JOHANNESBURG (miningweekly.com) – Aim-listed Bushveld Minerals has signed an agreement to acquire 87% of the Zaaiplaats tin tailings dump, in the Bushveld Complex, for a total consideration of up to R10-million, the company announced on Tuesday.

Currently the tailings dump, which was estimated to contain between 2 600 t and 4 500 t of tin, was 40% owned by Sephaku Tin, with the Brent Trust holding the remaining 60%.

"Having started a technical work programme on the Zaaiplaats dump, including a review of historical data and additional mineralogical and metallurgical testwork, we have begun to understand the potential of and derisk the asset.

“Its location in close proximity to and between the Groenfontein and the Zaaiplaats hard rock deposits, on which we already have a combined 18 477 t contained tin resource, gives Bushveld scope to add an early tailings-first production scenario to our Mokopane tin project, with the potential of materially enhancing the economics of the Mokopane tin scoping study,” Bushveld CEO Fortune Mojapelo said.

He added that the company had extended the timeline for the release of the Mokopane scoping study to allow it to evaluate and include the Zaaiplaats dump.

“This is in line with our stated strategy for Bushveld's tin platform to consolidate a critical mass of continued tin inventory while pursuing opportunities for early production," Mojapelo said.

The acquisition was conditional on the outcome of technical due diligence and evaluation of the Zaaiplaats dumps, to be undertaken by Bushveld over a two-month period, which started on March 20.

Meanwhile, Bushveld Minerals also on Tuesday announced that it had agreed to a new funding arrangement with capital provider Darwin Strategic, which would augment the company’s strong cash position over the next 12 months.

In terms of the agreement, Darwin has subscribed for 50-million ordinary shares in Bushveld of 1p each, representing 11% of the company’s issued share capital, at a price of 5.7p each. 

The aggregate issue price of £2.85-million was to be satisfied by the issue of 2.85-million redeemable subscription notes of £1 each by Darwin to Bushveld. 

The completion of the subscription was conditional upon the subscription shares being admitted to trading on Aim on or before April 1.

"We are pleased to agree [to] this highly flexible funding arrangement with Darwin, which will augment our strong cash position over the next 12 months. The terms of the redeemable subscription notes provide Bushveld ultimate control and flexibility in terms of the timing and amounts of the subscription notes redeemed.

“All redemptions are done at Bushveld's discretion, at market prices without applying historical weighted averages and discounts, with Bushveld retaining 100% economic interest in the shares. The terms enable the company to capitalise on high liquidity and share appreciation windows [through] an efficient capital-raising platform,” Mojapelo commented.