PERTH (miningweekly.com) – Junior Black Mountain Resources has completed its restructure, disposing of its interest in the Namekara vermiculite mine, and changing its name to Hipo Resources.

Black Mountain in February this year flagged a change in direction to focus on its lithium farm-in agreement in the Democratic Republic of Congo (DRC), and disposing of the Namekara mine, in Uganda, in exchange for the cancellation of some A$5.5-million in debt.

The company said at the time that inconsistent vermiculite sales had impacted Black Mountain’s ability to achieve its intended cash flow from the Namekara mine, meaning that the company was consistently unable to service its debt obligations.

The divestment meant that Black Mountain was now debt free, apart from some minor trade creditors.

Black Mountain has retained a 75% interest in the Busumbu phosphate project, which is located some 3 km east of the Namekara mine and exists on the same mining licence, subject to the company spending a minimum of $1-million a year over the next three years, and committing to take the project into commercial production within another two years.

In addition to its majority interest in the Busumbu project, Black Mountain also holds an option over the Crown lithium project, in the DRC.

“The Busumbu project and the Crown lithium option are very valuable assets, and we are committed to developing both,” said executive director Maurice Feilich.

“Now that we have completed this transaction in Uganda, which greatly strengthens the company’s balance sheet, we have two clear objectives; firstly we plan to complete due diligence on the Crown project and report assay results from our fieldwork very soon. This will determine how we structure any farm-in to this very attractive asset.

“Secondly, we are in the final stages of negotiating farm-in terms with three different parties that have expressed an interest in exploring and developing Busumbu for its diverse mineralisation.”

Feilich noted that securing farm-in partners in Uganda would greatly reduce the company’s expenditure, while also allowing Black Mountain to benefit from any exploration and development success. It also freed up funds to progress more lithium and cobalt opportunities in the DRC, and assess other opportunities to diversify the company’s asset base.