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Australia’s MRG Metals has signed an agreement in principle with Australian company Sofala Resources Pty Ltd. to acquire three concessions in Mozambique for the exploration of heavy sands, the company said in a statement issued on Wednesday.
The agreement stipulates that MRG Metals has three months to take the necessary steps to ascertain the quality of the heavy sand deposits and that if it intends to proceed with the deal, after that deadline, it has to pay the sellers US$100,000 in addition to 175 million shares and an equal number of options.
MRG Metals will also have to provide Sofala Resources Pty Ltd. with an additional 720 million shares based on meeting certain project development goals.
Chief executive Andrew Van Der Zwan said in the statement that the company has looked at more than 70 possible deals over the past few months and that this potential acquisition has to meet the objectives set out.
The so-called Corredor (Central e Sul) concession is the most advanced of the three, with the other two Marão & Marruca and Linhuane, all in the province of Gaza, covering an area of 387 square kilometres,
The statement noted that the Corredor concession is close to the Corredor 1 heavy sand deposits, which is producing 500,000 tons of ilmenite, 35,000 tons of zircon and 10,000 tons of rutile.
The Marão and Marruca concession is the largest of the three, with an area of 491 square kilometres, and is located about 50 kilometres from the Indian coast, with the Linhuane concession being the smallest of all, covering 113 square kilometres located along the coast. (macauhub)