Cradle Arc’s wholly owned subsidiary Caracal Gold Mali has signed a joint venture (JV) agreement to advance its Kossanto West gold project in western Mali.

The JV deal with Indiana Resources’ subsidiary Mukuyu Resources (Mali) for the exploration and development of the project is consistent with Cradle Arc’s strategy to retain exposure to its African gold exploration portfolio while minimising investment.

“There will be minimal impact on the company’s balance sheet as we continue to focus on our core asset in Botswana.”

The 137km² Kossanto West gold project comprises the Kobokoto Est and Koussikoto exploration permits.

Under the terms of the agreement, Indiana Resources is required to incur expenses for all project-related costs up to and including the completion of a pre-feasibility study (PFS).

Once the PFS is completed, Indiana Resources will own a 65% participating interest in the exploration permits and the remaining 35% interest will be held by Cradle Arc.

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Thereafter, the JV parties will share the project costs proportionate to their participating interest.

Cradle Arc CEO Kevin van Wouw said: “This agreement enables Cradle Arc to advance its highly prospective West African gold assets, whilst maintaining its primary strategic focus on the development of the Mowana Copper Mine.

“The terms of the JV do not require Cradle Arc to fund exploration activities up to the PFS stage, such that accordingly there will be minimal impact on the company’s balance sheet as we continue to focus on our core asset in Botswana.”

The JV partners will work towards the formation of a new company for the future development of the Kossanto West project.

Cradle Arc and Indiana Resources will hold 90% of the new entity and the Malian Government will own the remaining 10%.

Indiana Resources will carry out the initial work programme over the first 12 months.

The programme includes additional geological mapping of Kossanto West with potential follow up pitting and trenching activities and reconnaissance drilling.