Benz Mining (ASX: BNZ) has signed an agreement to acquire the Glenburgh and Mt Egerton gold projects in Western Australia from Spartan Resources (ASX: SPR).

The projects are considered highly prospective for gold and align with Benz’s strategy to generate value from underexplored gold assets in tier 1 jurisdictions.

They complement Benz’s existing Eastmain project, which has a resource of 5.1 million tonnes at 6.1 grams per tonne gold for 1.005 million ounces.

Capital raising

The total consideration payable to Spartan will be $15.6 million, including up to $6m in contingent payments, with completion of the transaction expected before year-end.

Benz’s acquisition will be funded by a placement to sophisticated investors, generating firm commitments to raise $4m, supported by Spartan.

The capital raising will involve the issuance of approximately 18.2 million fully paid CHESS Depositary Interests (CDIs), with each CDI representing one underlying Benz common share at $0.22 per new CDI.

Cornerstone investor

The sale of the non-core Glenburgh and Mt Egerton assets will allow Spartan to focus on its flagship Dalgaranga gold project in WA and move it towards a production re-start decision.

Upon completion of the acquisition by Benz, Spartan will become a strategic cornerstone investor with a 15% shareholding.

Spartan general manager Nick Jolly – instrumental in the transformational discovery of Dalgaranga – will also join Benz as a non-executive director.

Spartan’s technical advisory team will provide Benz with ongoing geological and exploration support across both projects.

Unlocking potential

Benz executive chairman Evan Cranston said the company was keen to work with Spartan to unlock the potential of Glenburgh and Mt Egerton.

“The acquisition of these projects will help solidify our position as a leading explorer in premier gold regions with assets that have substantial untapped potential,” he said.

“Glenburgh has high-grade zones that remain underexplored, so we will be applying advanced geological techniques to unlock its full value and at Mt Egerton we believe there is significant opportunity for rapid high-grade resource growth through targeted exploration.”

Mr Cranston hopes the projects will expand Benz’s growth opportunities in an environment where gold prices are reaching all-time highs.

Fertile location

The Glenburgh project comprises 786 square kilometres of land situated 250km east of Carnarvon, near the highly fertile zone between the Glenburgh Terrane and the Yilgarn Craton.

Benz’s immediate focus will be on high-priority targets at Icon, Apollo, Shelby, Hurricane, Zone 102 and Zone 126, with shoots exceeding 50 gram metres.

Glenburgh also contains a 5km-long, 100 parts per billion geochemical gold anomaly, indicating the continuation of the main mineralising structure along strike.

Benz’s geological modelling suggests that the prospective targets will likely extend through this area.

Mt Egerton exploration

Mt Egerton comprises two granted mining leases and five exploration licences over a total area of 180 sq km in the Gascoyne province, including the high-grade Hibernian mine and the Gaffney’s Find prospect.

It hosts an initial mineral resource estimate of 280,000t at 3.1g/t gold for 27,000oz and is within trucking distance to several operating mills, providing potential toll-treating options.

Previous drilling at the project returned high-grade intercepts including 5m at 96.7g/t gold, 4m at 91.9g/t gold, 4m at 75.3g/t gold and 11m at 42.5g/t gold, associated with quartz veining in shallow southwest-plunging shoots.

Hibernian potential

Mr Cranston said the Hibernian mine, which has been drill-tested to a depth of 70m, shows strong potential for expansion through deeper drill testing and targeting new shoot positions.

He added that there is also an 8km strike extension to the Hibernian trend under shallow cover, which remains underexplored.

As it finalises the transaction, Benz will be conducting a detailed geological analysis using advanced lithogeochemistry to identify high-conviction drill targets, setting the stage for a maiden drill program at the Glenburgh Project in Q1 2025.