Reach Resources (ASX:RR1) Andel exercises option for Murchison South Right to Mine Agreement
Reach Resources has announced that Andel Resources Pty Ltd has completed due diligence and formally exercised its option to enter into the Right to Mine Agreement for the Murchison South Gold Project in Western Australia.
The agreement relates to M59/769, Blue Heaven, with Andel’s right to mine subject to satisfaction or waiver of the remaining conditions precedent.
Highlights
Andel Resources Pty Ltd has exercised its option under the binding Option Agreement announced on 18 May 2026 and formally entered into the Right to Mine Agreement for the Murchison South Gold Project.
The Right to Mine Agreement provides for a 50/50 share of net project profits between Reach and Andel on an “at cost and open-book basis”.
Andel subsidiary Gylden Resources Pty Ltd operates the Kirkalocka Mill, located ~75km from Murchison South, and will process ore from Reach’s Murchison South Gold Project under a Toll Milling Agreement to be agreed as a condition precedent to the Right to Mine Agreement.
Subject to the remaining conditions precedent being satisfied, Andel will fund pre-mining activities, mining, haulage and processing costs upfront, with repayment from gold revenue.
The Right to Mine Agreement follows the Option Agreement announced by Reach on 18 May 2026, which granted Andel an exclusive option to enter into the agreement for the Murchison South Gold Project located in the Murchison Goldfields Region of Western Australia.
The executed agreement is legally binding, with Andel’s right to mine subject to satisfaction or waiver of the conditions precedent.
The remaining conditions precedent include Foreign Investment Review Board approval required under the Foreign Acquisitions and Takeovers Act 1975 (Cth), execution of project agreements including mining services and toll milling agreements, execution of ancillary agreements, and completion of an independent environmental baseline audit of the tenements.
The Blue Heaven Mineral Resource Estimate totals 844kt at 3.0g/t Au for 80,000oz of gold, comprising an Indicated Mineral Resource of 530kt at 2.6g/t Au for 45,000oz and an Inferred Mineral Resource of 314kt at 3.5g/t Au for 35,000oz.
The resource comprises 107kt of oxide material at 1.1g/t Au for 3,900oz and 737kt of primary material at 3.2g/t Au for 76,100oz.
The open pit Mineral Resource is the portion of the Mineral Resource constrained within a A$4,500/oz optimised pit shell and above a cut-off grade of 0.5g/t Au.
Reach CEO Jeremy Bower said,
“This is a landmark milestone for the Company and our shareholders as we move from explorer toward developer. Following a rigorous due diligence review of our project, Andel have committed to us and development of Murchison South. We have some conditions left to close out which we will complete in parallel to submission of our Mining Proposal to commence mining as soon as possible. We look forward to working with Andel to bring Murchison South into production.”
Andel Chief Development Officer Roderick Crowther said the company had reviewed the geological database for Murchison South, conducted pit optimisations and preliminary mine designs.
Reach and Andel will continue working towards satisfying the remaining conditions precedent for mining at Murchison South.