Tsodilo Resources Limited said through its wholly-owned subsidiary Gcwihaba Resources it has struck a deal with First Quantum Minerals Ltd (Faloxia Proprietary) for a Earn-In Option Agreement interest in metals prospecting licences in Botswana.
Under the terms of the Option Agreement, First Quantum can earn either a 51% participating interest or a 70% participating interest in designated projects within the overall license area covered by the Option Agreement.
However, it has to satisfy the funding exploration expenditures within the Project Area in the aggregate amount of US$6 million by November 20, 2015 (the “Tranche 1 Funding Commitment”).
It also has to fund an additional US$9 million in exploration expenditures within the Project Area by November 20, 2017; and complete a technical report (a “Technical Report”) on a designated area within the Project Area prepared in compliance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators and that meets certain requirements with respect to resources.
Tsodilo’s Chairman and CEO, James M. Bruchs, said they are pleased to have the Earn-in Option Agreement signed saying although it took longer than was originally expected, both companies have been working together in the spirit of the April 17, 2013 original Memorandum of Understanding.
“This joint venture will allow FQM to aggressively explore for world-class base metal deposits on our licensed areas while enabling Tsodilo to accelerate the evaluation of our Xaudum iron formation project as well as continue our kimberlite exploration. The involvement of First Quantum will allow us to deliver results from our metals projects to the market sooner than we could have without their efforts.”
According to a statement, the Tranche 1 Funding Commitment is a firm commitment by First Quantum and must be satisfied irrespective of whether First Quantum elects to pursue the other requirements to earn an interest in Gcwihaba’s licences.
“In the event that First Quantum satisfies the funding obligations as set forth above but a Technical Report has not been completed by the end of the fourth year following the execution of the earn-in option agreement, First Quantum may maintain the earn-in option for up to an additional three years by continuing to spend a minimum of $2 million per year on exploration and evaluation studies on the Project Area.”
About First Quantum
First Quantum is one of the fastest growing copper companies with a projected compound annual growth in copper production of more than 20% for at least the next decade. First Quantum’s core strength is discovering, developing and operating mines efficiently and cost effectively. The recent combination of the First Quantum and Inmet assets has created one of the world’s leading copper producers with a geographically diversified portfolio of high-quality operations and development projects in eight countries across four continents.
About Tsodilo Resources Limited
Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Newdico (Pty) Limited (“Newdico”) and Gcwihaba Resources (Pty) Limited (“Gcwihaba”) projects in northwest Botswana. The Company has a 98% stake in Newdico (895 km² under Precious Stone – diamond licenses). The Gcwihaba project area: 2,404 km² under Precious Stone – diamond licenses; 11,158 km² Metal (base, precious, platinum group, and rare earth) licenses; and, 6,925 km² under Radioactive Minerals licenses is 100% held by the Company. Tsodilo manages the exploration of both the Newdico and Gcwihaba license areas. Overall supervision of the Company’s exploration program is the responsibility of Dr. Mike de Wit, President and COO of the Company and a “qualified person” as such term is defined in National Instrument 43-101. Dr. de Wit has reviewed the information contained herein and approved the contents of this Press Release.