If a decision to mine is made, the 50:50 joint venture's objective is to undertake open-pit mining at Ophir and process the ore, with Glass Earth's share providing some cash flow for the exploration company.
The joint venture is another step by Glass Earth to move from being a gold explorer to producer and underpin its future with some cash flow.
Glass Earth has raised $24 million in several placements since 2005 and to the end of June this year had about $1.85 million cash on hand, enough to finance it through to July next year, Glass Earth chief executive Simon Henderson has said.
Ophir had numerous highly prospective mineralised reefs, as well as near-surface gold-bearing gravels, contributing to the excellent potential of the overall joint-venture area, Mr Henderson said.
The Ophir tenement covers about 640ha near Omakau, northeast of Alexandra, and had delivered 1200 ounces of gold by 1939.
Test drilling by Ophir Gold in 2006 estimated up to 109,000 ounces averaging 3.99g of gold per tonne of ore mined.
Mr Henderson said should a decision be made to go ahead, Glass Earth would be responsible for funding the design, permitting and installation of a processing plant, but Ophir would reimburse Glass Earth for its share of the plant acquisition from its after-tax profits.
Glass Earth has also undertaken to contribute "additional ground" around Ophir Gold's existing permit.
Mr Henderson said the predominance of coarse gold raised difficulties in adequately testing such mineralisation by drilling, and he preferred to tackle the appraisal for mining by bulk testing of ore around several of the vein systems.
"Irrespective of the smallish scale of the initial mining approach, it may provide positive cash flow for Glass Earth, especially as gold prices remain high," Mr Henderson said.
Privately owned Ophir Gold raised $700,000 in a private placement in mid-2006 and undertook a 17-hole drilling programme, increasing its estimated gold resource more than eight-fold.
Ophir Gold had earlier in the same year completed a similar programme costing $400,000.
The company had in 2007-08 considered raising $2 million in a private placement and also listing on the New Zealand stock Exchanges's alternative NZAX board, but that never went ahead.
In mid-2007, there was a board reshuffle, with founding directors Dr John Scott and Central Otago miner Bob Kilgour standing down from the board, but retaining their shareholdings, and being replaced by Ray Polson, of Dunedin accountancy firm Polson Higgs, and Alistair Ward, of investment bank Campbell McPherson in Auckland.
Since then, Ophir Gold's more than 7 million shares have been held by nine separate companies and 32 individual shareholders - about a third of whom are from Otago.
Ophir Gold Ltd is the 100% shareholder of Ophir Gold Exploration Ltd, whose directors are Mr Polson and Mr Ward.
In a similar cash-generating development, Glass Earth is continuing with a separate project in the Ida Valley, where it is concentrating on two of four gold prospects.
The company has a break-even target of 3000 ounces of alluvial gold and potential for a further 6000 ounces from hard-rock mining in the Ida Valley, but to date there have been no test results released giving a resource estimate.
Among Glass Earth's extensive activities around Otago was a $4 million, 18,000sq km airborne geophysical survey in 2007, under the largest permit ever issued in New Zealand, which was assisted by a $1 million contribution from the Otago Regional Council for collation of water-related data.
