In morning trade, the ASX gold stock is down a sizeable 6% to $9.08.

Why is this ASX gold stock falling?

Investors have been selling Capricorn Metals shares today after broad weakness in the gold sector offset news of a new acquisition.

In respect to the former, investors have been selling down the gold price amid optimism over potential deals between the United States and its trading partners.

This has reduced safe haven demand and sent the S&P/ASX All Ordinaries Gold index crashing over 5% lower today.

What about the acquisition?

This morning, the ASX gold stock revealed that it is making an addition to its portfolio.

It has entered into a binding agreement with BPM Minerals Ltd (ASX: BPM) to acquire the prospective Claw Gold Project tenement package.

According to the release, the Claw Gold Project covers approximately 398 square kilometres of tenure located contiguous to the south of Capricorn's Mt Gibson Gold Project (MGGP) in the Murchison region of Western Australia.

The ASX gold stock notes that the Claw Gold Project is considered highly prospective for gold mineralisation. It features multiple settings conducive to hosting economic gold deposits.

Capricorn has already identified seven target zones for exploration within the project tenure. It points out that the highest priority target is immediately adjacent to MGGP's Sundance prospect, which has been shown to host shallow supergene gold mineralisation.

What is it costing?

The company may have got itself a bit of a bargain if the Claw Gold Project delivers the goods.

The release reveals that it has agreed to pay $1.5 million for the project. This comprises $1 million in cash and $500,000 in shares.

In addition, there are potential additional payments totalling $1.5 million. These are contingent on a mineral resource being declared in excess of 75,000 ounces and the commencement of a commercial mining operation.

Commenting on the deal, the ASX gold stock's executive chairman, Mark Clark, said:

The acquisition of the Claw Gold Project continues the expansion of Capricorn's Mt Gibson exploration footprint and adds highly prospective targets very close to the Company's current Mt Gibson resources. This provides Capricorn with an outstanding exploration opportunity with a view to adding meaningful additional ore sources to the Mt Gibson operation. We look forward to commencing active exploration on the project in 2025.

The post This ASX gold stock is sinking 6% despite acquisition news appeared first on The Motley Fool Australia.

At the closing bell, BPM Minerals finished 7.40% higher to 29 cents apiece.

What did BPM Minerals announce?

In a statement to the ASX, BPM Minerals provided an update for its Western Australia projects.

The company advised that the Rhodes and Ivan Well lead-zinc-silver projects in Earaheedy Basin have now been granted. The site is an emerging base-metal precinct that has been largely untested for deposits.

BPM Minerals stated that external aeromagnetic-photographic interpretations have been completed at both projects. As such, the results show 21 and 13 Litho-Structural lead (Pb), zinc (Zn) and silver (Ag) exploration targets respectively.

Soil and stream sediment geochemical programs have been scheduled for Rhodes and Ivan Well to be completed in November. This is expected to assist with drill targeting and mapping of anomalous structures that may lead to mineralisation.

In addition, the Hawkins Project is slated for a grant in mid-November, with Native Title agreements now well advanced. The Hawkins area is considered to cover a significant strike length of the prospective Frere-Yelma Formation unconformity.

The company noted that ground gravity programs are planned to begin at Hawkins in mid-November. The geological survey is designed to identify areas of accumulations of massive sulphides.

Utilising a combination of airborne magnetics, gravity and passive seismic tools is expected to lead to Pb-Zn-Ag mineralisation. Should this occur, the BPM Minerals share price could potentially shoot higher in future. Investors have already expressed their positive assessment, sending the company's shares higher today.

BPM Minerals share price summary

Since listing on the ASX in December 2020, it has been a relatively positive year for BPM Minerals, up 20%. The company's share price accelerated to an all-time high of 59.5 cents in May, before sharply pulling back. 

On valuation grounds, BPM Minerals commands a market capitalisation of roughly $10.8 million, with approximately 37.5 million shares on issue.

The post BPM Minerals (ASX:BPM) share price leaps 7% on exploration update appeared first on The Motley Fool Australia.

BPM announced this morning it has entered into a binding heads of agreement to purchase all shares in Recharge Resources Pty Ltd, which holds 3 projects on the boundary of the Earaheedy Basin.

Market watchers might remember the announcement of a major lead and zinc discovery at the Earaheedy Basin by Rumble Resources Ltd (ASX: RTR) last month.

The BPM acquisition will be supported by a proposed $1.5 million private placement.

Let's take a closer look at today's news from mineral explorer.

Acquisition and placement

From its acquisition of Recharge Resources, BPM will gain the Hawkins, Ivan Well, and Rhodes projects.

Mining licenses for Hawkins and Rhodes are yet to be granted by the Western Australian Government.

The Hawkins project is just 40 kilometres from Rumble Resources' Chinook Discovery.

According to BPM, Recharge's Earaheedy Basin projects, together, cover 280 square kilometres of the same stratigraphic target zone as the Chinook Discovery.

Previous to the recent discovery of lead and zinc at Chinook, the Earaheedy Basin was known for its potential for iron ore and base metals.

Most previous drilling and soil sampling done at the Hawkins Project's Pinnacles prospect hasn't been assayed for iron or zinc. Meanwhile, drilling and soil sampling previously done at Ivan Well and Rhodes hasn't been assayed for base metals. Though, surface sampling at Rhodes has found areas of high-grade iron.

Recharge also holds a single project in southern Western Australia.

BPM states it's fully funded to complete 15,000 metres of drilling across the 3 Earaheedy Basin projects and 2 of its existing projects – an estimated cost of $5.2 million. It plans to conduct the drilling during the second half of 2021.

It's also planning a $1.5 million private placement to support the acquisition and its future ventures. The placement will involve 7.5 million shares sold at 20 cents apiece, each with one free option with an exercise price of 25 cents. The options must be exercised by September 2025.

Cost of the acquisition

For the acquisition of Recharge Resources, BPM will provide its current holder, Borg Geoscience Pty Ltd, with 1.875 million shares in BMP at a deemed issue price of 20 cents apiece. It will also provide the same number of options with an exercise price of 25 cents, expiring in September 2025.

Borg Geoscience will also receive 2 million performance shares in BPM, subject to various vesting conditions, and 1% of the net smelter return on all products of Recharge's tenements.

There will also be deferred payments given to Borg Geoscience 6 months after settlement or when Hawkins and Rhodes are granted exploration licenses, whichever is later. Upon those milestones, BPM will issue Borg Geoscience with the same amount of shares and options, with the same conditions, as before.

BPM Minerals share price snapshot

BPM executed its initial public offering (IPO) on 30 December 2020 and, before today, the company had not had a great start on the ASX.

Its shares were down 16% year to date when they entered a trading halt before the market opened on Monday.

Now, thanks to today's rally, the BPM share price has gained around 108% since the start of the year. 

The company has a market capitalisation of around $12 million, with approximately 24 million shares outstanding.

The post The BPM Minerals (ASX:BPM) share price is up 145% today. Here's why appeared first on The Motley Fool Australia.