PERTH (miningweekly.com) – ASX-listed Cape Lambert has inked a joint venture (JV) agreement with Congolese company Paragon Mining to develop the Kipushi cobalt-copper tailings project, the Kasombo copper-cobalt project and operate the Kipushi processing plant, in the Democratic Republic of Congo (DRC).
The JV will operate the fully constructed and commissioned Kipushi processing plant to process the Kipushi tailings and treat additional hard rock cobalt and copper material.
The processing plant, which was commissioned last year, has a one-million-tonne-a-year flotation plant designed to produce 4 000 t/y of cobalt, 10 000 t/y of copper and 2 000 t/y of zinc in concentrate from the tailings material.
“Cape Lambert has built a successful record of identifying commodities and projects at the right time. By applying our technical and marketing support, we can add immediate value to these projects and return significant value to the company, its shareholders and all stakeholders,” said Cape Lambert executive chairperson Tony Sage.
“We believe cobalt, as a commodity, has an extremely positive future and with this transaction and the proposed JV, we believe we are well placed to benefit from significant demand and price increases in this commodity sector.”
Under the terms of the JV agreement with Paragon, the two companies will each hold a 50% interest in the JV, and will aim to start mining activities at Kipushi within the next six months, and to immediately start exploration activities at Kasombo.
A feasibility study for Kasombo was scheduled within the next 18 months, and mining activities within the next 24 months.
The JV partners will also work to identify and secure other copper, tin, zinc and cobalt projects in the DRC and Zambia.
At Kipushi, Cape Lambert will be responsible for providing all the necessary technical resources to enable exploration and mining, and will fund 100% of the working capital and capital costs to start mining, while also sole funding any requirements to upgrade the processing plant.
At Kasombo, Cape Lambert will be responsible for sole funding the costs of exploration and feasibility studies to start mining and, if necessary, upgrade the Kipushi processing plant to process ore from Kasombo. Cape Lambert will also provide all the necessary technical resources to enable exploration and mining activities at the project.
Further, Cape Lambert will also pay the vendors $50 000 on the execution of a binding heads of agreement and a further $100 000 and 90-million shares on the execution of a JV agreement.
A further payment of $150 000 and 50-million shares will be made on the achievement of first production at any of the projects, with the company also granting a 1% royalty on all revenue received from the project.