Weatherly International PLC Weatherly to acquire Zambian copper project (0277Z)
12 December 2017 - 6:00PM
UK Regulatory
TIDMWTI
RNS Number : 0277Z
Weatherly International PLC
12 December 2017
12 December 2017
This announcement includes release of insider information
Weatherly International plc (AIM:WTI)
("Weatherly" or "the Company")
Weatherly enters into agreement to acquire Zambian copper
development project
Weatherly is pleased to announce that it has entered into a
binding agreement to purchase 100% of the Kitumba copper project in
Zambia from ASX-listed Intrepid Mines Limited ("Intrepid").
The key terms of the transaction are up-front consideration of
AU$ 4.75 million in cash upon transaction completion, plus deferred
consideration of AU$ 0.5 million upon a Decision to Mine and a
further AU$ 0.5 million upon achieving Commercial Production. The
transaction is subject to certain Conditions Precedent including
Intrepid shareholder approval and any regulatory approvals required
in Zambia and Australia. Weatherly has obtained a waiver from Orion
Mine Finance to use part of the uncommitted US$10m loan announced
on 28 July 2017 to fund the transaction to the extent that the
Company is unable to fund it through operating cash flows.
The advanced Kitumba copper development project hosts a
JORC-compliant measured and indicated resource of 24.9Mt at a
copper grade of 2.32% containing 578,000 tonnes of copper. Included
within this resource is a JORC-compliant reserve of 21.9Mt at a
copper grade of 2.20%Cu containing 492,000 tonnes of copper.
The Kitumba deposit is contained within a granted mining license
valid until 2029, while the wider project area also includes four
exploration licenses, with a combined current mining and
exploration tenure area covering more than 900 square
kilometres.
To date an estimated US$30 million or more has been spent on
exploration, drilling, metallurgical testwork and other studies for
Kitumba, and the purchase includes a fully established exploration
camp on site. The development of the Kitumba mine is also already
environmentally permitted based on the development plan proposed by
Intrepid.
This transaction is consistent with the Company's stated
strategy of pursuing growth through developing and operating
profitable medium-scale base metals mines in lower-risk parts of
Africa.
The Kitumba project is an excellent fit for the project
development and operational mining capabilities of Weatherly in the
Southern African region, and the Company is confident in its
ability to rapidly advance the project towards construction and
production in the near term.
Zambia is a well-established mining jurisdiction and is the
second-largest producer of copper in Africa. Weatherly has solid
capabilities built up while operating in adjacent Namibia for over
ten years, and members of the Board and senior management team have
extensive experience working in the Zambian mining sector. As a
result, Weatherly is well placed to work constructively and
transparently with the Zambian authorities to maximise the benefits
of the Kitumba deposit for all stakeholders.
Further announcements regarding the transaction progress and
Weatherly's Kitumba project development plans will be made in the
near term.
The Company and its subsidiaries are unlikely to generate
sufficient surplus cash to meet all loan repayments when due,
particularly in the near term. The Company continues to positively
engage with Orion on the subject.
For further information please contact:
Weatherly International plc +44 (0) 1707 800 774
Craig Thomas, Chief Executive Officer
Kevin Ellis, CFO and Company Secretary
RFC Ambrian Limited +44 (0) 20 3440 6800
(Nominated Adviser & Broker)
Nominated Adviser Contact: Stephen Allen / Bhavesh Patel
Broker Contact: Charlie Cryer
About Weatherly
Weatherly is an AIM listed copper mining company operating in
Namibia in southern Africa. Its principal assets are one operating
open pit copper mine called Tschudi and two underground copper
projects called Otjihase and Matchless.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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