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Geopacific to earn up to 75% stake in Kula's Woodlark Island gold project

GeopacificResources Ltd. has secured an option to earn up to a 75% interestin the WoodlarkIsland gold project in Papua New Guinea from by spending A$18.7million over 3.5 years, according to a July 11 statement.

Geopacific is aiming to increase the ore reserves at theproject to over 1.2 million ounces of gold, which stands at 766,000 ounces ofgold. The JORC-compliant resource estimate totals 2.1 million ounces.

The project is wholly owned by Kula's 100% subsidiary,Woodlark Mining Ltd.

The transaction will be followed by a contributing jointventure, and a 5% interest from Kula's remaining share will be assigned to thePapua New Guinea government.

Geopacific can also increase its share a further 5% to atotal of 80% by arranging Kula's share of the project development finance.