PERTH (miningweekly.com) – Copper and gold junior Celsius Resources has secured a local Philippines partner for the development of its Maalinao-Caigutan-Biyog (MCB) project.

The company on Wednesday said it had signed a non-binding term sheet with Sodor Inc. and PMR Holding Corp. to be the local partners for the development of the project, satisfying a requirement for securing a mineral production sharing agreement (MPSA) with the Philippine government in order to build the project.

Under the Philippine Mining Act, companies applying for the exploration, development, and utilisation of natural resources under an MPSA must be at least 60% Filipino-owned.

“We are very pleased to engage Sodor Inc. and PMR as our local partners for the development of the MCB project. We are excited by the combined investment proposed by Sodor Inc. and PMR as both are strongly positioned to leverage a proven successful track record of profitability, operational efficiency, developing a world-class workforce, and commitment to environmental, social and governance (ESG) principles in the energy industry into the successful development of MCB project and the renaissance of our country’s mining industry,” said Celsius chairperson Julito Sarmiento.

The non-binding agreement outlines a common goal of applying for an MPSA with the Philippine government.

The agreement proposes that Sodor purchase 30-million shares in Celsius subsidiary Makilala Mining Company (MMCI) for $8.75-million, out of the current 50-million outstanding shares, resulting in Sodor owning a 60% interest in the outstanding shares.

When the MCB project goes into operation MMCI will subcontract to Celsius’ other subsidiary PDEP to operate the processing plant and other ancillary equipment and assets, the ownership of which is not subject to nationality restrictions. PMR shall subscribe pro rata in such appropriate percentage of PDEP equity, so that PMR and Sodor Inc. will have a 30% economic share in the combined MMCI and PDEP operations.

In consideration for the PDEP share subscription, up to $34.25-million will be payable in tranches within a schedule to be mutually agreed by the parties.

The funds paid by Sodor Inc and PMR will be used to finance the MCB project, with an appropriate level of debt to be raised by all parties.

A previously completed scoping study into the MCB project estimated that it would require an initial investment of $253-million to support a 2.28-million-tonne-a-year processing plant. The project is expected to have a 25-year mine life, based on a mineral resource estimate of 313.8-million tonnes at 0.48% copper and 01.5 g/t gold for 1.5-million tonnes of contained copper and 1.47-million ounces of gold.