Some parties' interest going beyond Verkhuba4 Jul 2024 10:54
Just a reminder
From Alex to shareholders from ADFN board
While I want to be careful to state that East Star has not started any commercial negotiations with BHP, past being in the 2024 Xplor programme, I would like to draw your attention to what we feel is a fantastic deal signed between BHP and ASX listed, Kingsrose Mining, who were one of the recipients of the 2023 Xplor programme. Attached is a copy of the announcement with the highlights below. My key takeaways are the following:
Non dilutionary funding for up to 4 years is a significant amount of exploration
The deal structure allows a junior Company to approach targets which would otherwise be much more difficult from a risk/reward perspective due to exploration and development scale
US$36m on any individual target should be more than enough to establish a ‘BHP sized’ resource and initial feasibility study to provide a transparent project valuation
Having a large area of interest provides both BHP and Kingsrose the flexibility to test new geological concepts in underexplored mineral belts
We’re really excited about this field season and any corporate action as a result of our work to date. I look forward to updating you all in the not too distant future on our progress.
Kind Regards,
Alex
Kingsrose Deal Summary:
Project Generation Phase: BHP to sole fund up to US$20 million (A$31 million*) in regional generative exploration over up to 4 years across belt scale areas of interest in Norway and Finland for the exclusive right to select targets to become Defined Projects.
Earn-In Phase: In respect of each Defined Project, BHP may earn up to 75% in two stages by sole funding a further up to US$36 million (A$56 million) over 7 years from commencement of the Earn-in Phase.
Joint Venture Phase: Thereafter, subject to BHP exercising the option to establish a joint venture, the parties shall fund joint venture activities on a pro-rata basis. If either Party's interest in a joint venture dilutes below 10%, their interest in the Joint Venture shall be converted to a 2% net-smelter royalty
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