The company’s newly appointed board has begun a review of several advanced and early-stage resource projects that it believes will complement and enhance Baraka’s position in the vanadium sector.
Representatives of the board and technical consultants of the company will be in Southern Africa next week as part of this project identification and due diligence process.
The board has also started an immediate review of the technical aspects and legal structure of its investment in the Philippine project.
Majority share in Philippine project
Using funds raised from shareholders over the past several years, Baraka has obtained an effective 75% profit share distribution in the Philippine project through a ‘secured converting loan and profit-sharing agreement’.
More than $2.8 million has been directed to the project though loan monies advanced to an unlisted public company, Consolidated Iron Sands Ltd, and indirectly to its Philippine subsidiary Luzon Iron Development Group.
Baraka’s board is reviewing its payment obligations to this project and is also seeking to replace current directors of these companies with its own nominees, as provided for under the agreement.
Port and special economic zone nearby
The Philippine vanadium project comprises two exploration permits covering around 10,000 hectares, most of which is only 500 metres offshore.
Seismic reports indicate that the sands within the project areas are made up of 3 distinct levels of materials containing vanadium, titanium and iron ore.
The exploration permits are located between 5-8 kilometres from a port and a special economic zone in the Philippines.
Natural gas interest in NT
Baraka also holds an exploration permit in the southern part of the Georgina Basin in the Northern Territory, extending over roughly 16,000 square kilometres.
Drilling completed in 2011 identified the potential for gas, however exploration activities have been limited due to Baraka’s focus on the Philippine project as well as regulatory issues.
The lifting of a fracking moratorium by the Northern Territory Government earlier this year now provides an opportunity for Baraka to purse a potential farm-in partner and complete a strategic review of the asset.
Reducing corporate costs
As part of its review of its investments, Baraka has also implemented a number of measures that will result in a 50% reduction in corporate and administration costs.
The board intents to ensure these costs are kept at reduced levels until the company has secured additional project interests to complement its existing assets and its focus on vanadium resource projects.