Prospect gets US$200k deposit for Penhalonga disposal

AFRICAN lithium developer, Prospect Resources, has received US$200 000 deposit for its Penhalonga gold project it is disposing for US$1 million.

In October this year, Prospect Resources announced that it was seeking to extract value from its non-core assets and thus it had granted Luzich Resources (Africa) LLC, an option to buy the Penhalonga Gold Project.

The lithium producer, which is presently developing the Arcadia Lithium project near Harare, said following the payment of the US$200 000 deposit Luzich can now undertake due diligence on the asset for a period of six months.

“The company is pleased to announce that Luzich Partners LLC has paid the non-refundable deposit of US$200 000 in accordance with the option to purchase the Penhalonga Gold project announced on 23 October 2020.

“Luzich will now undertake due diligence on the asset for a period of 180 days and pay further consideration of
US$800 000 if it elects to exercise the option,” said Prospect.

Luzich is a North American multi-strategy private investment company that was formed in 2013, based in Las Vegas.

The firm has interests in private and public investments globally across a range of industries including mining.

Prospect managing director Mr Sam Hosack was quoted as saying:
“Prospect is focused on maximising shareholder value by rapidly progressing the Arcadia Lithium project and extracting value from its non-core assets.

“The funds received strengthen the company’s balance sheet at a time when sentiment in the lithium market is improving and the opportunity for Prospect to become the next producer in the market is presenting itself.”

The Penhalonga Gold project was being sold on a debt free, cash free basis. It is hoped that completion of the transaction is subject to Luzich being satisfied with its due diligence investigations with Prospect obtaining all necessary regulatory consents and approvals, normal commercial terms and warrants associated with a transaction of this nature.

Meanwhile, Prospect Resources has announced that it has secured a long-term agreement with Sibelco N.V, the world’s largest industrial minerals solutions company to supply petalite from its Arcadia Lithium project.

The seven-year agreement will see the company supplying 700 000 dry metric tonnes (dmt) of high quality, ultra-low iron petalite concentrate during the tenure of the agreement.

It is envisaged that the seven-year agreement is for up to 100 000dmt per annum of high quality, ultra-low iron petalite concentrate while the pricing formula for the agreement is linked to the end customer sales contracts with minimum pricing provisions.

The mining concern has said 100 percent of its 2019 Definitive Feasibility Study petalite production for the first seven years was now covered by offtake agreements.-chronicle.cl.zw