LONDON (Alliance News) – Mining investment company Red Rock Resources PLC clarified on Wednesday the due diligence process it was undertaking with regards to its potential new joint venture in the Democratic Republic of Congo with Cobalt Blue Ltd.
The company said it had engaged SGS South Africa Pty Ltd, part of the SGS SA Group to test drill the Kamirombe and Kalumba tailings which are near Kolwezi in Lualaba province. The auger will be mobilised on Thursday and drilling should start on Saturday, the company said.
SGS will also provide a hand-held x-ray fluorescence spectrometer to enable instant readings prior to samples being sent for analysis in Lubumbashi at laboratories operated by SGS.
The operation will be supervised by the mining consultancy CSA Global Pty Ltd.
The joint venture, announced on September 26, involves four or five copper/cobalt tailings in the DRC. These include Kamirombe and Kalumba.
The company had 40 days from September 26 to complete its due diligence.
The company explained that “the objectives of the programme are: first, to provide geological information for the due diligence process to enable a decision on whether to proceed with the transaction; secondly, to provide, before the Autumn rains set in, as much as possible of the information which could enable an early inferred mineral resource to be generated in the event of proceeding, which would establish a baseline for valuation and expedite the process of producing a feasibility for the project.”
Should it continue with the joint venture, Red Rock will take a 26.25% stake in the new company in return for USD700,000 cash and GBP490,000 worth of Red Rock shares at 0.65 pence each. The company will also take a provision of USD1.2 million for exploration work over the first 18 months.
Once the feasibility study is completed with the exploration work, Red Rock will have the option to increase its stake by 26.25% for USD1.0 million.
Shares in Red Rock closed 4.0% lower at 0.600 pence on Wednesday.
By Ahren Lester; firstname.lastname@example.org.
SOURCE: INTERACTIVE INVESTOR
DATE: OCTOBER 18, 2017