Botswana Metals Limited says Botswana Government through the Department of Mines has granted an extension to three of its exploration licences for a period of two years effective from 1 April 2014.
The company said the granting of the extension to PL110/94, PL111/94 and PL54/98 now activates a Farm-in Joint Venture agreement with BCL Limited, a Botswana mining and smelting operation owned by the Botswana Government and Russian giant Norilsk.
Under the agreement BCL can fund up to the completion of a bankable feasibility study (BFS) to earn a 70% interest in the three prospecting licences (PLs) that cover approximately 185 km of BML’s 1,500 km exploration portfolio.
BML’s Chairman Pat Volpe said the Joint Venture partnership makes sense as the BML discovery projects are only 55 km from BCL’s nickel-copper mine, process plant and smelter; at Maibele North, the Ni + Cu + Platinum Group Elements mineralisation is similar to that being mined by BCL.
He said BCL has established crushing, milling, flotation and smelter plants available that can in effect “toll treat” the Joint Venture ore which will significantly reduce any capital outlay in developing the projects.
“BCL has the marketing and sales team in place with international client base to sell the final product; (and) BCL will provide BML and the Joint Venture with the expertise, logistics and access to plant and equipment.”
BCL also has a first right of refusal to fund the exploration on the balance of the BML exploration portfolio that covers the extension of the Limpopo belt into Eastern Botswana from Zimbabwe.
Both BCL and BML plan to immediately commence exploration and drilling activities on these three prospecting licences: PL110/94 (Maibele North Project for: Ni + Cu + Platinum Group Elements and Airstrip Project for: Cu +Ag), PL111/94 (Dibete Project for: Cu + Ag) and PL54/98 (23 identified VTEM anomalies) with the objective of completing a feasibility study into the potential of mining and trucking ore to the BCL operations at Selebi Phikwe just 55 km to the south of BML’s projects.
BCL has publicly stated that it has a policy to find business opportunities that can extend the longevity of the mining and smelting operations located at Selebi Phikwe. BCL employs approximately 4,200 people and supports the township that has a population of around 52,000 people.
“The Joint Venture partnership can fast track our efforts towards potential mining. BML’s projects provide the potential for additional ore particularly for Nickel and Copper that can be trucked to the BCL plant which has been operating at Selebi Phikwe since the 1960s,” said Volpe.
“Of the three BML projects, the Maibele North discovery will be the priority for immediate exploration and drilling as previous drilling intercepted nickel mineralisation at around a depth of 50 m. The proximity of BCL’s operation and infrastructure at Selebi Phikwe will significantly reduce the capital and operating cost of any potential mine at Maibele North and at our other projects at Airstrip Copper and Dibete.”
BCL Investments (Pty) Limited, under the joint venture agreement, will spend an initial US$4 million on a drilling program to earn 40% of the projects over these areas. BCL has the option to continue to fund the projects to the completion of a BFS to earn a 70% interest.
At that point BCL will have the off-take rights at commercial prices, to any ore mined. It is planned to truck ore to the BCL smelter operations at Selebi Phikwe for processing, which is situated 55 km to the southwest of our projects. BML will retain a 30% interest after the BFS is completed, at which time the management of the projects will be transferred to BCL.