London quoted Stellar Diamonds has completed the Tribute Mining Agreement and Revenue Share Agreement with Octea Mining in respect of the Tongo-Tonguma kimberlite diamond project in eastern Sierra Leone.
Completion follows the satisfaction or waiver of the conditions precedent to the agreements, including, inter alia, satisfaction of the initial financing condition and all encumbrance over the Tonguma company or assets having been lifted.
Pursuant to an agreement dated 27 February 2018, both Stellar and Octea have agreed that outstanding title opinions over the Tongo and Tonguma licences will be provided following payment of licence fees for the existing Tonguma mining licence held by Tonguma Limited which Stellar is expected to fund shortly.
The Tongo mining licence has been approved by the Minerals Advisory Board and the licence fee is expected to be paid when the company has secured the project funding.
In this regard, Stellar Diamonds is continuing its discussions with Newfield Resources regarding a possible offer.
“The closure of the agreements with Octea mark a major milestone for Stellar as it secures the Tongo-Tonguma project for the planned long-term development programme. We have already commenced the front end engineering design programme and have signed a contract for 9 000 m of mine development drilling that will enhance the geological control for the first two levels of mining,” says Karl Smithson, chief executive of Stellar Diamonds.
“Discussions are ongoing with Newfield Resources regarding the indicative offer which, if successfully concluded, and supported by our respective shareholders, will result in sufficient funding being made available to bring the Tongo-Tonguma project into production according to the refined mine plan that will be generated by the FEED programme.”