Altair Resources has signed a letter of intent (LoI) with Rhenium Technology to acquire the former producing zinc-lead-silver Grund mine project in the Harz region of Germany.

The proposed acquisition will be achieved through the purchase of all of the issued and outstanding shares of Rhenium.

Once the transaction is closed, Rhenium will operate as a wholly owned subsidiary of Altair.

Under the LoI, Altair will issue an aggregate of 9,640,000 common shares to Rhenium shareholders once the acquisition is complete.

Altair Resources chairman and CEO Harold Shipes said: “The Bad Grund mine represents a very major acquisition in a prolific mining district in a safe and supportive jurisdiction.

“It holds excellent exploration potential and significant amounts of developed material ready for mining.

“It holds excellent exploration potential and significant amounts of developed material ready for mining.”

“It hosts an impressive infrastructure with all support facilities, including abundant water, adequate electricity, tailings disposal facilities, as well as extensive underground depleted mine areas suitable for paste backfill of tailings, road, rail, and air access, all office buildings and shops.”

The company noted that the acquisition complements its Pan American mine in Lincoln County, Nevada, US, in addition to providing an opportunity to accelerate production.

Rhenium shareholders will also be entitled to a 2% net smelter returns (NSR) royalty on the silver and zinc produced from the Grund mine project.

Altair reserves the right to repurchase 50% of the NSR by the issuance of an aggregate of 3,500,000 common shares.

Located in the Harz Mountain region of central Germany, the mine closed in 1992 due to the depressed price of zinc.

The mine comprises 15,655ha of mining rights, as well as a surface lease covering all mine sites and industrial facilities in the city of Grund.

Completion of the transaction is subject to certain closing conditions.