TIDMPAT
RNS Number : 7179J
Panthera Resources PLC
25 August 2021
25 August 2021
Panthera Resources Plc
("Panthera" or "the Company")
US$18 million Labola Funding
Panthera Resources Plc (AIM: PAT), the diversified gold
exploration and development company with assets in West Africa and
India, is pleased to announce that it has entered into definitive
agreements to restructure its ownership interests in Moydow
Holdings Limited ("Moydow") and underlying assets (together the
"Proposed Transaction"). Importantly, the Proposed Transaction will
provide funding to the Labola Project of up to US$18 million.
Highlights
-- US$18 million farm-out agreement secured on Labola Project
with Diamond Fields Resources Inc ("DFR")
-- Spin-out of Kalaka and Nigeria projects from Moydow into a new entity ("Maniger")
-- Panthera secures 50% interest and operatorship of Maniger
-- Minimising dilution to Panthera's wider asset portfolio
Commenting on the funding, Mark Bolton, Managing Director of
Panthera said:
"Panthera continues to focus on both progressing its projects
whilst also managing its own - and its investors' - financial and
risk exposure to those assets. Since partnering with Moydow last
year, the Labola project has progressed rapidly, and we remain
enthusiastic about its outlook.
The Proposed Transaction with DFR provides significant finance
to progress the Labola Project to the next stage, primarily the
bankable feasibility study. Panthera's significant ongoing interest
in Labola of up to 30% ensures that the Company will benefit from
any success, while not diluting shareholders' exposure to the
Company's other assets including Bassala, Bido and India. The 'spin
out' of the Kalaka and Nigeria projects preserves our interest
independent of Labola.
In summary, the DFR transaction secures significant multi-year
financing for Labola, ameliorates potential concentration of risk
and maximises shareholder exposure to the growth opportunity from
our wider asset portfolio. "
Proposed Transaction
Overview
Following the completion of the transaction:
-- DFR will acquire all of the shares and options in Moydow not
held by Panthera. Accordingly, DFR will own an 80% equity interest
in Moydow with the remaining equity interest held by Panthera; it
is a condition that DFR spend US$18 million in exploration and
development activities in order to maintain its equity interest in
Moydow at 80%.
-- Panthera has been granted a 'Back-In' right to acquire a 10%
interest in Moydow for US$7.2 million increasing its ownership in
Moydow to 30%. The Back-In right is exercisable on the earlier of
US$18 million in expenditure by DFR or 5 years.
-- The Kalaka and Nigerian projects will be spun out of Moydow
into a new company, Maniger Limited, which will be 50% jointly
owned by Panthera and DFR.
-- DFR will be the operator of Moydow and Panthera will be the operator of Maniger.
Implementation Agreement
DFR and Panthera have entered into an implementation agreement
(the "Implementation Agreement") under which both parties, subject
to conditions described below, have agreed to carry out the steps
required to implement the Proposed Transaction.
Share Exchange Agreements
DFR and Mr Brian Kiernan have entered into a share exchange
agreement (the "Kiernan Exchange Agreement") by which Mr Kiernan
has agreed, subject to conditions, to sell to DFR all ordinary
shares of Moydow held by Mr Kiernan in exchange for common shares
of DFR based on one common share of Moydow for 16.46 common shares
of DFR (the "Exchange Ratio"). DFR has entered into share exchange
agreements with several other minority Moydow shareholders and
option holders to exchange their shares and options in Moydow for
DFR shares.
Spin-Out Agreement
Moydow and Panthera have also entered into a share exchange
agreement (the "Panthera Exchange Agreement") by which, subject to
conditions, Moydow will acquire certain of the ordinary shares in
Moydow held by Panthera in exchange for a 50% equity interest in
Maniger, which will own all of Moydow's interests in the Kalaka and
Nigerian Projects.
Grant of Warrants
Moydow has issued 210,000 warrants including 70,000 warrants
each to Panthera and Mr Brian Kiernan. Each warrant is convertible
to one Moydow ordinary share for US$3.50 per warrant on or before
31 December 2021. Moydow shares issued upon conversion of the
warrants shall be automatically exchanged for commons shares in
DFR.
Transaction Approvals and Timeline
Under the terms of the Implementation Agreement, the closing of
the Proposed Transaction is subject to several conditions including
the approval of the Transaction by the TSX Venture Exchange (the
"TSX-V"), any DFR shareholder approvals required by the TSX-V
(including shareholder approval of Brian Kiernan as a new "control
person'" of DFR under the rules of the TSX-V) and satisfactory
confirmatory due diligence by DFR in respect of certain tax and
regulatory matters. It is anticipated that the approval of Brian
Kiernan as a "control person" can be obtained by the written
consent of at least 51% of the shareholders of DFR without the need
for a shareholder meeting.
Under the rules and policies of the TSX-V and applicable
Canadian securities laws, DFR will prepare and file on SEDAR a
technical report in respect of the Labola project in accordance
with NI 43-101. Should a shareholder meeting be required by the
TSX-V to approve the Proposed Transaction, it is anticipated that
such a shareholder meeting will be held in September 2021 with a
closing of the Proposed Transaction as soon as possible
thereafter.
Overview of Diamond Fields Resources Inc
DFR is a resources focused company listed on the TSX-V. Mr Jean
Raymond Boulle, an internationally renowned mining entrepreneur and
investor, currently holds an approximate 78% interest in DFR.
Upon completion of the Proposed Transaction, Brian Kiernan and
Jean Raymond Boulle will invest, in the aggregate, US$2.75m in DFR
(or its affiliates).
Mr Kiernan will be appointed Chairman of the DFR Board of
Directors.
Overview of Moydow Holdings Limited
Moydow is a privately owned, BVI registered, West African
focused gold exploration business, which was formed in 2019 to
acquire an interest in the Paimasa and Dagma gold projects in
Nigeria. Moydow subsequently acquired from Panthera its interests
in the Labola (Burkina Faso) and Kalaka (Mali) projects in 2020 and
2021 respectively. Panthera currently holds a 45.8% undiluted
equity interest and a 39.74% diluted equity interest in Moydow.
Labola Project (Burkina Faso)
The Labola (Wuo Land) gold project is located in southern
Burkina Faso, approximately 380km southwest of the capital city
Ouagadougou. The area is located within the Banfora Greenstone
Belt, comprised dominantly of Birimian aged metasediments with
lesser metavolcanic and felsic intrusions. It contains numerous
artisanal workings over at least 15,000m strike within the tenement
area. These workings are targeting high-grade shoots within
individual quartz veins that are located within an extensive zone
of shearing, sheeted to stockwork quartz veining and
silica-sulphide alteration.
Previous explorers have completed 65,556m RAB/RC/DD drilling in
541 drill holes. That work has outlined numerous extensive zones of
gold mineralisation over the entire 9km of strike tested so far.
This mineralisation has been wireframed by previous explorers.
Mineral resources have been estimated by previous explorers within
these wireframes, but they cannot be reported under JORC or
NI43-101 guidelines at this stage, largely due to their historical
nature. Some of the previous drilling is quite broad spaced and,
although gold mineralisation has been intersected, additional
drilling is required to firm up the mineralisation outlines.
Work undertaken by Panthera and Moydow has shown that excellent
potential exists to convert the historical resource estimates to a
maiden resource estimate by Moydow under JORC or NI43-101
guidelines. A drilling programme was commenced by Moydow in May
2021 to confirm the historic database and support Moydow's efforts
to prepare a maiden resource estimate. The programme includes twin
drilling of both previous explorers' drillholes designed to confirm
the location and gold grades of the mineralised intersections to
increase confidence in the historical data.
In addition to the confirmatory drilling, a 350-metre gap in the
previous drilling has been selected for infill drill testing
designed to test this area for additional resource ounces. This
area has associated artisanal mining activity and IP chargeability
and resistivity anomalies.
Due to the presence of coarse gold in some of the mineralised
quartz veins, samples of mineralisation from the twin drilling are
being assayed using an accelerated cyanide leach technique
(LeachWELL) of a large 2-3kg sub-sample as well as conventional
fire assay.
As the mineralisation is being confirmed as being in the correct
location and having the correct grades (within expected error
limits), it is anticipated that a resource estimate under JORC or
NI43-101 guidelines will be prepared once all results are to
hand.
Follow-up drilling is planned once results of the current
programme have been received, compiled and assessed. This will be
designed to increase the overall resource size and will include
testing of the high priority targets noted above.
Moydow currently holds an option to purchase 100% of the
existing licence holder's interest in the Labola (Wuo Land)
exploration licence through the payment of US$1.0m. An additional
payment of US$1.0m is required to be made to the licence holder
upon the successful definition and reporting of a resource of at
least 1,000,000 ounces of gold (under JORC guidelines). The licence
holder will retain a 1% net smelter return royalty ("NSR") on all
gold produced up to a total aggregate payment cap of US$2.0m. This
royalty is in addition to a 1% NSR owing to the previous explorer
Nordgold which has a total aggregate payment cap of US$3.0m.
Kalaka Project (Mali)
A significant amount of previous work has been undertaken by
other explorers including soils over the entire tenement area
(7,349 samples), airborne geophysics (909 line-km magnetics and
EM), ground IP and 20,952m drilling (RAB/AC/RC/DD) in 372
holes.
This work has identified four sub-parallel zones of gold
mineralisation with an interpreted combined strike of approximately
47km based on geochemistry, drilling and geophysics.
Within these zones, the most advanced target is the K1A prospect
which consists of sheared and altered (silica, sulphide, biotite)
granodiorite dykes and metasediments. The main K1A mineralisation
is over 750m long, 150-200m wide, and over 200m deep (open at
depth) and averages around 0.5g/t Au. Significant drill intercepts
include:
-- 249.3m @ 0.54g/t Au from 52m (to end of hole) including 8m @ 3.17g/t Au from 107m
-- 191.8m @ 0.52g/t Au (to end of hole) including 6m @1.47g/t Au and 4m @ 2.47g/t Au
-- 176.4m @ 0.49g/t Au from 24m (to end of hole) including 8m @ 1.83g/t Au from 52m
Potential for a large-tonnage, low-grade gold deposit can be
seen, and the mineral processing characteristics of this are being
examined to ascertain if it is possible to be heap leached.
Based on the geophysical interpretations, several areas of
structural complexity have been outlined that are interpreted to
have the potential for higher-grade mineralisation.
Work by Moydow/Panthera has consisted of data compilation and
assessment, geological and regolith mapping, rock chip sampling,
preliminary metallurgical test work and time-domain gradient array
induced polarisation (IP) surveying.
This work shows that the K1A mineralisation has a very
well-defined IP chargeability high associated with it, related to
disseminated sulphides in the alteration halo. Based on the very
clear relationship between the chargeability high and
mineralisation, the IP survey has been extended and is currently
being extended once again. To date, eight high priority targets
have been identified with potential for higher-grade
mineralisation.
The second extension of the IP survey is due to be completed
within the next few weeks and targets drill tested after the
current wet season.
Moydow is earning an 80% interest from Golden Spear Mali SARL, a
local joint venture partner, under which there is an obligation to
pay the joint venture partner a fee of US$80,000 (or equivalent in
shares) and incur exploration expenditure of approximately
US$312,000 by 31 December 2021 and approximately US$300,000 by 30
June 2022. The local joint venture partner is entitled to a 0.8%
gross royalty with an aggregate payment cap of US$3 million.
Nigerian Projects
Moydow holds a 20% interest in the Paimasa and Dagma gold
exploration projects in Nigeria, where historically very little
systematic, modern exploration has been undertaken. The projects
are located within the gold-bearing ("Schist Belt") terrain of the
Benin-Nigeria Shield, which has broad similarities to the Birimian
of the Man Shield of West Africa, which over the past 35 years has
become one of the most productive gold provinces globally.
A significant gold project, Segilola, owned by Thor Explorations
Ltd, with a reserve of 0.5Moz gold grading around 4g/t Au, is
currently being developed about 300km southwest of the Moydow
projects.
The projects were targeted based on similarities in geology to
the Segilola deposit and the presence of numerous artisanal gold
miners targeting auriferous quartz veins and associated eluvial and
alluvial gold.
Moydow has conducted two drilling programmes during the last
12-18 months targeting sheeted to stockwork quartz veins that had
previously been mined by local artisanal gold miners.
The first of these at the Dagma Project consisted of four 50m
spaced RC drill fences and returned several significant gold
intercepts including:
-- 3m @ 8.56g/t Au
-- 6m @ 1.61g/t Au
-- 24m @ 0.65g/t Au including 6m @ 1.14g/t Au and 3m @ 1.55g/t Au
The best intercepts were on the southernmost drill traverse and
hence mineralisation is open to the south.
The second drill programme was at the Paimasa Project and this
consisted of two diamond core holes (294.4 metres) and 17 reverse
circulation holes (1369.0 metres) for an aggregate of 1,663.4m
drilling was completed earlier this year. Assays, including the use
of LeachWELL to reduce the effects of coarse gold, are currently in
progress.
Under the farm-in terms, Moydow can earn up to 65% of the joint
venture company that holds the projects by funding US$2m in
aggregate project expenditure on or before July 2023. First Pass
drilling and other early-stage exploration work has been completed
on the projects through the expenditure of approximately US$0.9
million incurred to 31 March 2021.
Substantial Transaction
The "Back-In" right pursuant to the Proposed Transaction
constitutes a substantial transaction under AIM Rule 12. As at 30
September 2020, the reported net book value of Panthera's
investment in Moydow was US$2,500,000 (GBP1,937,626).
As at 30 September 2020, the Company and its subsidiaries had
charged to expenses US$773,388 (GBP608,200) in respect of its
exploration activities on the Labola and Kalaka projects. During
the year ended 31 March 2021, the Labola and Kalaka projects were
disposed of to Moydow.
Contacts
Panthera Resources PLC
Mark Bolton (Managing Director) +61 411 220 942
contact@pantheraresources.com
Allenby Capital Limited (Nominated Adviser & Broker) +44 (0)
20 3328 5656
John Depasquale / Vivek B hardwaj (Corporate Finance)
Financial Public Relations
Vigo Consulting Ltd +44 (0)20 7390 0230
Oliver Clark / Chris McMahon
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Follow the Company on Twitter at @PantheraPLC
For more information and to subscribe to updates visit:
pantheraresources.com
Qualified Person
The technical information contained in this disclosure has been
read and approved by Antony Truelove (BSc (Hon), MAusIMM, MAIG),
who is a qualified geologist and acts as the Competent Person under
the AIM Rules - Note for Mining and Oil & Gas Companies. Antony
Truelove is the COO of Panthera Resources PLC.
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by
the Company to constitute inside information for the purposes of
Regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations
2019/310. Upon the publication of this announcement via a
Regulatory Information Service ("RIS"), this inside information is
now considered to be in the public domain.
Forward-looking Statements
This news release contains forward-looking statements that are
based on the Company's current expectations and estimates.
Forward-looking statements are frequently characterised by words
such as "plan", "expect", "project", "intend", "believe",
"anticipate", "estimate", "suggest", "indicate" and other similar
words or statements that certain events or conditions "may" or
"will" occur. Such forward-looking statements involve known and
unknown risks, uncertainties, and other factors that could cause
actual events or results to differ materially from estimated or
anticipated events or results implied or expressed in such
forward-looking statements. Such factors include, among others: the
actual results of current exploration activities; conclusions of
economic evaluations; changes in project parameters as plans
continue to be refined; possible variations in ore grade or
recovery rates; accidents, labour disputes, and other risks of the
mining industry; delays in obtaining governmental approvals or
financing; and fluctuations in metal prices. There may be other
factors that cause actions, events, or results not to be as
anticipated, estimated, or intended. Any forward-looking statement
speaks only as of the date on which it is made and, except as may
be required by applicable securities laws, the Company disclaims
any intent or obligation to update any forward-looking statement,
whether as a result of new information, future events, or results
or otherwise. Forward-looking statements are not guarantees of
future performance and accordingly, undue reliance should not be
put on such statements due to the inherent uncertainty therein.
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