Cape Lambert has signed a binding terms sheet to earn a 70% interest in the Kitwe cobalt/copper tailings project in Zambia.
Signed with Zambian entity Australian Mining Company Zambia (AMCZ), the agreement covers an area spanning 500m².
Under the agreement, Cape Lambert will pay $25,000 upon execution of the terms sheet.
Following the execution, the company will incur an expenditure of $500,000 within a six-month option period to acquire a 70% shareholding in AMCZ.
Cape Lambert Resources executive chairman Tony Sage said: “The acquisition of this significant high-grade cobalt-copper tailings dam emphasises the company’s commitment to becoming a significant player in the cobalt sector.
“There will be obvious synergies available to us with our recently acquired Kipushi Tailings Project located just over 170km away across border in the Democratic Republic of Congo.”
Should the company choose to exercise its option, it will have to make milestone payments to AMCZ. These payments comprise $50,000 upon receipt of an environmental approval, a further $50,000 on the grant of a mining licence, and a further $50,000 upon receiving an export licence for the Kitwe project.
After completion of the acquisition, Cape Lambert will be responsible for managing and funding development of the project.
The project is around 3km from the outskirts of Kitwe, in the Copperbelt region of Zambia.
The transaction is subject to completion of a due diligence, and the execution of a share sale agreement by 31 May.