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Armadale agrees to sell Mpokoto project

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Global Mining Review,

Armadale has entered into a Heads of Agreement (HOA) with Weghsteen Capital Advice SA (WCA) to sell its interest in the Mpokoto gold project in the Democratic Republic of Congo for total potential consideration of US$562 500 and a 1.5% royalty on gold produced.

WCA is acting on behalf of Radismore Ltd, an investment vehicle incorporated under British Virgin Islands law, which is fully funded and committed to starting gold production at Mpokoto within two years. The HOA is subject to execution of a formal binding agreement, which is expected in 1Q18.

The sale of Mpokoto will be completed in three stages:

  • US$75 000 on signing the purchase contract.
  • US$187 500 within 12 months of signing.
  • US$300 000 on commencement of production.

The proposed agreement will enable Armadale to benefit from future gold production through a 1.5% royalty, and focus on its Mahenge Liandu graphite project.

Nick Johansen, Director of Armadale, said: “We are pleased to have secured this strategic sales agreement and believe that Radismore and its associates have the necessary funds and skill set to advance Mpokoto into production and unlock the asset’s value potential. Crucially, we will retain an interest in Mpokoto through a royalty without the burden of development and production cost. This strategic interest in turn means that we can concentrate our resources on developing the Mahenge Liandu graphite project in Tanzania, which offers near term development opportunity with multiple value accretive milestones expected this year.”

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African mining news