JOHANNESBURG (miningweekly.com) – Triple-listed Ferrum Crescent has secured the exclusive option to acquire private company GoldQuest, which owns two lead-zinc exploration projects in Spain, for about £465 000 in cash and shares.
Ferrum, which was focused on the development of its Moonlight iron-ore project, in South Africa, signed an option and sale agreement with GoldQuest’s parent company TH Crestgate to secure the exclusive option, which would be valid until July 31, for a staged option fee of up to £22 500.
GoldQuest owned the Toral project, comprising licences covering 2 024 ha in the Spanish province of León, and the Lago project, comprising licences in the province of Galicia – with both projects said to have high prospectivity for lead and zinc.
“With our Moonlight project in South Africa now being progressed pursuant to the previously announced farm-in and joint venture (JV) agreement with Business Venture Investments No. 1709 (BVI), the board is seeking to take advantage of the prevailing deep trough in asset prices to acquire additional low-cost assets in an attractive sector and region to augment the group’s asset portfolio and provide the opportunity to create shareholder value over the medium and longer term,” commented Ferrum MD Tom Revy.
Ferrum reported in October last year that it had signed a farm-in and JV agreement with BVI, which would fund a bankable feasibility study (BFS) on the Moonlight project in return for a 43% equity interest in Ferrum Iron Ore – the project’s holding company.
The BFS was expected to be completed in January 2017.
“In our view, the fundamentals for lead-zinc are extremely attractive, despite the generally depressed global commodity markets. Therefore, we have secured the option over these attractive assets, which have historically had significant exploration work performed on them and are located in a stable, mining-friendly region.
“For a relatively small outlay, we believe that a focused work programme, including geological and metallurgical reinterpretation, could significantly progress these exploration projects towards development readiness and diversify our project risk, while we continue to progress our flagship Moonlight project,” stated Revy.
Ferrum would make further announcements on the possible acquisition of GoldQuest, following the completion of a due diligence.