Dual-listed diamond explorer Botswana Diamonds and Aim-listed Vast Resources have signed a new agreement in respect of their proposed joint venture (JV) in the Chiadzwa Marange area, in Zimbabwe.
When the detailed agreement between Vast’s Katanga Mining subsidiary and Zimbabwe Consolidated Diamond Company becomes effective, Botswana Diamonds will be issued with new shares representing 2.5% of Katanga.
In consideration for the issue of the shares, Botswana Diamonds has agreed to provide Vast and Katanga its management know-how on exploration, mining, processing and marketing in relation to the Chiadzwa Community Diamond Concession, at no charge, for five years.
Vast will provide all capital requirements for the project start on a loan account to Katanga, up to a maximum of $10-million.
Botswana chairperson John Teeling on Thursday said Zimbabwe was “opening up to investment” and that the country “is rich in resources and has significant diamond potential”.
Vast CEO Andrew Prelea added that, as a result of the recent agreement with the Chiadzwa Community and the pre-agreed JV terms on the Chiadzwa Community Diamond Concession in the Marange diamondfields, the company was required to review its current agreement with Botswana Diamonds.
Vast then decided that it wished to continue its relationship with Botswana Diamonds as a consulting party that could “add significant value to the project.”
BACKGROUND
As previously announced in October 2018, Botswana Diamonds concluded an agreement with Vast for the development of Vast’s Heritage concessions in the Marange diamondfields, and that a separate agreement would cover the joint development of diamond properties outside of the Marange diamondfields.
Vast subsequently entered into a JV agreement with Chiadzwa Mineral Resources, a Zimbabwe company owned by the Chiadzwa Community Development Trust, in relation to an area of diamond prospectivity known as the Chiadzwa Community Diamond Concession within the Marange diamondfields, and established Katanga for the purpose of operating the Chiadzwa Community JV.
Katanga intends to conclude a JV agreement with Zimbabwe Consolidated Diamond Company for the purposes of exploring and mining at the Chiadzwa Community Diamond Concession and marketing the diamonds derived from the operation.
Owing to these changes in the area likely to be licensed by Vast, the new agreement replaces the Heritage concession agreement.