Gunsynd PLC (GUN ) has decided to relinquish its interests in the Bear Twit project in the Northwest Territories and the Hornby Bay uranium project portfolio in Nunavut, Canada.
The company is taking the necessary steps with Pinwheel Resources Ltd to terminate the relevant agreements and relinquish its interests in the projects.
Under the farm-in agreement announced by Gunsynd on 5 August 2024, Gunsynd committed to provide minimum funding of £100,000 per year for two years towards agreed work programmes at the Bear Twit and Hornby Bay projects.
To date Gunsynd has spent approximately £110,000 at project level.
Following a review of the expenditure required to maintain and advance the projects, the board has determined that committing further capital to them would not be in the best interests of shareholders.
In particular, maintaining the Bear Twit permits would require an extensive programme of physical claim staking.
Based on current estimates, this work alone could cost several hundred thousand pounds before any substantive exploration programme was undertaken.
The relinquishment of the Projects will remove the requirement for Gunsynd to fund further exploration expenditure under the relevant agreements and will allow it to concentrate its available capital and management resources on advancing Barb towards drilling.
The company will not receive any consideration from the relinquishment, nor will any money be owed to Pinwheel.
"This is a straightforward capital-allocation decision,” said Gunsynd’s chairman Hamish Harris.
“Bear Twit and the Hornby Bay assets may retain geological potential, but the expenditure required simply to maintain and advance them is substantial. That expenditure has to be considered against what we have now established at Barb, particularly the results of our recent surface sampling programme. The board believes that Barb also has considerable practical advantages over many Canadian exploration projects. It has all-year road access, is approximately two hours by road from Winnipeg and requires no helicopter support. The board expects this infrastructure to allow exploration programmes to be mobilised more quickly and at lower cost than at remote or seasonally accessible projects. We therefore do not believe it would be sensible to commit further funds to Bear Twit and Hornby Bay when that capital can instead be directed towards a road-accessible gold project that has shown repeated positive gold assay results from the surface sampling."
View from Vox
Success at Barb put the writing on the wall for Bear Twit and Hornby, although both projects had considerable merits. The new focus should enable Gunsynd to drive value more rapidly, as work on Barb proceeds apace.