Xanadu buys new copper/gold project in Mongolia
Upon completing a due diligence, Xanadu would negotiate a definitive agreement with Temujin to obtain an initial 25% interest in the project. The remaining 75% interest in the project would only be purchased with shareholder approval.
In exchange for a shareholding in the project, Xanadu would issue 3.95-million new shares, as well as A$4.25-million worth of shares, based on the 15-day volume-weighted average price of Xanadu shares.
In addition, Temujin would receive a one-for-two option package with an expiry date of two years.
The final number of shares issued would depend on Xanadu’s share price prior to the date of the general meeting. An additional 15-million shares would also be issued to Temujin when Xanadu defined a Joint Ore Reserves Committee-complaint resource of at least 90-million tons, at an average 1% copper, and subject to a favourable prefeasibility or scoping study.
As part of its initial 25% earn-in for the project, Xanada would also be responsible for expenditures to complete hydrology, environmental and assay reports on the project area.
The ASX-listed miner said that it would spend a minimum of A$5-million on the project in the 30 months after the mining licence has been granted.
In February this year, Xanada shifted its focus to coking coal, copper and gold opportunities in Mongolia, seeking to divest of its Galshar and Khar Tarvaga thermal coal projects.