Abm Resources Nl (asx:abu) Secures Coyote Plant for Treatment of Old Pirate Ore

ABM Resources NL (ASX:ABU) ("ABM" or "the Company") is pleased to announce that it has reached agreement with Tanami Exploration NL ("Tanami"), (a wholly owned subsidiary of Tanami Gold NL) to lease the Coyote Gold Plant ("Coyote") and associated infrastructure for processing of ores from the Old Pirate High-Grade Gold Deposit in the Northern Territory, a haulage distance of 77 kilometres. The agreement, which is subject to several conditions precedent, includes an option to purchase Coyote, infrastructure and the underlying mineral leases. The agreement also includes pre-emptive rights on Tanami's surrounding exploration licences.

The lease infrastructure includes:

- 240,000 tonnes per annum (tpa) capacity gravity and CIL (carbon-in-leach) gold plant at Coyote.

- All other related surface infrastructure including airstrip, mobile equipment, tailings storage, workshops, offices, and camp.

The terms of the lease agreement include:

- $2M lease payment for the first 12 months of production.

- Option to extend the lease for a further 12 months for a payment of $2M.

- Option to purchase the Coyote Mine, infrastructure and the underlying mining leases for $3M.

- A pre-emptive right on all surrounding exploration licences held by Tanami in Western Australia.

The rationale of this agreement versus expanding ABM's own trial processing plant:

- Fast-tracks ABM's next stage open pit development at the Old Pirate High-Grade Gold Deposit.

- Reduces and stages capital expenditure requirements.

- Reduces construction and commissioning risk.

- Provides scalability (Coyote capacity is already at 240,000tpa and can be expanded).

- Higher projected metallurgical recoveries, with test-work indicating metallurgical recoveries up to 99% (versus 86% achieved using gravity gold methods during trial mining and processing).

- Reduces environmental footprint (not requiring either a new tailings storage facility or significantly expanded infrastructure / camp at Old Pirate).

- Increases upside and optionality with pre-emptive rights on surrounding exploration tenements.

About the Coyote Gold Plant

Coyote is located in Western Australia, approximately 45 kilometres (direct), or 77 kilometres using existing roads / tracks, from the Old Pirate High-Grade Gold Deposit in the Northern Territory. Coyote was put on care and maintenance in May 2013. A review of the Coyote processing plant by an independent engineering firm indicates the plant is in good working order and can...