Legend Mining says it has received a request from Hong Kong’s Asia Iron Holdings subsidiary Extension Hill to purchase its Mt Gibson gold project in Western Australia. The sale is subject to approval in March and will see Legend secure $8.4 million in cash and bonds to put towards exploration on its 2900sqkm Cameroon iron ore project.

The company previously entered into a sale agreement in November 2011 with Top Iron for a $7 million purchase of the non-core Mt Gibson project. However, a condition of sale was that Legend had to exhaust all relevant rights of first refusal and third party rights under its existing licence agreement.

Extension Hill has now exercised its rights, trumping the Top Iron agreement. A 60 day due diligence period is now under way as well as a foreign investment board review. Extension Hill owns a number of iron ore and coal development projects in Western Australia’s mid west as well as a magnetite pellet plant project in Nanjing, China.

Legend’s 215sqkm Mt Gibson zinc-copper gold project is about 300km northeast of Perth, in Western Australia’s Murchison province. It is about 100km south of the world-class Golden Grove volcanic-hosted massive sulphide zinc-copper mine, which is also situated on the Yalgoo-Singleton greenstone belt.

Mt Gibson commenced production as an open pit gold mine in 1986. It produced 870,000 ounces of gold until production ceased in 1988. Legend acquired the mine in 2005 to pursue the zinc-copper-gold potential beneath the existing gold oxide pits. Drilling completed in 2008 intersected a prospective ‘zinc horizon’ including intervals of 3.77 metres @ 6.75% zinc from 310 metres and 30.29 metres @ 1.14% zinc from 285 metres.

www.legendmining.com.au

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