Dynamic Metals Divests Lady Jane Gold Project to First Au for $650K
Key Takeaways
- Dynamic Metals has signed a binding sale agreement with First Au Limited for the Lady Jane Gold Project, valued at A$650,000 across three tranches: A$50,000 on execution, A$100,000 at Completion, and A$500,000 deferred to the first anniversary of Completion.
- Dynamic retains a 1.5% gross revenue royalty over all minerals extracted and sold from Lady Jane — calculated before any cost deductions — preserving long-term upside without further exploration spend.
- First Au is contractually bound to incur at least A$250,000 in direct drilling expenditure within 24 months of Completion, or Dynamic may re-acquire the project for just A$100,000.
- The deferred A$500,000 payment can be taken as First Au shares at Dynamic's election, calculated on a 20-day VWAP, subject to shareholder approval and defaulting to cash if approval is not obtained.
- The divestment frees Dynamic to concentrate capital on its flagship ~800km² Widgiemooltha Project, consistent with its stated strategy of directing resources toward highest-conviction opportunities.
Dynamic Metals moves to divest Lady Jane Gold Project
Dynamic Metals Limited (ASX: DYM) has entered into a binding Tenement Sale and Purchase Agreement with First Au Limited (ASX: FAU) for the sale of its 100%-owned Lady Jane Gold Project, located in the Ora Banda district of Western Australia. Announced on 2 October 2026, the deal values Lady Jane at $650,000 in cash and deferred consideration, with Dynamic retaining a 1.5% gross revenue royalty (GRR) over all minerals extracted and sold from the Project. The transaction is framed as a deliberate portfolio rationalisation, with Lady Jane classified as a non-core asset.
When big ASX news breaks, our subscribers know first
Transaction terms at a glance
The consideration is structured across three payments, with a deferred component giving Dynamic flexibility on form. First Au has also accepted a binding exploration commitment that protects ongoing activity at Lady Jane without further cost to Dynamic shareholders.
The payment breakdown is as follows:
- A$50,000 cash payable within five Business Days of execution
- A$100,000 cash payable at Completion
- A$500,000 deferred consideration payable on the first anniversary of Completion, at Dynamic’s sole election as either cash or First Au shares (calculated using the 20-day VWAP up to but excluding the Completion anniversary date; share issue is subject to shareholder approval and defaults to cash if approval is not obtained)
On the re-acquisition right: if First Au fails to incur at least A$250,000 of Direct Drilling Expenditure on the Project within 24 months of Completion, Dynamic may elect to re-acquire the Project and associated mining information for A$100,000. Qualifying expenditure is focused on drilling and directly associated activities, expressly excluding geophysics, surface geochemistry, desktop studies, and corporate or administrative overheads.
This Minimum Drilling Commitment is a structural benefit for DYM shareholders. It ensures Lady Jane continues to be actively explored, at no cost to Dynamic, for at least the first two years post-Completion.
| Component | Amount | Timing | Form | Notes |
|---|---|---|---|---|
| Upfront cash | A$50,000 | Within 5 Business Days of execution | Cash | Immediate on signing |
| Completion cash | A$100,000 | At Completion | Cash | Subject to conditions precedent |
| Deferred consideration | A$500,000 | First anniversary of Completion | Cash or First Au shares (Dynamic’s election) | Shares calculated on 20-day VWAP; subject to shareholder approval; defaults to cash if approval not obtained |
| GRR royalty | 1.5% | Ongoing (upon production) | Gross revenue | Applies to all minerals extracted and sold from the Project |
| Drilling commitment | A$250,000 minimum | Within 24 months of Completion | Direct Drilling Expenditure | Failure triggers Dynamic’s right to re-acquire for A$100,000 |
What is a gross revenue royalty — and why does it matter?
A gross revenue royalty (GRR) entitles the holder to a fixed percentage of the total revenue generated from minerals sold at a project, calculated before any deductions for operating costs, processing expenses, or transport. That distinction matters. Many royalty structures, such as a net smelter return (NSR) or net profit royalty, are calculated after some or all costs are deducted, which can significantly reduce what the royalty holder actually receives if a project’s cost base is high. A GRR sidesteps that risk entirely — the royalty applies to the top line, not what’s left over after costs.
For Dynamic shareholders, this is the key long-term lever in the transaction. Dynamic retains a 1.5% GRR over all minerals extracted and sold from Lady Jane. If First Au’s committed drilling programme advances the project toward production, Dynamic participates in that upside automatically, without contributing another dollar to exploration or development. The royalty applies across all minerals, not just gold, giving it broad coverage should the project’s geological profile evolve.
In short: Dynamic exits the funding obligation while keeping a seat at the table if Lady Jane ever becomes a producing asset.
The next major ASX story will hit our subscribers first
Strategic fit — why Dynamic is sharpening its focus
The divestment of Lady Jane is consistent with Dynamic’s stated strategy of actively managing its exploration portfolio and concentrating capital on its highest-conviction opportunities. Lady Jane’s classification as a non-core asset signals that it falls outside that priority set.
Dynamic’s flagship Widgiemooltha Project covers approximately ~800km² in the region between Norseman and Kambalda in Western Australia, considered prospective for both gold and nickel. Beyond Widgiemooltha, Dynamic holds a broader portfolio of exploration tenure including several joint venture positions where third parties are funding exploration to earn an interest. The Lady Jane divestment is structurally consistent with that capital-efficient model: Dynamic monetises a non-core holding, retains royalty exposure, and avoids the ongoing cost of maintaining and exploring a project that sits outside its core focus.
Managing Director Karen Wellman framed the rationale directly:
Karen Wellman, Managing Director
“The sale of Lady Jane provides an opportunity for Dynamic to realise value from a non-core part of our portfolio while retaining exposure to future success through the royalty. Importantly, First Au has committed to drilling the Project, allowing Lady Jane to continue to be actively explored without further funding from Dynamic. The transaction further demonstrates our strategy of actively managing the portfolio and directing our capital towards the opportunities where we believe it can have the greatest impact.”
Dynamic’s current capital position provides context for the transaction’s scale relative to the company:
- Share price: $0.60/share (as at 1 October 2026)
- Cash (30 June 2026): $1.92M
- Shares on issue: 52.5M
- Market cap: $31.5M
Completion of the transaction remains subject to conditions precedent, including the parties obtaining necessary approvals and consents and entering into required documentation in relation to existing third-party agreements. These conditions must be satisfied or waived by 5:00pm Perth time on the date falling 90 days after execution.
Don’t Miss the Next ASX Gold Sector Move
Get FREE breaking ASX gold and mining news delivered to your inbox within minutes of release, complete with in-depth analysis already done for you. Join 30,000+ subscribers who stay ahead of the market the moment news breaks. Click the “Free Alerts” button at Discovery Alert to start receiving alerts today.