Mount Gibson Stakes $50M Claim on Central Tanami Gold Project
Mount Gibson Iron Limited has agreed to acquire Northern Star Resources' 50% stake in the Central Tanami Project, gaining access to 1.6 million ounces of gold resources and existing infrastructure in the Northern Territory.
- Acquisition of 50% interest in Central Tanami Project for $50 million
- Project hosts 1.6 million ounces of JORC 2012-compliant gold resources
- Includes non-operating 1.2 Mtpa processing plant and extensive infrastructure
- Completion subject to regulatory and joint venture approvals by March 2026
- Mount Gibson aims for development decision within 12-18 months
Strategic Acquisition in a Proven Gold Province
Mount Gibson Iron Limited has entered a binding agreement to acquire Northern Star Resources Limited's 50% interest in the Central Tanami Project Joint Venture (CTPJV) along with adjacent exploration tenements for $50 million. This transaction marks Mount Gibson's significant entry into the gold sector, leveraging a substantial resource base and existing infrastructure in the Northern Territory's Central Tanami region.
The CTPJV encompasses over 2,100 square kilometres of granted mining and exploration tenements, hosting JORC 2012 Mineral Resources totaling 13.8 million tonnes at 3.6 grams per tonne gold, equating to approximately 1.6 million ounces of contained gold. The resource base includes the high-grade Groundrush deposit, which has a history of producing over 600,000 ounces from open pit mining between 2001 and 2005.
Infrastructure and Development Potential
Included in the acquisition is a non-operating 1.2 million tonnes per annum carbon-in-leach processing plant, along with haul roads, an accommodation camp, a bore field, and a gravel airstrip. Although the plant has been idle since 2005, it represents a valuable refurbishment option that could accelerate project development.
Mount Gibson plans to fast-track permitting and technical studies, targeting a development decision within the next 12 to 18 months. The company intends to collaborate closely with Tanami Gold NL, the other joint venture partner, to advance feasibility-level studies on key deposits including Groundrush, Ripcord, and Jims.
Financial and Regulatory Considerations
The acquisition consideration translates to an attractive resource multiple of approximately $61 per ounce for the JORC 2012 Mineral Resources, and $38 per ounce when including historical estimates under the previous JORC 2004 code. Completion of the deal is subject to several conditions, including Foreign Investment Review Board approval, extension of infrastructure arrangements by the Central Land Council, and non-exercise of a right of first refusal by Tanami Gold, with a deadline set for 31 March 2026.
Mount Gibson will fund the purchase price from internal cash reserves and will assume existing bank guarantees. The company’s major shareholder, APAC Resources Limited, also holds a significant stake in Tanami Gold, underscoring the interconnected nature of the partnership.
A Calculated Step into Gold
Mount Gibson’s CEO, Peter Kerr, described the acquisition as a compelling opportunity to establish a precious metals production base, complementing the company’s existing iron ore operations. The Central Tanami Project offers a near-term development prospect with substantial exploration upside, supported by extensive historical data and recent resource updates.
While the historical mineral resource estimates require reclassification to current JORC standards, ongoing work aims to update these figures, potentially adding further value. The acquisition positions Mount Gibson to leverage its remote-site operational expertise and build a diversified metals portfolio in Australia.
Bottom Line?
Mount Gibson’s $50 million bet on Central Tanami could reshape its future, but regulatory hurdles and resource upgrades remain key watchpoints.
Questions in the middle?
- How will Mount Gibson manage the refurbishment and restart of the idle processing plant?
- What impact will the reclassification of historical resources to JORC 2012 have on the project’s valuation?
- How might joint venture dynamics with Tanami Gold influence project development timelines?
