Perth, Australia — MININGREVIEW.COM — 18 February 2009 – ASX-listed Sub-Sahara Resources NL – a junior exploration company with an exploration focus on Eritrea and Tanzania in Africa – has signed a binding heads of agreement with another Australian company, Western Metals Limited, to acquire its interests in a number of gold exploration projects in Tanzania.
In a letter to the Australian Securities Exchange, Sub-Sahara Resources revealed that the purchase price had amounted to a total of A$6.25million (R40 million).
The letter explained that Western Metals had paid a deposit of A$100 000 (R650 000) on signing the agreement, and a further deposit of A$150 000 (R975 000) was payable on signing of the formal sale agreement.
In terms of the agreement, Western Metals would pay another A$750 000 (R4.9 million) on completion of the transaction, followed by a further A$250 000 (R1.625 million) on 31 December 2009, subject to finalisation of certain tax liabilities associated with the assets being sold.
A final A$5.0 million (R32.5 million) would be paid on the commencement of commercial production from the Nyanzaga gold project in Tanzania, which hosts the Tusker gold deposit of 4.5million oz grading at 1.15g/t gold.
The letter went on to explain that the funds received from this transaction would be used by Sub Sahara Resources to further advance the high grade Koka gold deposit in Eritrea that contains a previously announced indicated and inferred resource of 1.04Moz grading at 6.2g/t gold.
Sub-Sahara Resources would now focus its attention on developing resources in Eritrea.