Alexander Lemon, President of Mkango Resources, said: “This transaction is another milestone for Mkango and for Malawi, and is further endorsement of the Company’s strategy and potential.
With MetalNRG funding the Thambani uranium project and the previously announced transaction with Talaxis funding Mkango’s Songwe Hill rare earths project, Mkango shareholders can look forward to an exciting year of news flow and progress in two of the market’s most strategic commodities at present.
We are pleased to be working with MetalNRG, and look forward to a new drilling program being carried out at Thambani.”
First published, 3 April 2019
London / Vancouver: April 29th 2019 – Mkango Resources Ltd. (AIM/TSX-V: MKA) (the “Company” or “Mkango”) announces that it has entered into a Non-Binding Heads of Terms Agreement with MetalNRG PLC (NEX:MNRG) (“MetalNRG”), whereby MetalNRG will earn up to a 75% interest in the Thambani Exclusive Prospecting Licence (the “Thambani Licence”) in Malawi, by spending up to US$2,000,000 on exploration.
The terms of the Non-Binding Heads of Terms Agreement outline that the parties will enter into a Binding Definitive Agreement (the “Definitive Agreement”) on or before the 30th June 2019 that shall include the following elements:
· MetalNRG must spend US$500,000 on exploration within the Thambani Licence within 12 months of the date of the Definitive Agreement, including a drilling programme totalling approximately 1500 metres (the “Initial Workplan”). The details of the Initial Workplan will be determined in conjunction with Mkango. The completion of this Initial Workplan shall entitle MetalNRG to a 25% economic interest in the Thambani Licence, with such interest limited to uranium only.
· After the completion of the Initial Workplan, MetalNRG may elect to further explore and develop the Thambani License by spending US$700,000 over the subsequent 12 months (the “Second Workplan”). The completion of the Second Workplan shall entitle MetalNRG to a 49% economic interest in the Thambani Licence, limited to uranium.
· Following the completion of the Second Workplan, MetalNRG may elect to further explore and develop the Thambani License by spending US$800,000 over the subsequent 12 months (the “Third Workplan”). The completion of the Third Workplan shall entitle MetalNRG to a 75% economic interest in the Thambani Licence, limited to uranium.
· Mkango to have right of first refusal on 100% of the offtake for uranium and other minerals.
· If, following MetalNRG’s initial expenditure of US$500,000 and the completion of the Initial Workplan, MetalNRG is not satisfied with the exploration results produced during the first 12 months, it may elect, at its sole discretion, to discontinue future funding of the Second and Third Workplans, but it will retain a 25% economic interest in the uranium assets and operations which are the subject of the Thambani Licence. Subject to MetalNRG electing to discontinue future funding of the Second and Third Workplans, Mkango shall have the right to seek third party investment in order to raise sufficient capital to develop further the exploration area covered by the Thambani Licence. MetalNRG’s 25% economic interest will be diluted down when further exploration / development expenditure is made by Mkango or a third party.
About Mkango Resources Limited
Mkango’s primary business is exploration for rare earth elements and associated minerals in the Republic of Malawi, a country whose hospitable people have earned it a reputation as “the warm heart of Africa”. The Company holds interests in three exclusive prospecting licenses in Malawi: the Phalombe licence, the Thambani licence and the Chimimbe Hill licence.
The main exploration target in the 51% held Phalombe licence is the Songwe Hill rare earths deposit. This features carbonatite-hosted rare earth mineralisation and was subject to previous exploration in the late 1980s. Mkango completed an updated Pre-Feasibility Study for the project in November 2015 and a Feasibility Study is currently underway, the initial phases of which included a 10,900 metre drilling programme and updated mineral resource estimate.
The main exploration targets in Mkango’s remaining two 100% held licences are, in the Thambani licence, uranium, niobium, tantalum and zircon and, in the Chimimbe Hill licence, nickel and cobalt.
For more information, please visit www.mkango.ca.
