Bushveld Minerals is set to acquire the majority of a tin tailings dump, which may have the potential for early production from its Mokopane project in South Africa.
Bushveld will pay £559,470 for 87% of the Zaaiplaats tin tailings dump, which is estimated to contain between 2,600t and 4,500t of tin.
Zaaiplaats dump is an asset owned by Zaaiplaats Mining, a company 60%-owned by the Brent Trust and 40%-owned by Sephaku Tin.
The deal is conditional upon the outcome of technical due diligence and evaluation of the Zaaiplaats dumps, to be undertaken by Bushveld over a two month period, which started on 20 March.
Under the deal, a technical committee led by Bushveld with representatives from Sephaku Tin will be established to oversee the project's development.
After completion of the technical due diligence and evaluation to the satisfaction of Bushveld, the company will acquire a 47% shareholding in Zaaiplaats Mining.
Bushveld will fund the development of the Zaaiplaats dump up to the feasibility stage and have the option to acquire an additional 40% shareholding in Zaaiplaats Mining from Brent Trust, for £335,700.
Bushveld Minerals chief executive officer Fortune Mojapelo said that, having started a technical work programme on the Zaaiplaats dump, including a review of historical data and additional mineralogical and metallurgical testwork, the company has begun to understand the potential of the asset and to de-risk it.
"Its location in close proximity to, and between the Groenfontein and the Zaaiplaats hard rock deposits, on which we already have a combined 18,477t of contained tin resource, gives Bushveld scope to add an early tailings-first production scenario to our Mokopane tin project, with the potential of materially enhancing the economics of the Mokopane tin scoping study," Mojapelo said.
"We have thus extended the timeline for the release of the scoping study in order to evaluate including the Zaaiplaats dump within it."