Strickland Metals Limited (ASX: STK) (Strickland or the Company) is pleased to announce that it has entered into a binding asset sale agreement (Agreement) with Northern Star Resources Limited (ASX:NST) (NST) pursuant to which the Company will sell its interests in the tenements comprising the Millrose Project (Transaction).
The Company's interests in the tenements which are being sold as part of the Transaction are set out in Annexure A (Millrose Project).
Management Comment
Andrew Bray, Chief Executive Officer, said: 'We are very pleased to deliver such a transformative sale for shareholders in a relatively short period of time. The Millrose Project was purchased for $10 million in mid-2021. After a highly successful 11 month drilling campaign throughout 2022 costing approximately $16 million, we are now selling the project for approximately $61 million, generating an approximate $35 million profit for the Company. We are also exceedingly pleased that we have been able to deliver such a strong outcome for shareholders given the ongoing difficult market conditions for junior exploration companies. This transaction leaves Strickland in the highly envious position of having one of the strongest balance sheets in the junior exploration space. We are confident of advancing and upgrading a number of additional gold prospects along strike to a standard similar to Millrose. Horse Well, Cowza and several other prospects will be the immediate focus of upcoming gold exploration programs. The Company will also be able to expedite some exploration programs around the highly encouraging Iroquois base metal discovery. I'd like to thank our shareholders for their ongoing support, as well as our technical team led by Richard Pugh and Peter Langworthy's team at Omni GeoX.'
Terms of the Transaction
The material terms of the Agreement are set out below.
The Company will receive the following consideration (Consideration) for its interest in the Millrose Project: A$2 million cash deposit paid on execution of the Agreement (Deposit); Cash consideration of A$39 million payable on completion of the Transaction which is expected to be no later than 30 business days and 1.5 million fully paid ordinary NST shares, to be issued on completion of the Transaction subject to 12 months
Escrow
In the event that the Transaction does not complete, the Deposit will convert into a loan which will be repayable by the Company to NST within 30 days from the date of termination of the Agreement.
Completion is subject to limited conditions, which are consistent for a Transaction of this nature.
As a result of the Transaction, NST will acquire the Company's interest in the Millrose Project, including a Mineral Resource comprising 6Mt @ 1.80g/t Au for 346,000 ounces and the Company will retain an Inferred Mineral Resource comprising 5.77 Mt @1.40g/t for 257,000 ounces.
Proceeds from the Transaction
Following completion of the Transaction, the Company will retain its Horsewell, Dusk til Dawn, Yandal East, Baxters and Iroquois Projects (Existing Projects) which are proximal to the Millrose Project and all located in the highly gold endowed Yandal Greenstone Belt in Western Australia. Strickland's focus will be to aggressively upgrade its portfolio of gold prospects to a standard similar to that of Millrose.
Within the first 12 months following the Transaction, the Company intends to use funds received under the
Demerger Update
On 21 October 2022 the Company announced its intention to pursue a demerger of the Iroquois Zinc-Lead Project located in the Earaheedy Basin in Western Australia (80% Strickland; 20% Gibb River Diamonds Ltd (ASX:GIB)) and its Bryah Basin Project located approximately 80 kilometres north of Meekatharra in the Gascoyne district of Western Australia (100% Strickland), subject to the Company obtaining the necessary shareholder, ASX and regulatory approvals (Demerger). The Company has decided that, in light of the sale of its interest in the Millrose Project and provided completion of the Transaction occurs, it will be putting the Demerger on hold for the time being. In the immediate short term, the Company will continue to advance both projects via exploration programs undertaken by the Strickland team. The Company will, however, assess all options relating to the projects in due course.
This announcement has been approved for release by the Chairman of the Company.
Contact:
Andrew Bray
Tel: +61 (8) 6317 9875
Email: info@stricklandmetals.com.au
The information in this report that relates to Exploration Results or Mineral Resources is based on information compiled or reviewed by Mr Richard Pugh who is the Strickland Metals Limited Geology Manager and is a current Member of the Australian Institute of Geoscientists (AIG). Mr Richard Pugh has sufficient experience, which is relevant to the style of mineralisation and types of deposit under consideration and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Pugh consents to the inclusion in the report of the matters based on the information in the form and context in which it appears
STRICKLAND METALS LIMITED 
