Western Australian explorer Kingfisher Mining (ASX:KFM) announced a binding agreement to divest its entire interest in the Gascoyne Rare Earth Elements Project to Dreadnought Exploration, a wholly-owned subsidiary of Dreadnought Resources (ASX:DRE).
Under the terms of the transaction, Kingfisher will receive an upfront consideration of $2 million, payable in fully paid ordinary shares of Dreadnought Resources.
The deal includes up to $1.5 million in potential milestone payments, comprising performance-based cash payments linked to JORC resource definitions of up to 20 million tonnes at 1% total rare earth oxides.
The strategic divestment allows Kingfisher to reallocate vital funds and technical resources towards its high-priority projects in New South Wales.
The company aims to accelerate exploration on its copper-gold, silver, lead, and zinc assets during a period of strong metal prices.
A primary focus will be the Copper Blow Iron Oxide Copper Gold Project, located near Broken Hill, where previous drilling has confirmed high-grade mineralisation over a 600-metre strike length.
Kingfisher Managing Director Chris Bittar stated that the transaction is a "win-win," enabling the company to focus on driving discovery success in NSW while retaining exposure to the Gascoyne rare earth sector through its new shareholding in Dreadnought and future milestone payments.
At the time of reporting, Kingfisher Mining’s share price was $0.0080.