Joint venture with Sandfire Resources

In March 2019, White Rock and Sandfire Resources Ltd (ASX:SFR) (Sandfire) joined forces to fund the exploration and development for Red Mountain.

Sandfire's Joint Venture funding obligations are structured across four stages and include an option to spend a minimum of A$20M over four years to earn 51% of the project, with a minimum contribution of A$6M in 2019. The key terms of the Joint Venture are set out below.

White Rock has signed an Earn-In and Joint Venture Option Agreement to permit Sandfire to farm-in to its interests in the Red Mountain Project including high grade zinc-rich VMS mineralisation at the Dry Creek and West Tundra Flats deposits and the newly discovered Hunter prospect.

Sandfire can earn up to 51% of White Rock’s interest in its Red Mountain Zinc-Silver-Lead-Gold-Copper Project by spending A$20M on exploration over four years (Stage One).

As a part of Stage One, a minimum of A$6M is required to be spent on the project in Year One (2019).

Sandfire can then elect to increase its interest in the Red Mountain Project to 70% by sole-funding a further A$10M and by delivering a pre-feasibility study with an Ore Reserve within a further two years.

White Rock can then elect to contribute its percentage share of expenditure to retain its 30% interest.

The Red Mountain Project includes a 475km² tenement package covering numerous historic VMS prospects with little modern exploration, providing Sandfire and White Rock with a large strategic footprint over a potential new VMS district.

On 25 March 2019, White Rock and Sandfire announced they had signed to collaborate on an Earn-In and Joint Venture Option Agreement over the 475km² Red Mountain Project.

STAGE ONE - EXPLORATION

  • Sandfire can earn 51% equity by spending A$20 million over four years

  • Minimum commitment of A$6m in Year One (2019)

STAGE TWO - PFS

  • Sandfire can increase to 70% equity by spending further A$10 million over two years and delivering a Pre-Feasibility Study and an Ore Reserve

STAGE THREE - DFS

  • Sandfire to complete a Definitive Feasibility Study

  • White Rock can choose to contribute its percentage share of expenditure to retain its interest

  • Alternatively, if Sandfire sole funds DFS, its interest increases to 80%

STAGE FOUR - DEVELOPMENT

  • White Rock can choose to contribute its percentage share of expenditure to retain its interest

  • Alternatively, if Sandfire sole funds DFS, its interest increases to 90% and White Rock must repay 10% of total capital out of cashflow

  • White Rock is leveraged to success through significant expenditure commitments required of Sandfire.