Aim-listed Katoro Gold and Power Metal Resources (POW) will continue to monitor the development of any potential commercial transactions, before any final agreement is agreed upon in terms of commercial discussions relating to the Haneti polymetallic project, in Tanzania.
In lieu of this, POW has the option to extend its holding in the project to August 31, which will allow both parties the benefit of further discussions and to carefully consider all available options based on additional information.
The update comes as Katoro has received approaches in recent months with a view to earn-in, joint venture, or other similar structures, in respect of the project, with a primary focus on the nickel sulphide potential.
According to the company, it is apparent that, to crystallise the interest shown in a potential commercial transaction, it is preferable, and possibly a requirement, for Katoro and POW to restructure ownership of the project.
The extra time afforded by this extension gives both parties the opportunity to give due consideration to the interest of all stakeholders and to reach a suitable agreement in a controlled manner, says Katoro executive chairperson Louis Coetzee.
“Given the external interest shown in Haneti, both Katoro and POW are willing and able to accelerate discussions should this become necessary.”
BACKGROUND
On March 15, 2019, Katoro announced an investment and option agreement whereby POW (formerly African Battery Metals) could acquire up to a 35% interest in the Haneti project.
After due diligence, POW acquired a 25% interest in the project two months later, on May 15, and held an option to acquire a further 10% through a payment to Katoro of £25 000 by May 15, this year, with the option period subsequently extended to May 31, as announced on May 15.