Northwestern Mineral Ventures (NWT-V, NWTMF-O) and UraMin (UMN-T, UMN-L) are joint venturing on eight prospective uranium concessions covering 6,773 sq km in Niger.
The deal will see Toronto-based Northwestern take a 50% stake in the new company, and receive a cash payment of $4.8 million and a 3% net smelter royalty on any production from its Irhazer and In Gall concessions two of the eight properties in the yet-to-be-named new company’s uranium portfolio.
News of the merger follows closely on the heels of Northwesterns May 29 announcement that Irhazer and In Gall returned values from 0.22% U3O8 to 1% U3O8 from five of 16 surface rock samples collected from outcrops.
For its 50% stake UraMin is contributing six uranium properties and US$15 million.
Midday in Toronto Northwestern shares were up a penny to 73 on roughly 1.1 million shares traded. Gauteng-based UraMin was off a penny to $7.12 on nearly 500,000 shares traded.
Northwestern is saying its shareholders will benefit from UraMins experience in Africa, as it has three uranium development projects underway on the continent.
UraMin is bringing its Trekkopje uranium project in Namibia, Bakouma uranium project in Central African Republic and its Ryst Kuil uranium project in South Africa into feasibility. Trekkopje is the most advanced with commercial production slated for late 2008.
“With the US$15 million investment from UraMin, we have a solid financial foundation combined with considerable technical resources at our disposal, Northwesterns president and chief executive Marek Kreczmer said in a statement.
Kreczmer will take the reigns as managing director and chief executive of the new company.
UraMin’s chief executive, Ian Stalker, will step in as the executive deputy chairman and president of the new company.
“By combining our resources in Niger we not only bring together the highly prospective license areas of both companies but we also marry Northwestern’s established exploration team in Niger with UraMin’s international mining team,” Stephen Dattels, deputy chairman of UraMin said in a statement.
The companies say the merger will allow the new company to undertake a major exploration program at a pace quicker than what would have been possible otherwise.
The UraMin properties — Kamas 1 to 4 and Dabala 3 and 4 — are situated along the proven Arlit fault, in the same geographic area as two of Arevas uranium mines in Niger. The West African country is one of the world’s top uranium-producing nations.
UraMin also has exploration projects in Chad, Niger, Senegal and Mozambique as well as two exploration projects in Canada.
Northwestern has prospective uranium properties in Niger and Canada and a precious and base metal property in Mexico.
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