PERTH (miningweekly.com) – ASX-listed POZ Minerals has executed an option agreement over its Musgraves vanadium project, in Western Australia.
The option agreement granted the buyer a three-month exclusive right to purchase the project for A$120 000 in cash and a 1% net smelter royalty on any minerals produced from the tenement.
A non-refundable option fee of A$30 000 has been paid to POZ, the company said on Thursday.
The buyer could extend the option by a further three months for an additional A$30 000 prior to the end of the option period, and should the buyer exercise the option prior to the extension of the offer period, a further A$30 000 was payable.
If the buyer were to conduct an initial public offering, or sell the tenement to a listed company, a further A$30 000 would be payable to POZ in the form of shares in the listed entity.
POZ executive chairperson Jim Richards said on Thursday that the Musgraves transaction was a good way for POZ to add value to the company while maintaining its focus on the Blinda diamond project, in Western Australia.
“The retained 1% net smelter royalty from the Musgrave tenement could prove extremely valuable should the project move to production, as vanadium is a critical metal part of the lithium-ion battery supply chain.”
While POZ has not conducted any fieldwork on the tenement area, the project is considered highly prospective for vanadium, based on previous rock chip sampling.