Marula Mining, through its South African subsidiary Muchai Mining South Africa (MMSA), has sealed a binding term sheet to acquire a 51% stake in Mansena Kruisrivier Cobalt (MKC).

MKC holds the prospecting right LP30/5/1/1/2/13532PR, covering 2,340.90 hectares of the Kruisrivier 74 JC Farm in Limpopo’s Elias Motsoaledi district in South Africa, encompassing the historic Kruisrivier cobalt mine.

It has submitted a mining permit application, which has been accepted and is expected to be issued soon.

Kruisrivier Cobalt is a former producing cobalt mine that operated intermittently for more than 55 years until the 1930s.

Historical records confirm the presence of high-grade chromium, cobalt, copper, gold, lead, nickel, platinum, silver and zinc mineralisation.

The mine produced and sold cobalt ore concentrates with cobalt grades of up to 16.67% and gold grades of up to 68g/t.

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Marula’s due diligence confirmed visible high-grade cobalt mineralisation at surface level and in shallow underground workings.

As per the commercial terms of the agreement, Marula will issue £100,000 ($128,716) worth of new ordinary shares, followed by a cash payment of £100,000 after final due diligence.

Marula will also cover 100% of the costs to complete an updated bankable feasibility study and pay a monthly management fee of R100,000 (£4,300) to MKC until the feasibility study is completed.

Within the one-year anniversary of signing the term sheet or upon reaching a mining decision, Marula will issue an additional £200,000 in shares as well as pay $1,700,000 in cash fees.

Marula CEO Jason Brewer said: “We are delighted to announce the acquisition of a majority interest in the historic Kruisrivier Cobalt Mine. This strategic move significantly enhances Marula’s portfolio with the addition of a high-grade and brownfield cobalt project.

“Located in one of the world’s premier mining jurisdictions and benefitting from excellent infrastructure, the project presents a potential new development opportunity, particularly with the high-grade cobalt occurrences and other high-value minerals that have been historically reported and identified through recent independent assay work. We now look forward to progressing the project opportunity further.

“This acquisition provides our shareholders with further battery and strategic metals exposure, with cobalt crucial for the production of rechargeable batteries in electric vehicles, making it a critical mineral for the green energy transition.”