Minerals 260 has announced the acquisition of the Bullabulling gold project in Western Australia from Norton Gold Fields, part of China’s Zijin Mining, for A$166.5m ($103.6m).

The junior explorer will pay A$156.5m in cash and A$10m in shares as deal consideration.

The deal is expected to close in the second quarter of this year.

Its completion is contingent upon regulatory and shareholder approvals, an equity raise to finance the purchase, Australian Securities Exchange (ASX) re-compliance and other standard conditions.

Minerals 260 intends to finance the deal via an equity raise, which will be managed by Bell Potter Securities and Argonaut Securities as joint lead managers.

The Bullabulling project, with a 2.3 million-ounce mineral resource estimate, is situated in the Archaean Yilgarn Craton, around 65km south-west of Kalgoorlie and 25km west of Coolgardie in Western Australia.

This project encompasses a tenement package of 127km², consisting of 59 tenements.

It features four main deposits – Dicksons, Phoenix, Bacchus and Kraken, all of which can be mined using open-pit methods.

Previous metallurgical testing indicates recoveries of 87% across the project, alongside meaningful historical production in the 1990s, which yielded 3.9 million tonnes of ore, recovering 179,000oz of gold.

A solid foundation underpins the near-term production objective, with around 12,000 drill-holes totalling 530,000m across the project.

Minerals 260 plans to initiate an 80,000m reverse circulation and diamond drilling campaign immediately after the completion of the proposed transaction.

The company will collaborate with Norton Gold Fields during the interim period to lodge the necessary permits.