Tan Range Exploration (TNX-A) has inked a deal with Minorca Resources (MAR-T) whereby the latter can acquire up to a 50% interest in the Itetemia gold property in Tanzania.
For its interest, Minorca must pay $10 million and complete a bankable feasibility study on the property, which is situated in the Lake Victoria gold district.
The deal also contains a financing component whereby Minorca will provide Tan Range with $1 million, to be raised in a private placement of units priced at 85cents each. Each unit will consist of one common share and one share purchase warrant exercisable into one common share at $1 within one year of the closing date, and at $1.50 during the second year.
The earn-in is divided into three phases. Initially, Minorca will have the option, within 12 months of the closure of the $1-million financing, of acquiring a 12.5% interest in the property for $5 million. In the second phase, 30 months from the date of the closure, Minorca can earn another 12.5% for $5 million. In the third phase, Minorca can earn an additional 25% by funding and completing a bankable feasibility study on the property.
The deal is subject to approval regulators and the boards of both companies.
All proceeds from the deal will be used for work at the Itetemia property.
The agreement follows the purchase by Minorca of a 12.2% interest in gold producer Dayton Mining (day-t) for $16 million. Dayton’s chief asset is the Andacollo open-pit gold operation in Chile, where resources stand at 130 million tonnes grading 0.7 gram gold per tonne at a cutoff of 0.3 gram.
Meanwhile, Tan Range has announced a public offering of 2.3 million special warrants at 85cents each, for proceeds of $2 million. Funds raised will be used for the exploration of the company’s properties in eastern Africa.
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