Aim-listed Katoro Gold has transferred the initial tranche of R5-million, or £263 000, to Blyvoor Gold as part of plans to form a joint venture (JV) that will exploit six tailings deposits, in South Africa.
The initial tranche allows the partners to accelerate work on the confirmatory test to optimise the financial projections and conceptual designs for the processing plant as Katoro seeks to secure the requisite funding for the project.
Katoro earlier this month entered into a binding conditional agreement to work with Blyvoor and its holding company Target Mine Consulting on reprocessing an existing 1.34-million-ounce gold tailings resource.
The project already has a mining licence and environmental-impact assessment in place for the reprocessing of the tailings.
The companies plan to produce about 35 000 oz/y of gold over a 35-year mine life. The all-in sustaining costs are anticipated to be about $664/oz for the first five years of production.
Meanwhile, Katoro has raised a £397 000 convertible loan note with a number of clients of SI Capital, the company’s broker, to support its commitments under the agreement. Katoro is due to provide R15-million, or £790 000, to the JV.
Katoro has also put in place a facility with Sanderson Capital Partners, in which it may subscribe for up to £400 000 in the form of a convertible loan.