Keras has acquired Arcadia Minerals, owner of the Klondyke gold project in the East Pilbara, for $A1.42 million and 100 million shares, as well as a 2.5% royalty.

Klondyke has a resource of 5.6 million tonnes at 2.08 grams per tonne gold for 374,000 ounces of gold, and is underexplored and open at depth.

Haoma Mining has also granted Keras a five-year right to mine its nearby Klondyke and Warrawoona tenements for $250,000, as well as an option to purchase the ground outright for $1.25 million.

Keras said the area over the Warrawoona greenstone belt had been stifled by multiple ownership and would benefit from consolidation.

The company believes there is the potential for a large-tonnage open pit operation, with a four—phase program of work to begin shortly.

The acquisition will be funded via a $US2 million finance facility arranged by Riverfort Global Capital.

Keras managing director Dave Reeves said the “transformational” acquisition would elevate the company to a standalone, owner-operated gold miner in addition to its current tribute miner model.

“We are committed to maximising value for shareholders and since entering the West Australian gold industry via tribute mining agreements in Q4 last year, we have been evaluating opportunities which will enable us to diversify our operational risk and increase the returns from our investment,” he said.

As part of the company’s growing Australian focus, it will seek a dual listing on the ASX at the start of 2017.

“Importantly, strong investor appetite for Australian gold stocks on the ASX positively impacts valuations and we believe this will benefit all shareholders, both in London and Australia, in the future,” Reeves said. 

As part of the planned listing, the company will restructure its board to become more Australian-focused.

Roy Pitchford has resigned, while chief financial officer James Carter has stepped down from the board but will continue with the company.

Brian Moritz will resign on the appointment of an Australian-based chairman.

Reeves is Australian, while former Medusa Mining managing director Peter Hepburn-Brown is on the board, with Kalgoorlie-born mining engineer Peter George as chief operating officer.

The company’s existing tribute mining operations at Wycheproof are continuing ahead of schedule with the first 10,000 tonne parcel of ore at 1.6gpt gold to be processed early next month.

The pit is expected to produce 900oz of gold at an all-in sustaining cost of $A1400 an ounce.

“We are entering a new and exciting phase for Keras and this strategy will be supported by our tribute operations which have been scrutinised by the board to ensure profitability going forward,” Reeves said. 

“I am pleased to say that the changes we have made are already bearing fruit at Wycheproof.

“The changes to our corporate identity and board reflect our genesis and we look forward to keeping shareholders abreast with updates in the near-term.”