TIDMKIBO
RNS Number : 4775C
Kibo Mining Plc
19 January 2015
Kibo Mining Plc (Incorporated in Ireland)
(Registration Number: 451931)
(External registration number: 2011/007371/10)
Share code on the JSE Limited:KBO
Share code on the AIM: KIBO
ISIN: IE00B61XQX41
("Kibo" or "the Company")
Dated: 19 January 2015
Memorandum of Understanding - Morogoro
Kibo Mining Plc ("Kibo" or the "Company") (AIM:KIBO; JSE AltX:
KBO), the Tanzania focused mineral exploration and development
company, is pleased to announce that it has entered into a
Memorandum of Understanding ("MOU") for a 50/50 Joint Venture
("JV") with Metal Tiger plc ("Metal Tiger") on the Company's
Morogoro South gold-prospective exploration portfolio in Tanzania
("Morogoro Portfolio"). The Morogoro Portfolio has a number of
exploration rights in central Tanzania, consisting of 18 licences,
offers, applications and tenders covering a combined surface area
of approximately 1,400 square kilometres.
Louis Coetzee, Chief Executive Officer of Kibo Mining plc,
commented: "We are delighted to announce this MOU that builds upon
our existing working relationship with Metal Tiger. When
established, this JV will mean that all five of the Company's
projects will be active and operational, which puts the Company in
a superb position and means shareholders can look forward to news
flow across the entire breadth of the Company's assets.
We are also pleased to agree the warrant component of the JV,
including the key price escalator clause. The working arrangement
with Metal Tiger has already seen GBP450,000 cash with no expenses,
injected directly into Kibo Mining in the last 7 weeks. This
additional cash has further strengthened our financial position
which is extremely helpful as we engage with third parties to
conclude commercial transactions on our projects.
Kibo Mining is fundamentally healthy and more advanced than ever
in its history. We intend to make that count for shareholders."
Background
Under the MOU Metal Tiger has up to and including 20 February
2015 to complete its due diligence process and within which period
the parties are to complete and sign a binding JV agreement. The
terms of the MOU would see Metal Tiger pay for the ongoing licence
renewal fees and other maintenance costs for a minimum of 12 months
(estimated to be approximately US$100,000 p.a.) and up to a maximum
of 3 years within which timeframe Metal Tiger is to expend a total
of US$800,000 on project costs (including licence renewal fees) and
an agreed exploration work program, to maintain its 50% interest in
the JV. Should Metal Tiger expend less than a total of US$800,000
whilst maintaining the Morogoro Portfolio licences, but not less
than US$300,000 then Metal Tiger's 50% interest in the JV will
revert to a 10% free carry interest on the Morogoro Portfolio.
Should Metal Tiger expend less than US$300,000 in total then Metal
Tiger's total interest in the JV shall revert back to Kibo.
As part of the JV, should it proceed, Kibo will issue Metal
Tiger with warrants over 10,000,000 new ordinary shares in Kibo,
exercisable within a three-year term at an exercise price of 9p
each but subject to a mechanism to increase the warrant exercise
price in the event Kibo's share price trades at a significant
premium as follows:
-- In the event that Kibo's listed closing mid-market share
price on the AIM market of the London Stock Exchange ("AIM")
exceeds 18 pence (GBP0.18) per share for a consecutive period of 15
days in which AIM is open, then the exercise price of any
unexercised warrants shall increase from 9 pence (GBP0.09) to 14.5
pence (GBP0.145);
-- In the event that Kibo's listed closing mid-market share
price on AIM exceeds 27 pence (GBP0.27) per share for a consecutive
period of 15 days in which AIM is open, then the exercise price of
any unexercised warrants shall increase to 19 pence (GBP0.19).
Gold Prospective Joint Venture Areas - Morogoro South
Jubilee Resources LTD, a wholly owned subsidiary of Kibo Gold
Limited, itself a wholly owned subsidiary of Kibo Mining Plc (LON:
KIBO), owns a portfolio of gold prospective mineral licences for
exploration in Tanzania (collectively the "Morogoro South
Portfolio").
The Morogoro South Portfolio is located in the emerging
goldfield of the Morogoro-Dodoma-Handeni region within a 90
kilometre radius of the city of Morogoro, Tanzania. The portfolio
consists of 18 licences, offers, applications and tenders with a
combined surface area of approximately 1,400 square kilometres.
Key Terms of the Memorandum of Understanding
Following completion of the due diligence period by/on 20
February 2015and the parties entering into the JV agreement as
outlined in the MOU, the parties are to operate under a 50/50 Joint
Venture of the gold-prospective properties that form the Morogoro
South Portfolio, as follows:
-- Metal Tiger is to acquire 50% of Kibo Gold Limited or its
duly appointed nominee ("KB Gold"), a 100% wholly owned subsidiary
of Kibo Mining plc that owns the Morogoro South Portfolio for a
consideration of GBP1.
-- Metal Tiger is to meet the expenses in relation to the
licence renewal fees and other maintenance costs of the Morogoro
South Portfolio for a minimum of 1 year (estimated to be
approximately US$100,000 p.a.) and up to a maximum of 3 years.
-- Metal Tiger is to expend the first US$800,000 under the JV in
expenses and exploration relating to the Morogoro South Portfolio,
at which point costs moving forward are shared 50/50 between the
parties.
-- Should Metal Tiger elect to not continue with the JV after
the minimum term of one year, or fail to expend US$100,000 by the
first anniversary of the JV, or should Metal Tiger fail to expend
the full expenditure by the third anniversary of the JV then:
o if less than US$300,000 of the agreed expenditure, the 50%
interest in the JV owned by Metal Tiger shall revert back to KB
Gold subject to them exercising a claw-back option;
o if greater than US$300,000 of agreed expenditure, Kibo shall
have the right to exercise the claw-back option in respect of Metal
Tiger's interest in KB Gold, however Metal Tiger shall retain a 10%
free carry interest in the Morogoro South Portfolio.
-- At any time following the first anniversary of the JV, on not
less than 90 days' notice to Kibo, Metal Tiger may elect to cease
sole funding of the JV expenditure.
The acquisition by Metal Tiger of the interest in KB Gold is
conditional, inter alia, on:
-- by not later than 20 February 2015 Metal Tiger conducting,
and confirming in writing that it is satisfied (at its sole
discretion) with the results of the legal, financial and technical
due diligence investigations to be undertaken by Metal Tiger in
relation to the Morogoro South Properties and KB Gold; and
-- Kibo and KB Gold procuring all necessary consents from the
regulatory authorities in Tanzania.
Contacts
Louis Coetzee +27 (0) 83 2606126 Kibo Mining Chief Executive Officer
plc
------------------ ------------------- ---------------- ------------------------
Andreas Lianos +27 (0) 83 4408365 River Group Corporate Adviser
and Designated Adviser
on JSE
------------------ ------------------- ---------------- ------------------------
Jon Belliss +44 (0) 20 3693 Hume Capital Broker
Abigail Wayne 1470 Securities
Plc
------------------ ------------------- ---------------- ------------------------
Oliver Morse +61 8 9480 2500 RFC Ambrian Nominated Adviser
and Trinity Limited on AIM
McIntyre
------------------ ------------------- ---------------- ------------------------
Daniel Thöle +44 (0) 203 772 Bell Pottinger Investor and Media
Lucinda Alderson 2500 Relations
------------------ ------------------- ---------------- ------------------------
Kibo Mining - Notes to editors
Kibo Mining is listed on the AIM market in London and the AltX
in Johannesburg. The Company is focused on exploration and
development of mineral projects in Tanzania, and controls one of
Tanzania's largest mineral right portfolios. Tanzania provides a
secure and stable operating environment for the mineral resource
industry and Kibo Mining therein.
Kibo Mining holds a thermal coal deposit at Rukwa, which has a
significant JORC compliant defined resource (See Table 1 below),
and is developing a 250-350MW mouth-of-mine thermal power station
with an established management team that includes Standard Bank as
Financial Advisor. Kibo is undertaking a Coal Mining Definitive
Feasibility Study and a Power Pre-Feasibility Study for Rukwa with
an integrated Coal-Power interim study report to be released in the
near term.
The Company also has extensive gold focused interests including
Lake Victoria Goldfields and Morogoro projects. At Lake Victoria,
the Company has projects with a 550,000oz JORC compliant gold
Mineral Resource at Imweru Project (See Table 2 below) and a
168,000oz NI 43-101 compliant gold Mineral Resource at the Lubando
Project (See Table 3 below) in which the Company holds a 90%
attributable interest. The Company is currently undertaking a
Definitive Feasibility Study on its Imweru Project, with
Preliminary Economic Assessment study findings to be released in
the near term.
Kibo also holds the Haneti Project on which the latest technical
report confirms prospectivity for nickel, PGMs, gold and strategic
metals including Lithium. The company is undertaking a geochemical
review of the project, the results of which will be available in
the near term.
Kibo Mining further holds the Pinewood (coal & uranium)
project where the company has signed a MOU to enter into a 50/50
Exploration Joint Venture with Metal Tiger plc.
Finally the Company also holds the Morogoro (gold) project where
the company has signed a MOU to enter into a 50/50 Exploration
joint Venture with Metal Tiger plc.
The Company's projects are located in the established and gold
prolific Lake Victoria Goldfields, the emerging goldfields of
eastern Tanzania and the Mtwara Corridor in southern Tanzania where
the Government has prioritised infrastructural development
attracting significant recent investment in coal and uranium. The
Company has a positive working relationship with the Tanzanian
government at local, regional and national levels and works hard to
maintain positive relationships with all communities where company
interests are held. The Company recognises the potential to enhance
the quality of life and opportunity for Tanzanian citizens through
careful development of its projects.
Updates on the Company's activities are regularly posted on its
website www.kibomining.com
Technical data
Rukwa Mineral Resource
Table 1 below presents a table showing the Mineral Resource
estimate for the Rukwa Coal Project. The table is taken from an NI
43 101-Compliant Report by GEMECS (Pty) Ltd dated April 2012.
Table 1
RUKWA COAL RESOURCE SUMMARY- GEMECS (Pty) Ltd
--------------------------------------------------------
SEAM NI 43-101 IN SITU
---------- ----------------- ---------- -------------
SEAM THICKNESS CLASS MILLION TONS
---------- ----------------- ---------- -------------
S4 1.14 Indicated 2.17
---------- ----------------- ---------- -------------
S3U 2.04 Indicated 6.92
---------- ----------------- ---------- -------------
S3L 2.3 Indicated 12.63
---------- ----------------- ---------- -------------
S2 3.45 Indicated 23.43
---------- ----------------- ---------- -------------
S1U 2.48 Indicated 7.34
---------- ----------------- ---------- -------------
S1L 2.92 Indicated 17.4
---------- ----------------- ---------- -------------
S0 1.08 Indicated 1.44
---------- ----------------- ---------- -------------
Total Indicated Resources 71.34
----------------------------- ---------- -------------
S4 1.31 Inferred 1.38
---------- ----------------- ---------- -------------
S3U 2.24 Inferred 2.94
---------- ----------------- ---------- -------------
S3L 2.27 Inferred 3.86
---------- ----------------- ---------- -------------
S2 3.42 Inferred 7.94
---------- ----------------- ---------- -------------
S1U 2.05 Inferred 6.5
---------- ----------------- ---------- -------------
S1L 3.15 Inferred 12.83
---------- ----------------- ---------- -------------
S0 1.06 Inferred 2.6
---------- ----------------- ---------- -------------
Total Inferred Resources 38.05
----------------------------- ---------- -------------
TOTAL RESOURCES *109.39
----------------------------- ---------- -------------
*Kibo holds 100% of the Rukwa Mineral Resource
Imweru Mineral Resource
Table 2 below presents a table showing the Mineral Resource
estimate for the Imweru Project at a base case economic cut-off
grade for the reporting of the resource of 0.4 g/t. The table is
taken from a JORC-Compliant Report by Tetra Tech EBA dated February
2014.
Table 2
Material Cut- Specific Metric Gold Contained
Area Type Classification off Gravity Tonnes Short Grade Gold Ounces
(g/t) (t) Tons (g/t) (troy)
========= ============= ================== ======== ============ ============ ============ ======== ===============
Laterite Indicated 0.40 2.50 131,000 144,000 1.785 8,000
============= ============================ ======== ============ ============ ============ ======== ===============
Saprolite Indicated 0.40 2.50 706,000 778,000 1.387 32,000
============= ============================ ======== ============ ============ ============ ======== ===============
Bedrock Indicated 0.40 2.89 1,895,000 2,089,000 1.043 64,000
============= ============================ ======== ============ ============ ============ ======== ===============
Central Total Indicated 0.40 2.77 2,732,000 3,012,000 1.168 103,000
========= ============= ================== ======== ============ ============ ============ ======== ===============
Laterite Inferred 0.40 2.50 685,000 755,000 1.317 29,000
============= ============================ ======== ============ ============ ============ ======== ===============
Saprolite Inferred 0.40 2.50 1,047,000 1,154,000 1.040 35,000
============= ============================ ======== ============ ============ ============ ======== ===============
Bedrock Inferred 0.40 2.89 7,838,000 8,640,000 1.029 259,000
============= ============================ ======== ============ ============ ============ ======== ===============
Central Total Inferred 0.40 2.82 9,569,000 10,548,000 1.051 323,000
========= ============= ================== ======== ============ ============ ============ ======== ===============
East Total Inferred 0.40 2.70 2,653,000 2,925,000 1.449 124,000
========= ============= ================== ======== ============ ============ ============ ======== ===============
Indicated 0.4 2.77 2,732,000 3,012,000 1.168 103,000
========================================== ======== ============ ============ ============ ======== ===============
Inferred 0.4 2.79 12,222,000 13,473,000 1.137 447,000
========================================== ======== ============ ============ ============ ======== ===============
Imweru Property Combined
Total (inf+ind) 0.4 2.79 14,954,000 16,485,000 1.143 550,000
======================== ================== ======== ============ ============ ============ ======== ===============
*Kibo holds 90% of the Imweru Mineral Resource
* Total estimates are rounded, based on composites capped at 26
g/t gold at Imweru Centraland 25 g/t at Imweru East, the cut-off
grade isbased on a gold price of US$1,200 and a 90% metallurgical
recovery is assumed in calculation of cut-offgrade. A base case of
0.40 g/t has been selected.
** Classification of MineralResources incorporates the terms and
definitions from the Australian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves (JORC Code) published
bythe Joint Ore Reserve Committee (JORC)
Lubando Mineral Resource
Table 3 below presents a table showing the Mineral Resource
estimate for the Lubando Project at a base case economic cut-off
grade for the reporting of the resource of 0.5 g/t Au. The table is
taken from an NI 43 101-Compliant Report by EBA Engineering
Consultants Limited (now part Tetra Tech EBA) dated August
2009.
TABLE3: LUBANDO MINERALRESOURCE SUMMARY - BASECASE*
-------------------------------------------------------------------------------------------------------
East Zone East Zone
Category West Zone South East Zone North Total
Mid
--------------------------- -------------- ------------- ------------- ------------- -------------
Measured Resource
--------------------------- -------------- ------------- ------------- ------------- -------------
Measured Resource(t) 107,900 4,880 16,900 54,440 184,150
--------------------------- -------------- ------------- ------------- ------------- -------------
Grade(g/t) 1.69 2.52 1.72 2.48 1.95
--------------------------- -------------- ------------- ------------- ------------- -------------
Total Gold(oz) 5,900 400 950 4,340 11,500
--------------------------- -------------- ------------- ------------- ------------- -------------
Indicated Resource
--------------------------- -------------- ------------- ------------- ------------- -------------
Indicated Resource(t) 280,710 18,330 61,000 149,350 509,420
--------------------------- -------------- ------------- ------------- ------------- -------------
Grade(g/t) 1.61 2.23 1.89 2.73 1.99
--------------------------- -------------- ------------- ------------- ------------- -------------
Total Gold(oz) 14,500 1,300 3,700 13,120 32,600
--------------------------- -------------- ------------- ------------- ------------- -------------
Inferred Resource
--------------------------- -------------- ------------- ------------- ------------- -------------
Total Resource(t) 1,090,000 65,470 209,340 535,330 1,900,140
--------------------------- -------------- ------------- ------------- ------------- -------------
Grade(g/t) 1.27 1.56 3.34 3.13 2.03
--------------------------- -------------- ------------- ------------- ------------- -------------
Total Gold(oz) 44,550 3,300 22,500 53,900 124,200
--------------------------- -------------- ------------- ------------- ------------- -------------
*Kibo holds 90% of the Lubando Mineral Resource
* Numbers are rounded. Composites capped at 10.85g/t gold.
Cut-off grade of 0.5 g/t gold based on a gold price of US$850/oz
and assumed 100% metallurgical recovery.CIM definitions were
followed for Mineral Resources.
Pursuant to the terms of an inherited agreement with Barrick
East Africa Exploration LTD (BEAL), Kibo currently has an effective
90% interest in the Imweru and Lubando Project (and thus a 90%
attributable interest in the Imweru and Lubando Mineral Resources
shown in Table 2 and 3 above), with Barrick having a 10% carried
interest up to a decision to mine at which point they have to
contribute or be diluted to a 2% net smelter royalty. BEAL also has
a first right of refusal pursuant to which they can buy the 90%
interest in the project at an agreed market related value after
completion of a Bankable Feasibility Study. Kibo remains the
operator of the project.
Review by Qualified Persons
The information in this announcement that relates to the Rukwa
Coal Mineral Resource is taken from a report titled "Independent
Technical Report for the Rukwa Coal Project, Mbeya Region, United
Republic of Tanzania" dated 19(th) April 2012 by CD van Niekerk
Director and Principal Geologist with the firm GEMECS (Pty) Ltd. Mr
van Niekerk is a Professional Natural Scientist with the South
African Council for Natural Scientific Professions (SACNASP),
Registration No. 400066/98 and a Fellow Member of the Geological
Society of South Africa. He has relevant experience and technical
qualifications to be a "Qualified Person" for reporting coal
resources to the NI 43-101 Standard
Information in this announcement that relates to the Imweru
Mineral Resource is taken from the report titled "Resource Update
for the Imweru Property Geita Region Northern, Tanzania, JORC
Competent Persons Report" dated February 17(th) 2014 (the
"Report"). The Report states a JORC-compliant Mineral Resource
estimate and was prepared for Kibo Mining plc by James Barr P.Geo.
and Darryn Hitchcock P.Geo. Senior Geologist and Geologist
respectively with TetraTech EBA Ltd. Both Mr. Barr and Mr.
Hitchcock are registered as Certified Professional Geologists with
Association of Professional Engineers and Geoscientists of British
Columbia a recognised professional organisation. Mr Barr as
principal author responsible for the Report has experience in the
evaluation and reporting of Archaean Gold projects and is a
"Qualified Person" for reporting gold resources to the JORC
Standard. He consents to the inclusion in this document of the
matters based on his information in the form and context in which
they appears.
The information in this announcement that relates to the Lubando
Mineral Resources is taken from a report titled "Technical Report
on the Lubando property, Mwanza, Tanzania" dated 31(st) August
2009" (the "Report") The Report is NI 43-101 compliant and was
prepared for Great Basin Gold Rusaf Gold Limited by Nathan Eric
Fier C.P.G., P.Eng. Market Director for EBA Engineering Consultants
Ltd and a Senior Mining Consultant. Mr. Fieris registered as a
Certified Professional Geologist with the American Institute of
Professional Geologists, Registration No 10062, and a professional
Engineer in British Columbia, Canada Registration No. 135165. He
has extensive experience in the evaluation and reporting of
Archaean Gold projects.
The Company's Exploration Director, Noel O'Keeffe has reviewed
the resource reports and the references to them in this
announcement.
Johannesburg
19 January 2015
Corporate and Designated Adviser
River Group
This information is provided by RNS
The company news service from the London Stock Exchange
END
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