Lexington Gold enters collaboration with Gold One Africa

14th Nov 2024 16:06

(Sharecast News) - Lexington Gold announced an agreement with Gold One Africa on Thursday, to explore potential cooperation on gold exploration and development projects in South Africa.

The AIM-traded firm said the 'intention to co-operate agreement' included Lexington's Black Economic Empowerment (BBBEE) partner, Letsema Holdings, and aimed to identify synergies between the companies' adjacent holdings in the Free State Province.

Gold One Africa, a subsidiary of Gold One Group, controls a mining right spanning 13,837 hectares in Ventersburg, Virginia, and Henneman.

Lexington Gold, through its 74% stake in White Rivers Exploration, holds prospecting rights on 19,633 hectares adjacent to Gold One's area.

The companies planned to investigate shared infrastructure, management resources, capital strategies, and potential economies of scale that could enhance the financial viability and operational efficiency of their respective projects.

If discussions advanced favourably, specific areas of cooperation would be formalised in definitive agreements, with a goal to develop a world-class gold deposit in the region.

"This agreement represents a potentially significant step forward in progressing our South African gold assets," said chairman Ed Nealon.

"Gold One Africa, with its proven track record and expertise in advancing projects from exploration to production, as exemplified by its success at the Modder East gold mine, is an ideal partner."

Nealon said the company believed the planned collaboration had the potential to unlock considerable value, leveraging the companies' combined strengths to create a "world-class gold resource" in the Ventersburg region.

"We look forward to continuing our discussions and exploring the opportunities for mutual benefit and will provide updates as appropriate in due course."

At 1333 GMT, shares in Lexington Gold were up 5.71% at 3.7p.

Reporting by Josh White for Sharecast.com.