Evolution Mining has agreed to buy the Holleton gold project from Independence Group as part of a scrip and royalty deal.
Evolution, formerly Catalpa Resources, will issue 500,000 new shares to Independence and will issue a 2 per cent net smelter royalty return on any gold produced from the mine.
The Holleton project consists of 14 mining, exploration and prospecting licenses covering approximately 650sqkm near Southern Cross, about 70km south of Evolution's Edna May project.
Evolution said previous drilling by Independence had intersected high-grade mineralisation at Holleton.
Completion of the acquisition remains subject to satisfaction of certain conditions including a pre-emptive right held by a third party.
Evolution shares were off 2.5 cents, or 1.65 per cent, to $1.495 at 9.50am while Independence shares were off six cents, or 1.76 per cent, to $3.35.