TIDMTYM
RNS Number : 2781X
Tertiary Minerals PLC
19 December 2023
19 December 2023
Tertiary Minerals plc ("Tertiary" or "the Company")
EARN-IN AGREEMENT
KONKOLA WEST COPPER PROJECT, ZAMBIA
Further to its announcement of 25 September 2023, Tertiary
Minerals plc is pleased to announce that it's 96% owned subsidiary,
Tertiary Minerals (Zambia) Limited ("TMZ") has now signed a
definitive earn-in agreement ("the EIA") with a subsidiary of
KoBold Metals Company ("KoBold") and TMZ's local partner Mwashia
Resources Ltd ("Mwashia"). The EIA provides for KoBold to earn into
Exploration Licence 27067-HQ-LEL (the "Licence"), known as the
Konkola West Copper Project in Zambia.
KoBold Metals is a US-based, privately held, mineral exploration
company that couples geoscience, data science, machine learning,
and artificial intelligence to search for the critical minerals
needed for the clean energy transition and to accelerate growth in
electric vehicles. KoBold is backed by technology investors
including Breakthrough Energy Ventures (initiated by Bill Gates)
and Silicon Valley venture capital firm Andreessen Horowitz, as
well as institutional investors such as T. Rowe Price and Canadian
Pension Plan Investment Board.
"The signing of the EIA is an important development for the
Company and we are delighted to team up with KoBold Metals for this
exciting project. Konkola West is located in one of Zambia's major
copper mining areas where Vedanta has recently committed to invest
over $1 billion in revamping the adjacent Konkola copper mine.
KoBold will bring a strong technical team and financing to the
Konkola West project. It has been drilling with multiple rigs
throughout the summer on its adjacent Mingomba Copper Deposit and
is now committed to a deep drilling programme at Konkola West."
Patrick Cheetham, Executive Chairman Tertiary Minerals plc
"KoBold looks forward to working with Tertiary and Mwashia on
the Konkola West project. The Zambian Copperbelt has historically
seen little exploration at depth, and the Konkola West licence is a
great prospect to see if ore systems like those at Konkola or
Mingomba also occur at depth within this licence. We will be able
to use the equipment, experienced team, and data-science tools that
we've assembled while drilling the nearby Mingomba deposit to
improve our chance of success at Konkola West. We look forward to
starting drilling as soon as practical."
Mfikeyi Makayi, Chief Executive Officer, KoBold Metals
Zambia
Key Terms :
-- The objective of the EIA is to carry out deep drilling to
explore for projected extensions of the high-grade copper ore-shale
exploited on adjacent mining leases at the Konkola, Lubambe, and
Musoshi mines.
-- KoBold is currently delineating the Mingomba deposit, one of
the largest undeveloped copper deposits in the world. which lies on
the adjacent leases between the Konkola and Lubambe mines.
-- Subject to regulatory approval of the EIA, in Stage 1 of the
EIA, KoBold is committed to complete at least two drill holes (for
a total of at least 2,000m of drilling) within 14 months, with
drilling to start no later than May 2024 KoBold's planning of the
Stage 1 drill programme is well advanced with the first drill site
selected.
-- On completion of Stage 1, the parties will form a joint
venture company ("JVC") to hold the Licence and enter into a
shareholder agreement, the form of which is set out in the EIA. The
initial JVC ownership will be KoBold 51%, TMZ 39% and Mwashia 10%.
Mwashia's equity interest will be free carried by KoBold and can be
purchased by KoBold at any time for US$3.5 million.
-- KoBold may elect to increase its ownership in the JVC to 70%
in Stage 2 of the EIA through sole funding a cumulative expenditure
of US$6 million on exploration within 4 years of signing after
which TMZ will hold a 20% interest, and Mwashia will continue to
hold a 10% carried interest in the JVC.
-- After Stage 1 (or Stage 2 depending on KoBold's election at
the end of Stage 1) TMZ may elect to contribute to the further
costs of the JVC pro-rata with its shareholding or dilute its
interest in line with the customary joint venture dilution formula.
Should TMZ dilute down to 10% shareholding in the JVC then TMZ's
10% interest will convert to a 1% net smelter return royalty
payable for a 13-year period following the start of commercial
production.
-- KoBold and TMZ will each make an initial payment of US$30,000
to Mwashia (a payment due to Mwashia by TMZ under its existing
agreement with Mwashia).
-- TMZ's existing option agreement with Mwashia for the Konkola
West Project is terminated by the EIA. However, if the EIA
terminates for any reason, the EIA provides that the Licence may
then be held 90% by TMZ and 10% by Mwashia. Mwashia's interest at
this point would be free carried by TMZ, and TMZ would hold an
option to purchase that 10% interest for US$3.5 million.
-- The EIA is subject to certain conditions precedent relating
to the usual government approvals.
Further Information:
Tertiary Minerals plc:
Patrick Cheetham, Executive
Chairman +44 (0) 1625 838 679
----------------------
SP Angel Corporate Finance LLP
Nominated Adviser and Broker
Richard Morrison +44 (0) 203 470 0470
----------------------
Harry Davies-Ball
----------------------
Peterhouse Capital Limited
Joint Broker
Lucy Williams + 44 (0) 207 469 0930
----------------------
Duncan Vasey
----------------------
Market Abuse Regulation
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 as it forms part of
UK domestic law by virtue of the European Union (Withdrawal) Act
2018 ('MAR'). Upon the publication of this announcement via
Regulatory Information Service ('RIS'), this inside information is
now considered to be in the public domain.
Background Information
The Konkola West Project comprises Exploration Licence
27067-HQ-LEL which covers 71.9 sq. km. and is located 18km
northwest of Chingola in the Central African Copperbelt.
The Konkola West Project is targeting deep down-dip and
along-strike extensions of the contiguous Lubambe-Mingomba-Konkola
copper deposits to the east of the Licence and which extend north
into the Musoshi mining complex in the Democratic Republic of the
Congo. Together these deposits comprise a 15 kilometres long
continuous zone of mineralisation that contained a pre-mining
endowment of over 775 million tonnes grading 2-3% copper. Konkola
West is located approximately 2,000 metres southwest of the
Mingomba deposit, which lies between the Konkola and Lubambe mines,
and has historic resource estimates with around 9 million tonnes of
contained copper.
The Company's other interests in Zambia include the Jacks Copper
Project, where the Company completed soil sampling and drilling in
2022 and where further drilling is now warranted, and also the
Mukai and Mushima North project areas which are subject to a data
sharing and technical cooperation with First Quantum Minerals.
Recent soil sampling at Mukai and Mushima North has recently
defined a number of large copper-in-soil anomalies.
The Company also owns a portfolio of base metal and precious
metal projects in Nevada, USA and a fluorspar deposit in
Sweden.
For further information on KoBold and its activities in Zambia
see
https://koboldmetals.com/
and
https://www.youtube.com/watch?v=PVtERIM3QTM
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END
AGRQKLBFXLLZFBD
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