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Gascoyne and Firefly execute demerger of exploration assets

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Global Mining Review,

Gascoyne Resources Ltd and Firefly Resources Ltd have entered into a binding Demerger Implementation Deed (DID), pursuant to which Gascoyne and Firefly have agreed the terms of a demerger of various assets, including the Paterson Copper-Gold Project, the Forrestania Gold Project2 and lithium mineral rights over various tenements held by both Gascoyne and Firefly which are to be acquired by a newly incorporated, wholly-owned subsidiary of Firefly, Firetail Resources Ltd.

Following the recent announcement of the merger between Gascoyne and Firefly, both companies believe the formation of Firetail creates a new exploration driven, energy metals focused business with a portfolio of copper-gold and lithium assets structured to unlock additional value for their respective shareholders.

The demerger will be conducted by way of an equal capital reduction in Firefly and an in-specie distribution of shares in Firetail to Firefly shareholders. Under the Demerger Firefly shareholders will receive one share in Firetail for approximately every 12.05 Firefly shares they hold at the record date. Upon completion of the Demerger, existing Firefly and Gascoyne shareholders will have an approximate 90.1% and 9.9% interest in Firetail, respectively.

Firetail will initially be a publicly unlisted company with an intention to seek an ASX listing at a later date following implementation of the merger. As part of the demerger, Firefly will make available up to US$1.5 million in cash to Firetail, which will comprise the payment of certain Firetail expenses (including reimbursement of transaction costs and immediate working capital requirements) with the remainder of such amount to be transferred to Firetail (subject to certain conditions).

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