The facility is 30km from Tombola's Mt Freda Gold Mine and 15km from Cloncurry and include fully permitted mining and exploration leases, the existing open cut gold and copper mine, a 250,000-300,000 tonne per annum Carbon in Leach gold / copper processing plant, and permitted tailings storage facility.

Lorena was commissioned in 2017 by a Joint Venture which included Malachite Resources and Chinova Resources but it was placed in care and maintenance in late 2021 pending a desire by the owners to sell the operation.

Tombola told the ASX the acquisition would enable them to undertake studies to optimise its gold production capacity by July 2023 and is structured to use cash reserves without incurring large additional capital construction costs that would otherwise be required to build a CIL plant and tailings facility of this size.

Tombola Gold Managing Director, Byron Miles said the acquisition of the Lorena Processing Facility delivers a step change in their targeted gold production.

"Importantly, it enables Tombola to commence planning to determine gold production rates as well as gold-optimisation planning studies," Mr Miles said.

"The Company aspires to significantly increase its production potential in terms of expected throughput and recovery rate, once both the original vat leaching and the Lorena facility are on stream in 2023. "

Mr Miles said they were fast tracking to near term gold production from Lorena in quarter four this year.

As part of the deal Tombola will pay $3 million in shares and $5m in cash with $1m up front and the balance over a six to nine month period.

Lorena had three JV partners: Malachite Resources subsidiary Volga Elderberry (55%), Cloncurry Gold Recovery (30%) and Ore Processing Services (15%).

In 2019 Lorena Gold part owners Malachite Resources announced a net loss of $6.5m amid low production numbers and an ongoing dispute with its joint venture partners.

The company wrote down Lorena, because gold production at the open cut was materially lower than forecast which has affected relations with the mine's other owners.

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