(Alliance News) - AEX Gold Inc on Friday said it has signed an agreement to create a joint venture with ACAM LP to explore and develop its southern Greenland project.
Shares in the Greenland-focused gold mining company were up 5.4% to 46.39 pence each in London on Friday morning.
AEX Gold said that it has signed a non-binding heads of terms with ACAM to establish a special purpose vehicle and create a joint venture for the exploration and development of its strategic mineral assets for a combined contribution of GBP36.7 million.
Jersey-based natural resource focused company ACAM will initially invest GBP18 million in exchange for a 49% shareholding in the joint venture. This funding will go directly to the special purpose vehicle and will aid in progressing the exploration for and identification of strategic minerals across a number of AEX's existing gold targets.
AEX will retain a 51% stake in the project. In return, the company is expected to contribute its strategic non-precious mineral licences and a contribution valued at GBP18.7 million in the form of site support, logistics, and overhead costs associated with utilising its existing infrastructure in southern Greenland.
AEX said that all its gold assets are excluded from the joint venture and will remain 100% owned by the company.
The company added that a future funding option of GBP10.0 million is available dependent on performance. This funding will not increase ACAM's interest over 49%.
Chief Executive Eldur Olafsson said: "We are delighted to announce our planned partnership with ACAM LP specifically for the funding of our non-precious metal strategic mineral assets across our licence areas."
"This JV will enable us to invest the capital required to bring these strategic mineral targets up the value curve towards future production and also enable us to explore the wider area to identify further non-precious strategic mineral assets," he added.
By Sophie Rose; sophierose@alliancenews.com
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