Midlands Minerals has signed a definitive agreement with Reservoir Minerals for an option to earn up to a 75% stake in the latter’s Parlozi Lead-Zinc-Silver project in Serbia.
As part of agreement, Midlands can earn an initial 51% interest in the project by spending C$4.5m ($4.09m) on exploration over the next four years.
The firm commitments include a minimum investment of C$500,000 before 30 September 2014, including reimbursement of exploration expenditures on the project by Reservoir since 06 June 2013 and 1,500m of drilling.
Midlands can later earn an additional 14% interest over two years by obtaining a mining exploitation permit from the Serbian Government and a further 10% by completing a bankable feasibility study within two years of obtaining a mining exploitation permit.
Midlands president and CEO Craig Pearman said the agreement has been concluded in goodtime to take full advantage of the rising market.
"Parlozi is well located in Serbia which has a strong tradition of mining, with infrastructure and skills, and is affordable and highly prospective for a junior explorer. We are looking forward to the first phase of drilling, "Pearman added.
Completion of the transaction is subject to customary closing conditions, including receipt of all regulatory approvals, including the consent of the TSX Venture Exchange.
The Parlozi permit covers occurrences of historic allead-zinc-silver mining in the Kosmaj-Babe area of the Sumadi jamining district in central Serbia.