Tanzania – A joint venture (JV) between ASX-listed niobium-hopeful Cradle Resources and African-focused mining platform Tremont Investments has exercised its option to acquire 100% of the Panda Hill niobium mining licences in Tanzania.
The JV, known as Panda Hill Tanzania and owned 50% by Cradle and 50% by Tremont, has entered into an amended purchase agreement with the vendor RECB.
Under the terms of the amended purchase agreement, the JV will pay RECB US$1.5 million as well as 6.2 million shares in Cradle, valued at $1.09 million, upon completion of the transaction.
Half of the shares will be tradeable and half escrowed until the commencement of commercial production.
A further $3 million is payable five days after project financing drawdown or 30 September 2016, whichever earlier, and $5 million, payable out of production as a capped 5% net smelter return, with a time limit of four years from the commencement of commercial production.
The agreement represents a saving of approximately $2.5 million from previous option arrangements, which the JV was able to negotiate due to the time benefit and certainty to RECB of the early option exercise.
The Panda Hill definitive feasibility study (DFS) is due to be completed by the first quarter of 2016.
Meanwhile, Cradle Resources simultaneously announced the resignation of Grant Davey as MD of the company.
Cradle Resources chairman Craig Burton will become executive chairman of Cradle Resources pending the appointment of a new MD.
Cradle Resources said in a statement that the resignation is entirely a decision of Davey, consequent upon his desire to engage in a wider range of business activities, with ownership and management of the Panda Hill project transitioning to the JV company Panda Hill Tanzania, and with the DFS nearly complete.
Davey will remain a consultant to the JV and will assist in completion of the DFS.