PERTH (miningweekly.com) – ASX-listed Pilbara Minerals has finalised agreements to gain full ownership of the Tabba Tabba tantalum project, in Western Australia, as the project readies for production.
Pilbara Minerals on Thursday announced that it would acquire joint venture partner Valdrew Nominee’s 50% stake in the project for A$2-million in cash.
All loans and advances, as well as any amounts due to Valedrew would also be released in full and would not be enforceable, while a further A$1.3-million would be payable to Valdrew on the delivery of tantalite concentrate to Global Advanced Metals Wodgina (GAM), in accordance with an existing minerals and processing agreement.
Valdrew would also continue to provide services for the management and operation of the Tabba Tabba process plant and ancillary facilities on agreed commercial rates.
In addition, Valdrew could receive up to 20-million unlisted incentive options in Pilbara Minerals, with the incentive options issued on the reaching of certain milestones, including the commissioning of the processing plant and binding mining and processing agreements over GAM’s Strelley project.
Pilbara Minerals executive director Neil Biddle said the transaction was a positive development for the company and came on the eve of the start of commercial production at Tabba Tabba.
“This acquisition will be earnings-accretive for Pilbara, giving us access to 100% of the valuable cash flows to be generated by this high-value deposit and providing a strong foundation for our broader growth strategy.”
A 2014 feasibility study estimated that the Tabba Tabba project could produce about 365 000 lb of tantalum over a 19-month mine life. Development would require a capital investment of A$3.9-million.
Meanwhile, Pilbara Minerals this week also updated the mineral resource at its Pilgangoora lithium-tantalum project, in Western Australia, which was now estimated to have an indicated and inferred resource of 52.2-million tonnes, grading 1.28% spodumene for 668 000 t of lithium oxide and 32.9-million tonnes, grading 0.022% tantalum for 15.7-million pounds of tantalum.
The most recent resource estimate indicated a 182% increase in contained lithium oxide and a 39% increase in contained tantalite, and was based on information from 125 drill holes conducted between May and August.
The next phase of resource extension drilling at Pilgangaroo started in late August and was focused on the southern domains and the Monster prospects outside of the currently defined mineral resource.
Drilling in these zones were expected to result in further significant increases in the resource inventory at Pilgangaroo.