(Alliance News) - Orosur Mining Inc on Tuesday said talks with Minera Monte Aguila over a potential joint venture for Orosur's flagship Anza project in Colombia are progressing.
The South America-focused minerals exploration and development company said the negotiations were regarding the completion of the Mining Company Constituents documents with Minera, a Medellin, Colombia-based company operating in the mining and metals sector.
Orosur said Minera has agreed to make a USD2 million phase 2 payment contemplated by the exploration agreement to Orosur, in advance of finalising the Mining Company Constituents Documents. The funds are expected to be received soon.
Further, the process of forming a new joint-venture company is underway, according to Orosur. It will hold a 49% stake, whereas Minera's will hold a 51% interest.
After the formation of the mining company and entering into the Mining Company Constituents Documents, Minera may also earn an additional 14% ownership if it has spent USD20 million in qualifying exploration expenditures on the project on or prior to the fourth anniversary of the parties entering the Mining Company Constituents Documents.
If this phase 2 earn-in is completed, Minera would own 65% of the joint-venture mining company to Orosur's remaining 35%, Orosur said.
"We are pleased that Minera will be advancing to phase 2 of the project and that the USD2 million will be paid soon. Both actions support the company's continued belief in the strength and potential of the project," said Orosur Executive Chair Louis Castro.
Shares in Orosur closed down 2.5% to 8.58 pence each in London on Tuesday.
By Greg Rosenvinge, Alliance News reporter
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