Far West forms alliance with BHP

Far West Mining (FWM-V) has entered into a strategic alliance with a wholly owned subsidiary of Australia’s BHP (BHP-N).

The alliance will use BHP’s proprietary airborne gravity gradiometer technology to explore for major mineral deposits of mutual interest.

In exchange for the right to use BHP’s technology, Far West will fund agreed surveys and drill-testing of selected targets in the designated project areas. Far West can earn a 70% interest in the project, subject to a BHP’s back-in right.

The back-in right allows BHP to acquire up to a 75% interest in any discovered mineral deposits by:

• solely funding ongoing exploration;
• making various cash payments to Far West; and
• carrying Far West through to completion of a bankable feasibility study.

Mineral exploration in Canada will be funded via the flow-through funding tax incentive program.