Magmatic Resources (ASX:MAG) and a unit of Fortescue (ASX:FMG), FMG Resources, agreed to a AU$3.5 million exploration budget for the 2025 to 2026 financial year on the Myall copper-gold project in New South Wales, according to a Friday Australian bourse filing.

The work program was organized as per a farm-in and joint venture agreement between the firms, and it will be focused on an air core and diamond drilling program.

Fortescue will satisfy its minimum obligation under the agreement, subject to expenditure of the budgeted amount and the drilling program. The minimum obligation includes expenditure of AU$3 million and 3000 meters of drilling within the first two years of the agreement. It can earn up to a 51% initial interest in the project via a further AU$3 million in expenditure on exploration in the first four-year period of the agreement.

The shares of Magmatic jumped 9% in recent trading on Friday.