Reach Resources Limited has executed a binding Right to Mine Agreement for the Murchison South Gold Project in Western Australia after Andel Resources Pty Ltd completed due diligence and formally exercised its option.

Under the agreement, Andel will fully fund upfront pre-mining activities, mining, haulage, and processing costs, with repayment sourced entirely from gold revenue. The arrangement provides both companies with a 50/50 share of net project profits on an open-book, at-cost basis. Ore from the flagship asset, located near Payne's Find, is slated for processing at the nearby Kirkalocka Mill operated by Andel subsidiary Gylden Resources Pty Ltd under a forthcoming toll milling agreement.

Execution of the Right to Mine Agreement remains subject to conditions precedent, including Foreign Acquisitions and Takeovers Act approval, execution of necessary project and ancillary agreements, and completion of an independent environmental baseline audit. Reach Resources is working to submit its Mining Proposal in parallel with closing out those remaining conditions.

“This is a landmark milestone for the Company and our shareholders as we move from explorer toward developer. Following a rigorous due diligence review of our project, Andel have committed to us and development of Murchison South. We have some conditions left to close out which we will complete in parallel to submission of our Mining Proposal to commence mining as soon as possible. We look forward to working with Andel to bring Murchison South into production.” — Jeremy Bower, Chief Executive Officer

The project’s Blue Heaven deposit holds an updated Mineral Resource Estimate of 844 kt at 3.0 g/t for 80,000 ounces of gold, representing an increase over the previous estimate of 681 kt at 2.8 g/t for 61,300 ounces of gold.

“Having reviewed the geological database for Murchison South, conducted pit optimisations and preliminary mine designs, we are excited by both the near-term production potential from open pit operations and the longer-term upside to the project including underground mining. We look forward to working closely with Reach Resources to both expedite production and investigate future extension opportunities.” — Roderick Crowther, Chief Development Officer

The collaboration positions the companies to advance open-pit operations while investigating underground mining potential as part of the broader development pipeline for the Murchison Goldfields.

Read the full announcement: Andel Exercises Option & Completes DD - Fast-Tracking Mining