8th Aug 2016 08:17
LONDON (Alliance News) - Blenheim Natural Resources PLC on Monday said it has entered into a subscription option agreement with TAM Mining Ltd, potentially giving it exposure to a project in Zambia that is highly prospective for both gold and copper.
Blenheim shares were trading flat at 0.35 pence per share on Monday.
The London-listed company will pay a negligible amount to acquire the option, which in turn will give Blenheim the right to purchase a 7.5% stake in TAM. Blenheim said, in return for the stake, it will "use its skills and contacts to assist TAM in raising a minimum of USD5.0 million".
TAM has numerous operations in Africa that focus on precious and base metals. Its headquarters are in St Kitts & Nevis, but the firm also has offices in London and in Lusaka, Zambia.
Blenheim said it plans to start immediately helping to restructure TAM and the board before making the investment.
"TAM's West Lumba project is the most promising mineral project we have reviewed over the past two years, and we are delighted to work with TAM to provide the commercial and technical management input needed to develop TAM's licence area and to help it raise new investment," said Chairman Chris Ells.
Blenheim will be able to exercise the option, once granted, within a six month period after TAM completes a resource statement for the project or within a 12-month period after the agreement is signed, whichever is sooner.
TAM needs to raise the USD5.0 million via "loans or subscription shares" as a condition.
TAM, through its subsidiary, owns a 90% interest in the West Lumba project which contains "iron ore oxide copper gold". A total of 37 holes have been drilled on the asset, and TAM also has acquired data from the previous owner, Brazilian iron-ore giant Vale SA.
"Work to date has revealed numerous targets, including an exploration target within the relatively small (3.0 kilometres-long) initial discovery zone, with mineralisation at depths suitable for low-cost open pit mining, open along strike to the east and west and at depth," said Blenheim.
"Field mapping coupled with interpretation of Vale's geophysical data has indicated extensive zones of mineralisation elsewhere," the company added.
By Joshua Warner; [email protected]; @JoshAlliance
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