Winmar Resources has backed off from the Lomero project joint venture (JV) with Kimberley Diamonds (KDL) in Spain.
The move comes after KDL entered voluntary administration in June.
The company noted that the decision to withdraw from the JV project was taken to eliminate costs associated with its maintenance.
Acting in accordance with legal advice, Winmar stated that it will not incur expenditure towards the project until the ownership status is resolved.
Winmar Resources managing director Rod Sainty said: “I am optimistic that an attractive project can be secured within the coming months. We are working diligently to create a new phase of growth in value for our shareholders.”
At present, the project is subject to the KDL administration process.
Winmar also noted that proposals were made on several occasions to the administrator of KDL to acquire the project.
However, the company is currently searching for opportunities to identify and acquire a new mineral project.
The consideration for the acquisition of the new project includes potential opportunities in gold, copper and zinc, along with energy metals lithium and cobalt.
The company added that several projects have so far been reviewed and negotiations have been held with the respective vendors.
A private placement and rights issue was completed by the company, raising an aggregate capital of $492,000 to finance the acquisition.