South32 and AusQuest extend strategic alliance agreement

Handshake signifying an agreement.
Handshake signifying an agreement.

South32 (ASX:S32) and AusQuest (ASX:AQD) have extended the existing strategic alliance agreement (SAA) for a further two years to December 2025.

Originally established in February 2017, the SAA established an innovative framework under which AusQuest could use its extensive expertise to target new deposits and mineral provinces.

Over the past seven years, the companies have developed a strong working relationship and will continue working together to develop a pipeline of high-potential exploration opportunities in the country.

The SAA will remain focused on developing high-potential exploration opportunities in Australia targeting copper, lead, zinc and nickel. Other minerals such as lithium and rare earths may be considered.

Under the SAA, projects secured by AusQuest and offered exclusively to and accepted by South32 will undergo an evaluation process which sees projects classified as either exploration opportunities or drill-ready opportunities. If a project is rejected twice by South32 at any of these stages, it becomes a rejected property and will no longer be the subject of the SAA.

Once a project is accepted by South32 as a drill-ready opportunity, AusQuest must prepare a drill program and budget of at least $770,481 (US$500k). Following agreement of the program, a joint venture may be established.

AusQuest managing director Graeme Drew says the extension is a great outcome for the company.

“The extension of the SAA is a strong endorsement of AusQuest’s credentials and technical skills, and is a vindication of the quality and scale of the projects we have been able too consistently bring to the table over the past seven years,” he said.

“We continue to be excited about the future and look forward to continuing to work closely with South32 to build a quality pipeline of exploration opportunities which we hope will deliver significant benefits for both companies.”