South Perth-based mining explorer Extract Resources Ltd and Burswood-based Tectonic Resources NL have agreed to sell their interests in the Burnakura gold project joint venture to Canadian company ATW Venture Corp, the companies have announced.
South Perth-based mining explorer Extract Resources Ltd and Burswood-based Tectonic Resources NL have agreed to sell their interests in the Burnakura gold project to Canadian company ATW Venture Corp, the companies have announced.
Under the agreement, ATW will pay a combiuned $4 million in cash and issue 5 million shares and 5 million warrants to the two companies, to be divided between the joint venture partners.
Extract expects the net realisable nominal value from the sale to be around $6 million.
The two companies also divested their stakes in the Tuckabianna gold project after reaching an agreement with Silver Lake Resources Ltd.
The full text of a joint comapny announcement is pasted below, followed by one from Extract
The Burnakura Joint Venture (BJV) participants, Tectonic Resources NL (ASX: TTR) and Extract Resources Limited (ASX: EXT) are please to announce the execution of a Letter of Intent (LOI) to divest both parties' interests in the Burnakura Project to TSX Venture Exchange listed company ATW Venture Corp (TSXV: ATW)
The general terms of the proposed sale are:
- Payment of a $100,000 non refundable deposit upon signing the LOI.
- Execution of a formal agreement subject to completion of due-diligence
- Balance of AUD $3,900,000 cash payable on completion
- Issue of 5,000,000 shares in ATW (ATW last traded at C$0.63).
- 5,000,000 warrants (3 years or as determined under policies of the TSXV) exercisable at a 25% premium to the ATW share price as at date of signing.
- Upon completion the new entity will assume all rights, liabilities and obligations associated with the tenements constituting the Burnakura Project.
The sale is subject to ratification under TSXV listing rules requiring lodgment of a National Instrument 43-101 compliant technical report and a capital raising of not less than CAD$6,000,000.
The agreement contemplates completion of the transaction prior to mid-December
After lengthy negotiations with various parties the joint venture is confident this represents the best outcome for both groups of shareholders. After thorough due diligence we believe the experience and credentials of ATW will provide the project the best opportunity of success through a well funded, targeted exploration program leading to expansion of an already substantial 391,000 ounce resource base.
The full text of the Extract announcement is pasted below
Extract Resources (ASX: EXT) is pleased to advise that the company has completed divestment of the part-ownership in its Australian gold assets thereby enabling the Company to focus entirely on its rapidly developing uranium projects in Namibia.
Extract's part-interest in both the Burnakura and Tuckabianna gold projects in the Murchison Region of Western Australia, are now under conditional sale agreements. As previously announced the Tuckabianna Project is under sale agreement with Silver Lake Resources which plans to list on the ASX in November; following that a Letter of Intent has been signed with ATW Ventures, a Toronto-listed company, for the sale of the Burnakura Project.
Subject to conditions being finalised for both transactions, the net realisable nominal value to Extract is A$6m incorporating cash, environmental bond replacement, shares and share options (in ATW).
Extract Resources Managing Director, Peter McIntyre said that the divestment is consistent with the Company's strategy to focus on the Namibian uranium assets. "Our part-interest in these gold assets was non-core to our business plan, and the capital is better invested in our 100%-owned assets in Namibia, where our current objective is advancing the uranium projects through resource definition, and commencing a detailed feasibility study in the second half of 2008. We are very comfortable with the long-term outlook for the uranium market, and will continue to invest in the obvious potential of the Husab Project to establish the Company as a significant uranium producer." Mr McIntyre said.
