logo-loader
viewSavannah Resources PLC

Savannah Resources and Rio agree Mozambique deal

The commercials remain broadly similar to the original agreement to bring together the projects,

HeavySands.png
Finished product: The project is a giant heavy mineral sands deposit.

Savannah Resources Plc (LON:SAV) expects to begin a scoping study immediately on its enlarged heavy minerals sands project in Mozambique having brokered a new deal to combine assets with mining giant Rio Tinto PLC (LON:RIO).

The commercials remain broadly similar to the original agreement to bring together the projects, which are next to each other and are effectively component parts of the same deposit.

To speed up the process, Savannah’s Jangamo property and Rio’s Chilubane and Mutamba areas will go into a consortium company at a later date, likely to be after the grant of mining licence.

The AIM-listed mine developer will have an initial 10% stake in and operatorship of the merged entity, which will rise to 51% as it achieves certain milestones.

The scoping study, to assess the potential of the projects, is one of those landmarks. It will kick off immediately and is expected to be complete by the first quarter of next year.

Mutamba-Jangamo includes an established 65mln-tonne resource and significant expansion potential. The exploration target is out at between 7-12bn tonnes at a grade ranging from 3% to 4.5% total heavy minerals sands.

The tie-up with Rio was first announced last summer. The latest agreement follows consultation with the Ministry of Mineral Resources and Energy of Mozambique.

A “delighted” chief executive David Archer said: “Agreeing an arrangement that enables exploration activities to be conducted on a unified basis across the Mutamba, Dongane and Jangamo projects makes significant commercial sense, effectively combining three areas which are part of the same, continuous mineralisation trend.”

Quick facts: Savannah Resources PLC

Price: 2.15 GBX

AIM:SAV
Market: AIM
Market Cap: £27.9 m
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Savannah Resources PLC named herein, including the promotion by the Company of Savannah Resources PLC in any Content on the Site, the Company...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Savannah Resources’ Grandao lithium deposit ‘continues to grow’

David Archer, chief executive of Savannah Resources Plc (LON:SAV), tells Proactive Investors they're seeing continued encouraging results from their ongoing reverse circulation and diamond drill programme at the Mina do Barroso project in Portugal. He says they've identified 'significant...

on 26/7/18

2 min read