Last checked at 23 Sep 2016 07:45
Kibo Mining Plc (Incorporated in Ireland)
(Registration Number: 451931)
(External registration number: 2011/007371/10)
Share code on the JSE Limited: KBO
Share code on the AIM: KIBO ISIN:IE00B97C0C31
("Kibo" or "the Company")
23 September 2016
Kibo Signs Heads of Agreement with Opera Investments PLC to vend its Imweru and Lubando Gold Projects into Opera via RTO
Kibo Mining plc ("Kibo" or the "Company") (AIM: KIBO; AltX: KBO), the Tanzania focused mineral exploration and development Company is pleased to announce that it has signed a Heads of Agreement (the "HoA") with LSE Main Market listed Opera Investment PLC ("Opera") (Kibo and Opera together the "parties") for the sale of the entire share capital of its wholly owned UK subsidiary, Sloane Developments Ltd (the "Proposed Transaction").
The HoA provides for the following to occur contemporaneously or immediately after the Transaction:
· Subject to commercial, technical and legal due diligence, the consideration to acquire the Imweru and Lubando gold projects will be satisfied by the allotment and issue to Kibo on completion of the Proposed Transaction of 61,000,000 ordinary shares of one pence each in the capital of Opera at a price of 6 pence per ordinary share immediately following completion of the Proposed Transaction (and completion of the fundraising by Opera referred to below) (Consideration Shares).
· As part of the Proposed Transaction, Opera and Kibo have agreed that there will be a fundraising by way of the issue of new ordinary shares in Opera at a price of 6 pence per ordinary share (the Placing Shares). The Proposed Transaction will be subject to a minimum fundraising of £1,200,000 before expenses.
· As part of the Proposed Transaction, Opera will delist from the Main Market of the London stock Exchange and the enlarged share capital of Opera following Completion will contemporaneously seek admission to the AIM Market of the London Stock Exchange (AIM).
· On completion of the Proposed Transaction it is proposed that Opera will be renamed Katoro Gold Mining plc.
· The Board of Directors following completion of the Proposed Transaction will initially comprise 3 directors nominated by Kibo and 2 directors nominated by Opera.
The Proposed Transaction is subject to a number of conditions, including:
· Each of the parties conducting, and being satisfied with the results of, legal, financial, taxation, geological, technical and commercial due diligence concerning the assets and liabilities of Sloane Developments Ltd and Opera.
· The parties agreeing, signing and exchanging a detailed and legally binding purchase agreement incorporating all the terms of the Proposed Transaction.
· The prompt publication by Opera of an admission document (relating to Opera and its proposed acquisition of the Imweru and Lubando gold projects), the completion of a Competent Person's Report by Kibo on the Imweru and Lubando gold projects and the admission of the enlarged share capital of Opera to the AIM Market of the London Stock Exchange (being the existing Opera shares, the Consideration and the Placing Shares).
· The Takeover Panel waiving, subject to a vote of independent shareholders, any obligation Kibo might otherwise incur under Rule 9 of the City Code by virtue of its receipt of the Consideration Shares.
· The approval of the Proposed Transaction and passing of associated resolutions (including as to the allotment and issue of the Consideration Shares and a Rule 9 "whitewash") by the shareholders of Opera at a duly-convened general meeting.
· The Consideration Shares will be subject to the AIM Rule lock-in for non-revenue generation companies (AIM Rule 7) and therefore not able to be disposed of for 1 year.
· Kibo will be subject to a relationship agreement, the terms of which are to be determined on the same basis as reasonable and normal market normal conventions.
The Transaction will no longer include the originally envisaged Imwelo project from LVG (See RNS dated 10 August 2016) due to the fact that the latter was not able to meet some of the conditions precedent as called for under the agreement, by which Sloane Developments LTD was to acquire 100% of Tanzoz Minerals LTD.
The gold projects for the new AIM listed company will now comprise, in addition to our flagship Imweru project, our Geita East projects (Lubando, Pamba & Busolwa projects). Geita East contains the Lubando project (located approximately 70 km east of Imweru) and has a NI 43-101 compliant Mineral Resource of 2,593,710 tonnes at 2 g/t, 0.5 g/t cut-off (168,300 oz. gold). Taken together Imweru and Lubando have a total mineral inventory in the region of 700,000 oz. gold at 1-2 g/t and what the Company believes is a significant resource.
As previously announced, the immediate priority post transaction will be to expedite mine development on its Imweru gold project (contains JORC-compliant Mineral Resource of 14.9 Mt @ 1.1 g/t, 0.4 g/t cut-off (550,000 oz. Au) on which a Definitive Feasibility Study has already commenced. The Company has an initial production target of circa 50,000 oz p/a at Imweru, to be ramped up to 100,000 oz p/a, contingent on resource expansion, where the objective is to achieve a > 1 Mil oz resource.
Louis Coetzee, CEO of Kibo Mining, said: "We believe the above agreement provides us with the most cost effective and quickest path towards realizing value in our Northern Tanzania gold portfolio and in particular our Imweru gold project. Kibo now finds itself in a position where the development of both the Company's advanced gold projects will be fast tracked with the strategic advantage of an independent ability and capability to fund further development into production.
It remains our objective to complete a definitive feasibility study on Imweru and obtain a mining right for Imweru by Q3 2017, followed by a process of securing and finalizing funding for the construction of a gold mine at Imweru, with mine commissioning to commence at the start Q2 / 3 of 2018.
The Imweru / Lubando transaction with Opera provides Kibo with an excellent opportunity to realize significant value for its shareholders from the Company's gold assets and puts Kibo in a very strong position to ensure the expedited and focused development of the Imweru and Lubando gold projects."
Contacts
Louis Coetzee |
+27 (0) 83 2606126 |
Kibo Mining plc |
Chief Executive Officer |
Andreas Lianos |
+27 (0) 83 4408365 |
River Group | Corporate Adviser and Designated Adviser on JSE |
Jon Belliss |
+44 (0) 207 382 8300 | Beaufort Securities Limited |
Broker |
Oliver Morse |
+61 8 9480 2500 | RFC Ambrian Limited |
Nominated Adviser on AIM |
Daniel Thöle / Anna Legge |
+44 (0) 203 772 2500 |
Bell Pottinger |
Investor and Media Relations |
Kibo Mining - Notes to editors
Kibo Mining is listed on the AIM market in London and the AltX in Johannesburg. The Company is focused on exploration and development of mineral projects in Tanzania, and controls one of Tanzania's largest mineral right portfolios. Tanzania provides a secure and stable operating environment for the mineral resource industry and Kibo Mining therein.
Kibo Mining holds a thermal coal deposit at Mbeya, which has a significant NI 43-101 compliant defined resource, and is developing a 300 MW mouth-of-mine thermal power station, the Mbeya Coal to Power Project ("MCPP"), previously called Rukwa Coal to Power Project ("RCPP"), with an established management team that includes Standard Bank as Financial Advisor. Kibo is undertaking a Coal Mining Definitive Feasibility Study and a Power Pre- Feasibility Study for the Mbeya project with an integrated Bankable Feasibility Study report for the MCPP to be released in the near term. On 25 August 2016, Kibo signed an Agreement with China based EPC contractor SEPCO III granting it the right to become the sole bidder for the EPC contract to build the power plant component of the MCPP in exchange for SEPCO III refunding 50% of the development costs incurred by Kibo to date on the project. Kibo has already received the first tranche of this funding in the amount of US$1.8 million on the 5th September 2016
The Company also has extensive gold focused interests including Lake Victoria Goldfields and Morogoro projects. At Lake Victoria, the Company has 100% owned projects with a 550,000 oz. JORC compliant gold Mineral Resource at the Imweru Project and a 168,000 oz. NI 43-101 compliant gold Mineral Resource at the Lubando Project (refer Mineral Resource tables below). The Company is currently undertaking a Definitive Feasibility Study on its Imweru Project.
Kibo also holds the Haneti Project on which the latest technical report confirms prospectivity for nickel, PGMs, gold and strategic metals including lithium.
Kibo Mining further holds the Pinewood (coal & uranium) project where the company has entered into a 50/50 Exploration Joint Venture with Metal Tiger plc.
Finally, the Company also holds the Morogoro (gold) project where the company has also entered into a 50/50 Exploration Joint Venture with Metal Tiger plc.
The Company's projects are located in the established and gold prolific Lake Victoria Goldfields, the emerging goldfields of eastern Tanzania and the Mtwara Corridor in southern Tanzania where the Government has prioritized infrastructural development attracting significant recent investment in coal and uranium. The Company has a positive working relationship with the Tanzanian government at local, regional and national levels and works hard to maintain positive relationships with all communities where company interests are held. The Company recognizes the potential to enhance the quality of life and opportunity for Tanzanian citizens through careful development of its projects.
Updates on the Company's activities are regularly posted on its website www.kibomining.com
Mineral Resources
Imweru Mineral Resource
Table 2 below presents a table showing the Mineral Resource estimate for the Imweru Project at a base case economic cut-off grade for the reporting of the resource of 0.4 g/t. The table is taken from a JORC-Compliant Report by Tetra Tech EBA dated February 2014.
Table 2
Area | Material Type |
Classification | Cut- off (g/t) | Specific Gravity | Metric Tonnes (t) |
Short Tons | Gold Grade (g/t) | Contained Gold Ounces (troy) |
Central | Laterite | Indicated | 0.40 | 2.50 | 131,000 | 144,000 | 1.785 | 8,000 |
Saprolite | Indicated | 0.40 | 2.50 | 706,000 | 778,000 | 1.387 | 32,000 | |
Bedrock | Indicated | 0.40 | 2.89 | 1,895,000 | 2,089,000 | 1.043 | 64,000 | |
Total | Indicated | 0.40 | 2.77 | 2,732,000 | 3,012,000 | 1.168 | 103,000 | |
Central |
| |||||||
Laterite | Inferred | 0.40 | 2.50 | 685,000 | 755,000 | 1.317 | 29,000 | |
Saprolite | Inferred | 0.40 | 2.50 | 1,047,000 | 1,154,000 | 1.040 | 35,000 | |
Bedrock | Inferred | 0.40 | 2.89 | 7,838,000 | 8,640,000 | 1.029 | 259,000 | |
Total | Inferred | 0.40 | 2.82 | 9,569,000 | 10,548,000 | 1.051 | 323,000 | |
| ||||||||
East | Total | Inferred | 0.40 | 2.70 | 2,653,000 | 2,925,000 | 1.449 | 124,000 |
| ||||||||
Imweru Property Total | Indicated | 0.4 | 2.77 | 2,732,000 | 3,012,000 | 1.168 | 103,000 | |
Inferred | 0.4 | 2.79 | 12,222,000 | 13,473,000 | 1.137 | 447,000 | ||
Combined (inf+ind) | 0.4 | 2.79 | 14,954,000 | 16,485,000 | 1.143 | 550,000 | ||
*Kibo holds 100% of the Imweru Mineral Resource subject to 2% Net Smelter Royalty
* Total estimates are rounded, based on composites capped at 26 g/t gold at Imweru Central and 25 g/t at Imweru East, the cut-off grade is based on a gold price of US$1,200 and a 90% metallurgical recovery is assumed in calculation of cut-off grade. A base case of 0.40 g/t has been selected.
** Classification of Mineral Resources incorporates the terms and definitions from the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code) published by the Joint Ore Reserve Committee (JORC)
Lubando Mineral Resource
Table 3 below presents a table showing the Mineral Resource estimate for the Lubando Project at a base case economic cut-off grade for the reporting of the resource of 0.5 g/t Au. The table is taken from an NI 43 101-Compliant Report by EBA Engineering Consultants Limited (now part Tetra Tech EBA) dated August 2009.
TABLE3: LUBANDO MINERALRESOURCE SUMMARY - BASECASE* | |||||
Category |
West Zone |
East Zone South |
East Zone Mid |
East Zone North |
Total |
Measured Resource |
|
|
|
|
|
Measured Resource(t) | 107,900 | 4,880 | 16,900 | 54,440 | 184,150 |
Grade(g/t) | 1.69 | 2.52 | 1.72 | 2.48 | 1.95 |
Total Gold(oz) | 5,900 | 400 | 950 | 4,340 | 11,500 |
Indicated Resource |
|
|
|
|
|
Indicated Resource(t) | 280,710 | 18,330 | 61,000 | 149,350 | 509,420 |
Grade(g/t) | 1.61 | 2.23 | 1.89 | 2.73 | 1.99 |
Total Gold(oz) | 14,500 | 1,300 | 3,700 | 13,120 | 32,600 |
Inferred Resource |
|
|
|
|
|
Total Resource(t) | 1,090,000 | 65,470 | 209,340 | 535,330 | 1,900,140 |
Grade(g/t) | 1.27 | 1.56 | 3.34 | 3.13 | 2.03 |
Total Gold(oz) | 44,550 | 3,300 | 22,500 | 53,900 | 124,200 |
*Kibo holds 100 % of the Lubando Mineral Resource subject to a 2% Net Smelter Royalty
* Numbers are rounded. Composites capped at 10.85g/t gold. Cut-off grade of 0.5 g/t gold based on a gold price of US$850/oz and assumed 100% metallurgical recovery .CIM definitions were followed for Mineral Resources.
Pursuant to the terms of a Net Smelter Agreement (refer Kibo RNS of the 22 July 2016) Acacia Mining plc has a 2% Net Smelter Royalty interest in the Imweru and Lubando Mineral Resources.
Review by Qualified Persons
The information in this announcement that relates to the Imweru Mineral Resource is taken from the report titled "Resource Update for the Imweru Property Geita Region Northern, Tanzania, JORC Competent Persons Report" dated February 17th 2014 (the "Report"). The Report states a JORC-compliant Mineral Resource estimate and was prepared for Kibo Mining plc by James Barr P.Geo. and Darryn Hitchcock P.Geo. Senior Geologist and Geologist respectively with TetraTech EBA Ltd. Both Mr. Barr and Mr. Hitchcock are registered as Certified Professional Geologists with Association of Professional Engineers and Geoscientists of British Columbia a recognised professional organisation. Mr Barr as principal author responsible for the Report has experience in the evaluation and reporting of Archaean Gold projects and is a "Qualified Person" for reporting gold resources to the JORC Standard. He consents to the inclusion in this document of the matters based on his information in the form and context in which they appear.
The information in this announcement that relates to the Lubando Mineral Resources is taken from a report titled "Technical Report on the Lubando property, Mwanza, Tanzania" dated 31st August 2009" (the "Report") The Report is NI 43-101 compliant and was prepared for Great Basin Gold Rusaf Gold Limited by Nathan Eric Fier C.P.G., P.Eng. Market Director for EBA Engineering Consultants Ltd and a Senior Mining Consultant. Mr. Fier is registered as a Certified Professional Geologist with the American Institute of Professional Geologists, Registration No 10062, and a professional Engineer in British Columbia, Canada Registration No. 135165. He has extensive experience in the evaluation and reporting of Archaean Gold projects.
The Company's Exploration Director, Noel O'Keeffe has reviewed the content of this announcement including Mineral Resource estimates and the references to them.
Johannesburg
23 September 2016
Corporate and Designated Adviser
River Group