Ortac Resources Limited Update on Andiamo Exploration Ltd (0708R)
December 06 2016 - 2:42AM
UK Regulatory
TIDMOTC
RNS Number : 0708R
Ortac Resources Limited
06 December 2016
06 December 2016
Ortac Resources Ltd
("Ortac" or the "Company")
Update on Andiamo Exploration Ltd
The Board of Ortac, the AIM quoted exploration and mine
development company, announces an update in respect of its
exploration partner in Eritrea, Andiamo Exploration Ltd
("Andiamo"), in which Ortac holds a 26.99% equity interest.
In July 2016, the Eritrean Government granted Andiamo an
extension of 91km2 to its Haykota licence, covering ground
containing known volcanogenic massive sulphide ("VMS") targets. The
area was previously part of a licence held by a now defunct
Libya-Eritrea joint venture company, which ceased exploration
following political change in Libya. Andiamo now plans a review of
existing data followed by exploration for VMS, copper-gold and
shear-hosted gold mineralisation, especially over known mineralised
zones in the Mio area.
The terms of the agreement between Environminerals East Africa
("EEA") and Andiamo have been satisfied, thereby awarding EEA a 50%
interest in discoveries made in the JV agreement area.
In August 2016, EEA offered to exchange its joint venture
interest in the JV license area for equity in Andiamo, EEA having
expended approximately US$2.3 million on exploration. Andiamo and
EEA agreed on 30 September 2016 to exchange the JV interest for a
25% interest in the share capital of Andiamo, but subject to
certain conditions being fulfilled. The transaction has not yet
completed and potentially may not complete, but under the original
terms might imply a value of approximately US$0.17 per Andiamo
share; this could potentially value Ortac's interest in Andiamo at
approximately US$1.8 million. If the transaction does complete, EEA
will nominate a director to Andiamo's board and EEA's principal
shareholder has expressed an interest in investing further in
Andiamo.
Vassilios Carellas, Ortac's CEO, commented: "The strategic
extension of Andiamo's exploration area to the south ensures that
Andiamo have secured an exciting trend along the western VMS belt
in Eritrea where economic discoveries have recently been made and
reported by Nevsun Resources Ltd. (TSX:NSU) (NYSE MKT:NSU) just to
the north of Andiamo's license area.
Further, it is encouraging to see EEA wanting to convert its JV
interest into shares in Andiamo as this supports our belief that
apart from the JV area, the rest of Andiamo's exploration area is
of material interest and could well deliver a discovery of
significance. Although this transaction, if completed, would be at
a 70% premium to the price paid by Ortac for its recent purchase of
Andiamo shares in September, it is assumed that any new money
raised by Andiamo may be at a level lower than this."
-ENDS-
For further information, please contact:
Ortac Resources Ltd
Vassilios Carellas (CEO) +44 (0) 20 7389 9050
SP Angel (Nominated Adviser & Broker)
Ewan Leggat/Lindsay Mair +44 (0) 20 3470 0470
Joint Brokers
Beaufort Securities
Jon Belliss / Elliot Hance +44 (0)20 7382 8300
Peterhouse Corporate Finance Limited +44 (0) 20 7469 0930
Guy Miller www.pcorpfin.com
Lucy Williams
For additional information please visit -
www.ortacresources.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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