Base metal explorer Castillo Copper has announced the conditional sale of the Cangai Copper Mine tenements in New South Wales (NSW), Australia, to Infinity Mining.

The agreement includes three exploration licences, EL 8625, EL 8635 and EL 8601, in northern NSW, which host Cangai Copper Mine.

Under the deal terms, Infinity Mining will acquire the Cangai Copper Mine tenements subject to terms such as executing a formal sale agreement, raising a minimum of $1m (A$1.46m) in capital, and obtaining necessary shareholder and regulatory consents.

The deal also involves the transfer of royalty interests and the issue of shares and options to both Infinity Mining and an intermediary, Marshall Custodians.

Upon completion of the sale, Castillo Copper will receive 40,000,000 fully paid ordinary shares and 20,000,000 options in Infinity Mining.

The transaction is part of Castillo's strategy to optimise its non-core asset portfolio and concentrate on primary projects such as the NWQ Copper Project.

Castillo intends to retain its remaining non-core assets including the BHA East Project and the Mkushi Copper Project until suitable development partners are found.

Castillo Copper chairman Ged Hall said: “The strategic sale of the Cangai Copper Mine tenement package to Infinity Mining is an excellent outcome, as it is the second such transaction which unlocks value this calendar year.

“Moreover, it validates the board's strategy on optimising the non-core asset portfolio and enables resources to be channelled into developing the core NWQ Copper Project in the Mr Isa copper-belt.

“The board is highly confident Infinity Mining's team has the capability to fully develop the Cangai Copper Mine tenements, which in turn has the potential to generate material value for stakeholders given the equity position Castillo will hold post-transaction close.”

The deal is subject to several terms including shareholder and regulatory approvals.