Altona Rare Earths to proceed with acquisition of Monte Muambe Rare Earths Project
In a 1Q21 update,(ANR ) said it has consolidated its status in the rare earths mining sector by raising capital and appointing experienced new board members.
Altona said its ‘hard work’ over the past 12 months has placed the Company in a strong position as it currently has three potential acquisition opportunities under consideration.
The rare earths exploration firm said the next few months will see the completion of the rigorous due diligence procedures which the Group is currently carrying out on these assets.
The results of the due diligence, together with the board's future economic considerations for each project, will form the basis of which assets the Company will acquire, it noted.
In a separate statement released today, Altona said it has completed the due diligence process for its earn-in arrangement to acquire up to 70% in the Monte Muambe Rare Earths Project which is held by Ussokoti Investimetos Limitada under Prospecting Licence 7573L.
To this effect, Altona has instructed its UK legal counsel to prepare the final contract, as per the terms of the MoU, to start the earn-in process which will end up with it owning 70%.
The project is in a province of Mozambique which hosts several operating coal mines, a major iron mining and steel manufacturing project, as well as other exploration projects.
Intercepts at the project have indicated its potential to host a REE deposit amenable to open pit mining. Initial exploration work will focus on expanding the mineralised zones and identifying new ones, while ascertaining the basic metallurgical characteristics of the ore.
Christian Taylor-Wilkinson, Altona’s CEO, said, "We are pleased with the speed this deal is moving forward. Monte Muambe is, we believe, a significant rare earths project and it is clear both parties are motivated to agree terms and move the project into the exploration phase.”
Meanwhile, in Uganda, the Company signed an Option Agreement on 30 March 2021 to acquire 51% (rising to 70%) of the Nankoma Rare Earths Project, before 30 June 2021.
To date, the Company has collected and sent soil samples from this greenfield tenement to a lab in Australia, for assay under the guidance of Gavin Beer, Altona's Metallurgist.
It is expected that the results of this analysis will be completed in May, which will be used to provide guidance to the board in its decision to proceed, or not, with the acquisition, it said.
In addition, in Malawi, Altona is in the last stages of the due diligence process for the proposed acquisition of the Chambe Rare Earths Project, which it unveiled in September.
Altona said it is waiting for its JV partner in Malawi, Akatswiri Mineral Resources, to confirm the Malawian government's approval of Exploration Licence, APL 0153 for the Project.
Once the licence is granted by the Malawian Mines Department, it is expected a binding agreement will follow allowing Altona to acquire the ionic clay rare earths mining project.
To expedite the deal timetables, Altona said it has appointed local law firms in each of the three jurisdictions where it is looking to acquire a rare earth mining project, a move that the board has agreed will be the standard working practice for Altona in future acquisitions.
The Company said it believes itself to be in a strong position, ‘with cash in the bank and all three African mining opportunities progressing as planned.’ Altona noted that it will provide more information on the completion of the three acquisitions ‘over the next few months.’
Altona Rare Earths is an Aquis-listed mining exploration company which is focused on the evaluation, rapid development and extraction of Rare Earth Element (REE) metals in Africa.
During the year to 31 June 2020, Altona closed a significant 15-year chapter on its Australian coal exploration activities and opened the door onto its new Rare Earth Metals mining strategy, which it believes “has far greater relevance for the world in the 21st Century.”
The past two years has seen a major global shift in the mind-set of rare earth metals end-users, these being primarily the manufacturers of, inter alia, high-strength permanent magnets for the electric vehicle market, military hardware and green power sectors.
Presently, China controls between 90-95% of the supply chain and crucially, also controls the refining and processing sectors, creating a worldwide bottleneck. It also controls more than 70% of EV battery manufacturing, which means a rise in cost of vehicles due to inflated REE prices could cause a significant delay to one of the world's major "Green Solutions".
Global governments are becoming increasingly aware that to increase the numbers of cars on the road, vehicles must be priced suitably. Since there are no viable alternatives to provide the huge quantities of the technology metals, REE mining firms are turning to Africa.
In theory, the company stated that rare earths mining companies in Africa could develop and start supplying Technology Metals to the world's green industries in under three years.
The Company believes it is now poised at the juncture of a significant opportunity within the rare earth metals sector which the group hopes to capitalise during this year and beyond.
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