Mundoro Capital, a copper-gold project generator company, has signed a binding memorandum of understanding (MOU) with Vale Canada for two of its exploration licenses in Serbia.

The two licenses – Savinac and Bacevica are located in the southern part of Timok, a metallogenic domain in the Tethyan Belt.

Timok is where the Cukaru-Peki deposit was recently discovered. Besides, it is home to the producing Bor copper porphyry underground mine and the Majdanpek and Veliki Krivelj copper-gold porphyry open-pit mine (Bor Mine Complex).

The Savinac license is situated 15km southwest of the Bor Mine Complex. It is said to have a considerable elongated north-south area of hydrothermal alteration spanning 14km2 which hosts epithermal and porphyry targets marked by Cu-Mo-Au-Ag-Pb-Zn geochemical anomalies.

Located directly south of the Savinac license is Bacevica, which contains 8km of hydrothermal alteration that is linked directly to the Savinac hydrothermal alteration to the north. The Bacevica project has four identified targets.

Mundoro Capital CEO Teo Dechev said: “Mundoro is pleased to expand its relationship with Vale by signing this binding MOU for the option of two of Mundoro’s projects in Timok, Serbia.

“This broadening relationship reflects (i) the quality projects Mundoro’s exploration team has generated and advanced; (ii) the Company’s commitment to bring value to the local mineral industry and communities where we operate and (iii) the added value to Mundoro shareholders through generating prospective royalties and near term revenue from our portfolio of projects.”

Terms of the MOU between Mundoro Capital and Vale Canada

As per the terms of the MOU, Vale Canada can earn 100% of the Savinac and Bacevica licenses by investing $2m in exploration over two years. If the Brazilian miner Vale’s subsidiary extends the option period for one more year, then it will pay $1m for such extension year.

During the option period, Mundoro Capital will be the operator of the two and will be paid an operator fee.

Following the exercise of the option, the copper-gold project generator company, will retain a NSR royalty of 2% on the licenses. Vale will have an option to buy up to 1% of this NSR royalty with payments linked to the gold price at that time.