Catalyst Metals Ltd. agreed to evaluate a gold mine in southeastern Australia for up to 12 months with the option of acquiring a stake in the property, Catalyst said Thursday.
Catalyst and Unity Mining Ltd. signed a memorandum of understanding whereby Catalyst gets an option to acquire the Kangaroo Flat Gold Plant in Victoria, Australia. Kangaroo Flat is at the southern end of Victoria's prolific Bendigo gold field.
The deal, which obliges Catalyst to pay Unity $450,000 during the 12-month option period, gives Catalyst the option to acquire related equipment and facilities in the Bendigo area.
Kangaroo Flat was developed by Unity in 2006 for about $65 million (Australian).
If Catalyst decides to develop Kangaroo, Unity will get a 15 percent to 20 percent stake in Catalyst and a deferred royalty.
The deal is envisaged to provide an accelerated production route for any resources defined at Catalyst's Four Eagles Gold Project north of Bendigo, where high grade gold mineralization has been identified in shallow drilling conducted by Catalyst during
2011, Catalyst said in a statement.