Millenium JV

On 17 September 2013, CYU entered into a further binding term sheet to create a joint venture with Elementos Limited (ELT) to explore for copper, cobalt and gold and ultimately earn a majority interest in the Millenium Project.

Millenium, also situated near Cloncurry, includes the following tenements:

  • Mining Leases totalling 134 hectares;
  • Exploration Permits totalling 254 km2;and
  • Exploration Permit applications (including areas that involve contested applications) totalling 74 km2.

Set out in the figure below is a diagram that shows the location of the Millenium tenures, as they relate to CYU’s other project interests in the region. As can be seen, the Millenium project is highly complementary to the Roseby South project area.

The terms of the earn-in joint venture between CYU and ELT are:

  • CYU will make a payment of a $100,000 cash option fee for the exclusive right to explore the properties subject to the joint venture;
  • CYU will have the right to earn 51% of the project by investing $1.2 million over 3 years; and
  • CYU may increase its interest by a further 19% of the project, by investing an additional $1.3 million over a further 2 years.

Once CYU earns its 70% interest, each party can either contribute or dilute according to an agreed formula and work program. If either party achieves a 90% interest in the project, the 10% interest immediately converts to a 1% net smelter royalty. The agreement is subject to finalisation of a full joint venture agreement and the transfer of the Millenium Mining Leases to ELT, which are currently the subject of an option to purchase agreement with Forte Energy NL.

The Millenium Mining Leases host a number of historical copper mine workings and prospects that were operated around the start of the 20th century. The Federal mine exploited copper in bornite and chalcopyrite down to 135 metres, producing some 10,000 tonnes of ore at exceptionally high grade (25% copper – non-JORC). As has been advised to the market, it is this region where CYU commenced its first exploration program, in early November 2013.