African Battery Metals acquires an 18.26% stake in Kalahari Key. Credit: Анатолий Стафичук from Pixabay.

Battery metal exploration and development company African Battery Metals (ABM) has entered a share acquisition and earn-in agreement with Kalahari Key Mineral Exploration for nickel and platinum group metals (PGMs) in Botswana.

Under the terms of the agreement, ABM has acquired an 18.26% stake in Kalahari Key, an exploration company in Botswana with a 100% interest in the Molopo Farms Complex (MFC) project in south-west Botswana, for a total consideration of $194,810.

By 31 December 2019, ABM is also expected to opt for an earn-in to a 40% direct project interest in the MFC Project by spending $500,000 by 31 December 2020 on ground exploration, primarily for the completion of drilling of four targets at the MFC Project.

After completion of the earn-in expenditure requirement, ABM will hold an interest of 50.96% in the MFC Project through its 18.26% shareholding in Kalahari Key and a 40% direct interest in the MFC Project.

It will also have representation on the MFC Project operating committee and the board of Kalahari Key.

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The MFC Project consists of three exploration licences, covering 2,725km² for nickel, PGM and copper ores.

A recently conducted helicopter-borne electromagnetic and magnetic survey by Kalahari Key using Xcite System from New Resolution Geophysics has identified 17 zones for ground exploration follow-up.

Kalahari Key had acquired two mineral exploration licences (PL310/2016 and PL311/2016) from the Botswana government in November 2016 covering parts of the Bushveld-related Molopo Farms Complex in southern Botswana, and a third licence (PL202/2018) in 2018 to the south of PL311/2016.

“ABM will have representation on the MFC Project operating committee and the board of Kalahari Key.”

For the initial 18.26% interest in Kalahari Key, ABM has acquired 3,157 new ordinary shares in Kalahari Key at $55 per share for cash consideration of $173,635. Under the agreement, at least 75% of the new working capital should be invested in ground operations at the MFC Project.

ABM has also acquired 385 existing ordinary shares in Kalahari Key from Value Generation for $55 per share for cash consideration of $21,175. It has acquired 3,542 shares for a total acquisition cost of $194,810, which will be met from existing cash resources and hold an 18.26% stake in Kalahari Key.

African Battery Metals will also have the right to maintain its percentage holding in future Kalahari Key deals.

After ABM enters into the earn-in, a joint venture agreement will be signed, which will determine strategy, operational management and corporate structuring.