Kodal Minerals acquired a 90% interest in the 109km2 ‘Diendio Project’ in southern Mali, consisting of three granted concessions namely the Diendio Sud, Diossyan Sud and Manankoro Nord, in November 2016.
The 109km2 Diendio Project is comprised of three contiguous licence areas located approximately 280km south of Bamako, the capital of Mali. Access to the project is by sealed road from Bamako, then good access throughout the licence area by local road and track.
Kodal acquired up to a 90% interest in the Diendio Project through its wholly owned subsidiary Future Minerals which entered into an agreement with Minefinders Mali SARL (‘Minefinders’), which has a 100% beneficial interest in the three licences Diendio Sud, Diossyan Sud and Manankoro Nord. Minefinders is a local Malian company with interests in mining licences and related businesses. Under the terms of the agreement, Minefinders has agreed to grant Future Minerals exclusive access to the project and rights to explore and mine the project (which includes any mining permits or licences granted in respect of the project). As consideration for the Agreement, Future Minerals has committed to making the following payments to Minefinders:
. US$30,000 which was paid upon signing of the agreement in November 2016; and
. US$35,000 on the first anniversary of signing.
In addition, Future Minerals is responsible for costs associated with the renewal of the three licences. For the Diendio Sud and Diossyan Sud licences, the applications to renew the licences for a further two years have been submitted and are awaiting final approval. The Manankoro Nord licence is in the form of a signed convention and an application has been submitted to receive the arrêté which will be valid for three years.
Upon completion of the acquisition and access payments to Minefinders, Future Minerals will be the beneficial owner of 90% of the Diendio Project, with Minefinders holding 10% and with the right to continue in the project as a free carried partner until completion of a feasibility study.
Upon the granting of a mining licence and incorporation of a new special purpose mining company, Future Minerals will hold 72%, Minefinders 8% and the State of Mali 20%. Minefinders retains the option of choosing between its 8% holding in the mining company and a 3% NSR.
If Minefinders chooses to retain 8% in the newly formed entity, it will contribute to the equity funding pro-rata to its shareholding.