The acquisition will increase its stake to 75% in the lithium and tin project that is located in the Democratic Republic of Congo
Australian mineral exploration company AVZ Minerals has secured rights to increase its equity stake in the Manono lithium and tin project to 75% for $15.5m.
The company has signed a share sale purchase agreement with Dathomir Mining Resources SARLU to acquire further 10% stake in its joint venture partner Dathcom Mining, which completely owns the Manono project.
Located 500km north of Lubumbashi in the Democratic Republic of Congo (DRC), the project is an open-pit mine that is estimated to produce 440,000 tonnes per annum (tpa) at a minimum of 5.8% Li2O concentrate over its 20 years mine life.
AVZ Minerals already paid $500,000 to Dathomir Mining as an advance payment
AVZ has already paid $500,000 to the joint venture partner Dathomir Mining as an advance payment.
The remaining $15m be paid any time over next 12 months following the execution of the agreement, or immediately after the company secures a minimum of $50m project financing.
If the company fails to pay within 12 months, AVZ will lose the $500,000 payment it made as an advance and will also lose the rights for additional 10% stake in the project.
AVZ managing director Nigel Ferguson said: “The recently completed Definitive Feasibility Study clearly demonstrated our Manono Project is very robust, with strong financial metrics.”
“We are excited to have finalised the terms of our second Share Sale Purchase Agreement with Dathomir Mining, which upon completion, gives AVZ a 75% equity stake in the Manono Project.”
“This additional equity in the Manono Project will add significantly to the project’s bottom line and Net Present Value and is critical to AVZ’s ongoing discussions with prospective financiers.”