Australian Vanadium (AVL) has entered an option agreement to sell its Coates and Nowthanna Hill projects in Western Australia (WA) to Mining Green Metals (MGM).
The sale includes the two projects’ tenements, application and associated mining information.
These tenements include E70/4924-I (Coates Project), E70/5588 (Coates Project), ELA 70/5589 (upon grant); (Coates Project) and M51/771 (Nowthanna Hill Project).
Under the agreement, MGM will have the option to acquire a 100% stake in the two projects by issuing 6.5 million of its fully paid ordinary shares and $190,000 in cash to Australian Vanadium.
MGM is also required to provide a 0.75% net smelter return royalty from the value of the minerals mined at the projects.
Mining Green Metals has 12 months of the agreement commencement to exercise the option, after which the option will expire.
If the option is exercised by MGM, the transaction will be subject to conditions, including MGM completing due diligence, among others.
Australian Vanadium managing director Vincent Algar said: “With AVL’s primary focus being the development of the Australian Vanadium Project at Gabanintha, the option agreement offers AVL shareholders continued exposure to exploration success at the Coates and Nowthanna Hill projects in a focused exploration company.
“AVL will retain an interest in the projects and be able to benefit from the suite of potential minerals at Coates which are currently in high and growing demand and the future potential from the Nowthanna Hill Project.”
Located near Wundowie 80km north-east of Perth, WA, the Coates Project is expected to hold nickel, base metals, gold and platinum group elements (PGEs).
The Nowthanna Hill uranium project, which has a granted mining licence, is located south and south-east of the company’s Australian Vanadium Project.