Dow Jones reported that metals explorer St George Mining Limited has signed a deal that would give BHP Billiton Limited rights to nickel on a property in Western Australia state in exchange for funding exploration work.

St George said that the agreement gives BHP a 2 year option over nickel rights at nine tenements covering about 498 square kilometers at the East Laverton property, 200 kilometers northeast of Kalgoorlie, provided it spends AUD 600,000 on exploration during this period. The option gives BHP the right to a 51% interest in nickel rights in the tenements, plus tenements covering a further 470 square kilometers, if it spends AUD 3 million over three years.

St George said that BHP can increase its interest to 70% by sole funding a bankable feasibility study.

Mr John Prineas chairman at St George said that "The farm in agreement is a giant leap forward in exploring what St George Mining believes is a major, new nickel sulphide district."

St George, which listed on the Australian bourse in November 2010, said it will retain the rights to gold and other metals found in the tenements.

(Source from www.dowjones.com)