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Matsa Buys Red October in Western Australia

Goldfields miner Saracen Mineral Holdings has sold the Red October mine to Matsa Resources in a $1 million cash deal.

Matsa will pay $1 million in cash and 4.5 million shares at a deemed issue price of 22 cents each. The mine site includes a 68 person accommodation camp and the project covers around 64 square kilometres. It holds a mineral resource estimate of around 99,000 ounces of gold.

The deal is expected to be finalised in October and Matsa intends to restart mining operations at the site, undertaking drilling to increase the mine’s lifeline.

Red October, which has generated 342,000oz ounces since it began its life as an open-cut mine with Sons of Gwalia in 1999, was considered a sweetener at Carosue Dam after Saracen sank the underground decline in 2011, with historical production grading more than 6g/t.

Saracen will take a 3% stake in Matsa as part of the deal.

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