The agreement will see DevEx sell 100 per cent ownership of its Junee, North Cobar and Basin Creek Projects to Lachlan Star for a consideration of $7.5 million dollars worth of shares in LSA as well as a 2 per cent net smelter royalty.
The portfolio comprises a total of 11 tenement areas and contains a number of exploration targets including the well-advanced Nangus Road which has indicated the potential to host a large porphyry copper-gold deposit.
Following completion of the agreement, DevEx will hold a considerable 36.46 per cent interest in Lachlan Star and will be given the opportunity to appoint two of its directors to LSA’s board, allowing it to retain a considerable hold on the 1,956 square kilometre portfolio.
This simplification of the explorer’s portfolio will allow the Company to place the majority of its resources, focus and time on its high-potential Nabarlek Uranium Project and the recent ionic clay-hosted REE discovery at the Kennedy Project.
Located in the Northern Territory, Nabarlek covers approximately 4,700 square kilometres of the Alligator Rivers Uranium Province, which is renowned for its world-class uranium deposits with over 500 million pounds of uranium (U3O8) identified in mined current resources.
The Project is named after the Nabarlek Uranium Mine, which sits at the centre of the Project and is widely considered the lucky country’s highest-grade uranium mine, posting a massive historical production of 24 Mlbs @ 1.84% U3O8
DevEx has recently kicked off an extensive drilling campaign around this historical mine, with the rig following up on a number of compelling previous intersections up to 6m @ 7.6% U3O8.
Kennedy meanwhile, put itself on the map in a big way when maiden drilling at the Queensland Project returned extensive zones of shallow REE mineralisation grading up to 1,895 ppm TREO, with later metallurgical test work confirming the project hosts ionic adsorption REE clays allowing for high recoveries at rapid rates.
What makes REE mineralisation at Kennedy particularly compelling are the considerable values of high-value magnetic rare earth oxides which comprise the total rare earth grade, with these particular rare earths seeing increased interest globally due to their criticality to the burgeoning electric vehicle and renewable energy markets.
With such compelling early results, it’s no wonder why DevEx wishes to maintain focus on developing these projects, with the Company stating that while NSW projects are compelling, it believes that placing its time and focus on Kennedy and Narbarlek will better serve the interests of shareholders.
“The NSW projects have delivered exciting early-stage results – however the reality is that these assets require sustained and focused exploration efforts to unlock their full potential,” DevEx’s Managing Director Brendan Bradley said.
“In light of the success we have been enjoying at our Nabarlek Uranium Project – where we have an exceptional opportunity to discover and delineate high-grade uranium resources at a very favourable time in the uranium cycle – and the immense potential of our Kennedy Ionic Clay-hosted REE Project, we believe it is in shareholders’ best interest to focus on these outstanding opportunities.”
DEV’s Australian Stock Exchange-listed share price is currently trading at 32.5c (10:45 am UTC+ 8 hours).