Zinc junior Trek Metals is buying up 100 per cent of the Kroussou zinc-lead project in Gabon from Battery Minerals.
The ASX-listed junior explorer will pay US$400,000 (A$508,000) in cash and securities to Battery Minerals plus deferred consideration of shares and options totalling US$2.5 million (A$3.2 million) subject to a 250,000 tonne mineral resource being estimated at the project.
The news comes after Trek entered into a farm-in agreement to earn 70 per cent of the project. Koroussou witnessed intermittent historic exploration from 1962 to 1980 which identified significant near-surface base metal mineralisation with drill testing limited to a small number of target areas.
“The project presents a truly magnificent opportunity for Trek to grow substantially with the potential for the discovery of a very significant zinclead orebody in Gabon,” Trek Managing Director Bradley Drabsch.
“The price of zinc is continuing to appreciate to near record levels and we are poised to take full advantage at this time”.
Trek will also grant a 2.5 per cent net smelter royalty on the project to Battery Minerals which is subject to a 1 per cent buyback by Trek with payment of US$1.5 million cash.
Battery Minerals Executive Chairman David Flanagan said it was perfect time for the project to be wholly owned by one ASX-listed company given it was focused on developing its graphite project in Mozambique.
“At the same time, Battery Minerals will retain significant upside to the Kroussou Project through the mineral resource estimate based deferred consideration and NSR.”
Trek and Battery Minerals were both trading unchanged at 3.6c and 6.5c respectively in afternoon trade.