Catalina Resources (ASX: CTN) to Acquire Badja Gold Project for $6m

Catalina Resources has agreed to acquire the Badja Gold Project in Western Australia’s Mid-West for $6 million upfront, adding a 90,358-ounce gold resource while materially expanding its issued capital.

The consideration comprises $3 million in cash and $3 million in Catalina shares issued at 5.5 cents each. A further $3 million will become payable if Catalina announces a JORC 2012 Mineral Resource of at least 160,000 ounces of gold from Badja at a cut-off grade of 1.0 g/t or lower, or the project produces 50,000 ounces.

Catalina will also assume existing obligations to pay EMU NL $1.2 million after the first 5,000 ounces of production and another $1 million after a further 5,000 ounces.

The acquisition remains conditional on shareholder approval for the consideration shares and any required third-party consents. The conditions must be satisfied or waived by January 31, 2027.

Established resource, high-grade history

Badja comprises the Gnows Nest, Monte Cristo, Flying Emu and Water Tank deposits. Its combined Indicated and Inferred Mineral Resource stands at 1.11 million tonnes grading 2.52 g/t gold for 90,358 ounces.

Most of that inventory is concentrated at Gnows Nest and Monte Cristo, which together host an Indicated Resource of 82,208 ounces. Gnows Nest accounts for 59,551 ounces at 4.32 g/t and historically produced approximately 27,925 ounces at an average recovered grade of 21.85 g/t.

Historical drilling at Gnows Nest includes 13 metres at 13.73 g/t from 39 metres, including two metres at 76.24 g/t. A separate hole returned three metres at 42.18 g/t from 77 metres. Mineralisation remains open along strike and at depth, including below the former underground workings.

Gnows Nest and Monte Cristo also carry a conceptual exploration target of 109,000 to 303,000 ounces at grades ranging from 4.4 to 5.7 g/t. The target is additional to the existing resource, but remains conceptual and is not a Mineral Resource or Ore Reserve.

Capital raising funds transaction and drilling

Catalina has secured commitments for a $3.39 million placement at 5.5 cents a share. Directors have committed another $120,000 on the same terms, subject to shareholder approval, taking the proposed raising to approximately $3.51 million. The issue price is a 9.1% premium to the 15-day volume-weighted average price through November 5.

The company expects to hold about $2.46 million in pro forma cash after acquisition and transaction costs, including a pending $830,000 bond release. Its share count is projected to increase from 246.2 million to 369.9 million following the placement, acquisition and advisory issues.

Catalina plans up to 15,000 metres of reverse-circulation, diamond and aircore drilling over six months. The first program will test extensions around Gnows Nest, with drilling scheduled to begin in January 2027. Monte Cristo, Flying Emu and Water Tank will also be tested, while historical tungsten mineralisation at Monte Cristo provides a secondary exploration opportunity.

Badja is within 100 kilometres of several gold processing plants, giving Catalina potential alternatives to standalone development. No third-party processing agreement has been secured, however, and any development pathway remains dependent on further drilling, metallurgy, mining studies, approvals and commercial terms.