Salt Lake Potash Limited Salt Lake Potash and Blackham Resources Agreement (4006V)
08 April 2019 - 4:00PM
UK Regulatory
TIDMSO4
RNS Number : 4006V
Salt Lake Potash Limited
08 April 2019
8 April 2019 AIM/ASX Code: SO4
SALT LAKE POTASH LIMITED
Salt Lake Potash and Blackham Resources Execute Binding Access Agreement
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Highlights:
-- Salt Lake Potash has executed a binding Split Commodity and
Access Agreement with Blackham Resources in relation to the Lake
Way Project
-- Under the Agreement, Salt Lake Potash will acquire the brine
rights over Blackham's tenure and Blackham will acquire gold rights
over Salt Lake Potash's tenure. Each company retains a royalty on
their respective mineral resources
-- The Agreement with Blackham facilitates an accelerated
pathway to production through the utilisation of Blackham's Mining
Lease for early construction works and the de-watering and
utilisation of the Williamson Pit brine
-- The construction of the evaporation pond at Lake Way is
progressing well with 24-hour operations at site now underway
Salt Lake Potash Limited (Salt Lake Potash or the Company) is
pleased to announce that the Company has entered into a binding
Split Commodity and Access Agreement (Agreement) with Blackham
Resources Limited (Blackham) in relation to the development of the
Lake Way Project on terms in line with the previously executed MOU
announced on 12 March 2018.
Under the Agreement, Salt Lake Potash will acquire Blackham's
brine rights and Blackham will acquire gold rights to Salt Lake
Potash's Lake Way holdings, with each company retaining a royalty
on their respective holdings.
Key Terms
The Agreement is binding on Salt Lake Potash and Blackham with
the key terms including:
-- Salt Lake Potash to acquire the Brine Rights over the Blackham tenements;
-- Blackham to acquire the Gold Rights over the Salt Lake Potash tenements;
-- Salt Lake Potash to receive a 2% royalty on all gold
production from the Salt Lake Potash tenements;
-- Blackham to receive a 4% royalty on all Brine production
(including SOP) from the Blackham tenements;
-- Salt Lake Potash to make a rehabilitation liability payment
of $500,000 to Blackham by 30 June 2019. This amount is deductible
from future brine royalties;
-- Salt Lake Potash is required to achieve the following
construction and production milestones:
o Completion of the de-watering of the Williamson Pit by 31 July
2019;
o Commence the construction of the SOP processing plant by 30
June 2020; and
o Achieve first commercial production of SOP by 31 December
2021
These dates may be extended by mutual agreement.
The following Conditions Precedent must be satisfied within 2
months of the date of the Agreement (or such later date as may be
agreed by the parties):
-- the Minister consenting (to the extent required):
o to Blackham granting the Brine Rights to Salt Lake Potash;
o to Salt Lake Potash granting the Gold Rights to Blackham.
-- Blackham obtaining any approvals necessary to proceed with
the Agreement, including the release of various encumbrances
relating to the Brine Rights.
Lake Way Project
Salt Lake Potash is focussed on the rapid development of the
Lake Way Project, being a high grade salt-lake brine Sulphate of
Potash (SOP) operation. Lake Way's location and logistical
advantages make it the ideal Lake for the Company's first SOP
operation.
Lake Way is located in the Northern Goldfields Region of Western
Australia, less than 15km south of Wiluna. The surface area of the
Lake is over 270km2. The northern end of the Lake is largely
covered by a number of Mining Leases held by Blackham, the owner of
the Wiluna Gold Mine. The Agreement with Blackham allows for an
expedited pathway to development at Lake Way.
Construction Update
Salt Lake Potash commenced the construction of the first phase
of the Lake Way Evaporation Ponds at the start of March 2019 (see
announcement dated 6 March 2019). The first phase of evaporation
ponds will enable the de-watering of the Williamson Pit.
Construction works for the Lake Way Evaporation ponds are
progressing well with the Company moving into 24 hour operations
and are on target for completion in Q2 2019.
The de-watering of the Williamson Pit will commence in Q2 2019
once the first phase of the evaporation ponds is complete. Onsite
preparation works have commenced for de-watering activity including
preparation and welding of pipeline.
For further information please visit www.saltlakepotash.com.au
or contact:
Tony Swiericzuk/Clint McGhie Salt Lake Potash Limited Tel: +61 8 6559 5800
Jo Battershill Salt Lake Potash Limited Tel: +44 (0) 20 7478 3900
Colin Aaronson/Richard Tonthat/ Grant Thornton UK LLP (Nominated Adviser) Tel: +44 (0) 20 7383 5100
Ben Roberts
Derrick Lee/Beth McKiernan Cenkos Securities plc (Joint Broker) Tel: +44 (0) 131 220 6939
Jerry Keen/Toby Gibbs Shore Capital (Joint Broker) Tel: +44 (0) 20 7468 7967
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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