UK-based mineral exploration company Kavango Resources has signed an exclusive, two-year option to acquire the Nara project, a producing gold project in Matabeleland, southern Zimbabwe.

Under the terms of the option agreement, Kavango will obtain full access to the Nara Project area to conduct field due diligence, through a comprehensive exploration programme.

The programme includes surface mapping and geochemistry, geophysics, surface drill testing, underground sampling, drill testing and assessing the potential for processing the tailings.

Kavango would pay an option fee of up to $220,000 over the two-year option period, in four individual payments of $55,000 each, at the start of each half-year of the option period.

Upon exercising the option to acquire the project, the company will pay $4m in cash, which will be deducted from the acquisition price.

If the company does not exercise the option, it will return all exploration data to the current operator of the claims, together with recommendations on future development.

Kavango CEO Ben Turney said: “After extensive due diligence over the last 12 months, including 4 visits to Matabeleland, we are delighted to announce our first gold exploration project in Zimbabwe.

“The greenstone belts in Zimbabwe host prospective rocks for bulk-mineable gold deposits, according to Kavango’s internal review and analysis. Many of these belts share notable similarities with some of Australia’s most prolific gold-producing regions.

“Zimbabwe has a strong tradition of mining. However, exploration and investment has been severely limited over recent decades.”

Nara Project hosts 45 contiguous gold claims and covers four historic tungsten and silver mines.

The project area has supported historic high-grade underground mining and continuous surface small-scale mining and custom milling over the last 30 years.

It has produced a total of 92,000oz gold averaging 9.76g/t from underground workings and generated around 150,000 to 250,000 tonnes of tailings.

Kavango has prepared an exploration plan for the Nara project, which includes surveying of the tailings, assessment of the historic mine shaft, underground drilling and channel sampling.

The company will also survey soil geochemical along the strike extent, scout drilling to test artisanal workings, other drilling and surveying, will initiate its exploration program in the future.

Turney added: “In 1980, Zimbabwe produced more gold than Australia but the country has yet to experience the bulk-mining boom Australia did midway through that decade.”

“We believe this presents a significant opportunity for Kavango and a commercial discovery.

“With the strong financial backing of Purebond, Kavango is now positioned to pursue the potential we have identified in Matabeleland alongside our portfolio in Botswana.”