Gold exploration and development company, Luiri Gold, has entered into a binding heads of agreement (HOA) with African-based mining contractor Bamboo Rock for the sale of a 75% majority stake in the its subsidiaries that hold the Luiri Hill gold projects in Zambia. Luiri will retain a contributing 25% equity stake and operational input in the projects via a shareholder agreement to be negotiated.

The Luiri Hill gold project currently consists of two large scale mining licenses, one of 32 square kilometres granted in 2003 and one of 245 square kilometres granted in 2012, covering a total area of 277 square kilometres. The tenements have a 25 year renewable term and combined with the recently issued Environmental Permit have all necessary rights to commence mining.

The licence within which both the projects lie was cancelled in July 2010. Upon its reinstatement in September 2011 a key condition of the renewal agreement with the Zambian government was that Luiri shall by 14 December 2013: “….be in a position to complete project implementation, secure the requisite statutory permits for its operations, have commenced construction of the mining operation and have secured the requisite financing to complete a fully operational large-scale mine in line with the development plan which shall be submitted to the Respondent [Ministry of Mines] within a reasonable period of time from the filing of this consent settlement order;….”

The company has previously advised that the only remaining outstanding requirement of the reinstatement consent settlement order was to secure the requisite financing to commence construction. Luiri considers the binding HOA to satisfy this requirement and has mobilised a grader and dozer to the Dunrobin site to commence development activities. The grader is upgrading the access road into the Dunrobin site area, making it fit for the delivery of major mining equipment during 2014.  The dozer has commenced the cleanup of the Dunrobin pit in preparation for mining activities in 2014.