The binding agreement will see the two companies establish JVs at Frontier's Bulago and Leonard Schultz tenements in the PNG Highlands and at the Likuruanga tenement and two EL applications on New Britain Island.

Ok Tedi will have the right to earn a 58% stake in the Highlands tenements by spending $12 million on each license within six years, and an 80.1% share of the New Britain tenements by spending $12 million on each of the three licenses over six years.

Once Ok Tedi spends the money, Frontier can elect to defer payment of its share in each JV up to the date of a bankable feasibility study to be repaid from half of its share of future mine revenue.

Either party can choose to dilute its interest and Ok Tedi will not retain an interest in any of the licenses if it withdraws before spending the required amount.

In the case of the Bulago and Leonard Schultz tenements, Ok Tedi will have an automatic option to acquire an additional 14% interest on completion of a BFS.

Ok Tedi will also reimburse Frontier for $235,000 of exploration at Leonard Schultz completed so far this year.

The company has committed to a minimum expenditure of $1 million at the Highlands tenements and $500,000 at the New Britain Island tenements this year, and will kick off exploration with detailed, high-resolution helicopter aeromagnetic and radiometric surveys over each license.

As part of the deal, Ok Tedi will subscribe for just over 15 million shares at A7.5c per share for a total investment of around $1.14 million, representing around 8% of Frontier shares.

Frontier also owns the Andewa project in PNG and the Narrawa polymetallic deposit and Stormont gold deposit in Tasmania.

Shares in Frontier gained 0.2c to 7.2c this morning.