London-headquartered Marula Mining has entered into a binding heads of agreement with Tanzanian miner Kusini Gateway Industrial Park (KGIP) to secure a 73% commercial interest in the Bagamoyo graphite project, in Tanzania.
The project extends over 180 ha and comprises 22 granted graphite mining licences.
The licences are valid for seven years to August 2029 and are located in the Bagamoyo district in the Pwanai Region of the country, which is seeing increasing graphite mining and exploration activity.
The transaction is in line with Marula’s battery metals strategy and particularly for projects that have the potential to rapidly advance through to production.
In terms of the agreements, Marula will fund all the project’s exploration and development costs through to the start of commercial graphite mining and processing, starting with an initial exploration programme within three months across all 22 licences.
Marula will be targeting high-grade, jumbo and large flake graphite mineralisation, as part of the Phase 1 exploration programme. When this is complete, Marula will have the option to proceed with further exploration activities and feasibility studies on up to ten of the licences, as part of a Phase 2 programme.
This is subject to Marula paying KGIP $50 000 a licence, comprising 50% in cash and 50% through the issue of ordinary shares.
The Phase 2 programme requires a minimum expenditure of $500 000 over a ten-month period and completion of an economic study for the establishment of a commercial graphite mining and processing operation.
On completion of Phase 2, and if Marula decides to mine, it will make a final payment to KGIP of $100 000, equally through cash and shares.
Marula’s senior management and technical consultants will meet with KGIP in Dar es Salaam and on site in December, to discuss site activities starting in January.
“This agreement with KGIP is a great push towards supporting the global transition to clean energy and clearly outlines Marula’s growing position in the critical metals sector and our ambitions to build our business in Africa,” says Marula CEO Jason Brewer.
In turn, KGIP COO Saeed Cabdalla says Marula will bring a great deal of credibility to the East African region and the battery metals sector. The company intends to leverage Marula’s considerable experience and expertise throughout this collaboration, and advance a graphite project towards development.
Marula also has a binding heads of agreement in place with Takela Mining, in Tanzania, for a 49% commercial interest in the Kinusi copper project, which comprises ten granted copper mining licences.