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Magmatic Resources and Fortescue have executed a farm-in and joint venture (JV) agreement at the Myall copper-gold project in New South Wales.

The agreement will see Fortescue spend up to $14 million over six years to earn up to 75 per cent joint venture interest in the project.

Fortescue will also subscribe for 75,946,151 shares in Magmatic Resources to hold a 19.9 per cent stake.

The Myall project consists of a contiguous 244 kilometre square tenement covering the northern extension of the Junee-Narromine Volcanic Belt.

Magmatic Resources has found significant porphyry-associated copper-gold mineralisation in the area.

“We are excited to joint venture and partner with Fortescue to advance our exploration efforts across the Myall project area,” Magmatic Resources executive chairman David Richardson said.

“Myall has many of the signatures of a Tier 1 copper-gold deposit and Magmatic has recognised the need to partner with a major to further advance the project following the maiden resource.”

The terms of the agreement stipulate that Fortescue may earn a 51 per cent initial interest in the Myall project by incurring $6 million in expenditure on exploration in the initial earn-in period of up to four years.

Upon earning a 51 per cent interest, a JV will commence and Fortescue will sole fund and manage exploration activities.

“Fortescue’s cornerstone investment in Magmatic Resources will allow the company to simultaneously advance our other two projects at Wellington North and Parkes which are strategically located near Alkane Resources Boda-Kaiser deposits and Tomingley gold operations respectively,” Richardson said.