Katoro Signs JV Agreement with Lake Victoria Gold

RNS Number : 8292D

Katoro Gold PLC

07 March 2022

 

Katoro Gold plc (Incorporated in England and Wales)

( Registration Number: 9306219)

Share code on AIM: KAT

ISIN: GB00BSNBL022

("Katoro" or "the Company")

 

Dated: 07 March 2022

Katoro Gold PLC ('Katoro' or the 'Company')

Update on Imweru Gold Project

Katoro Signs Joint Venture Agreement with Lake Victoria Gold

Katoro Gold PLC (AIM: KAT), the gold and nickel exploration and development company, announces that it has entered into a Joint Venture Agreement ('Agreement') with Lake Victoria Gold ('LVG') for the development of the Company's Imweru Gold Project ('Project'). Under the Agreement, LVG will earn up to 80% in the Project, with the balance of 20% being held by Katoro as a carried interest.

The Company previously announced to the market that the Project was disposed of by virtue of a sale transaction (see RNS of 12 June 2020). The administrative process to finalise registration of the sale transaction, and therefore trigger ongoing milestone payments due to Katoro, was subsequently indefinitely delayed due to unforeseen statutory barriers related to the transfer of ownership at project level. This created a situation where no definitive schedule date could be established for transfer of ownership and issue of the relevant milestone convertible loan notes. In light of this unsustainable situation the Company and LVG agreed to cancel the sale transaction and to enter into a Joint Venture instead ("the JV").

Agreement Highlights

· JV Funding:

§ LVG will earn a JV-interest of up to 80% in the JV and will be responsible for 100% of the JV funding requirements.

§ All debt funding required by the JV will be procured or provided by LVG.

§ The JV will reimburse Katoro for previous expenditures in the amount of € 792,000 on or before 31 December 2023

· Management:   The JV shall appoint a Project Manager to manage the Project.

· Cancellation Agreement:   The original Agreement to dispose of the Project will be cancelled by mutual consent of the parties.

· Appointment of Directors: Three directors, two nominated by LVG and one by Katoro will form the Board of the JV.

Katoro CEO, Louis Coetzee, commented: "The decision to cancel the sale of the Project and to enter into a Joint Venture instead was a strategic decision by the Katoro Board to address challenges that made it impossible to complete the sale agreement within an acceptable time frame. We are looking forward to growing this JV-partnership with LVG, who is currently developing the Imwelo Gold Project. With Imwelo being located adjacent to Imweru and in advanced stage of development towards first production, we believe that the combination of the two projects will create a larger and significantly more economic project that will be able to attract suitable funding to accelerate the further development and exploitation of the combined gold mining project."

Further information on the Agreement

· LVG is an unlisted public company, incorporated in Australia, operating multiple exploration licences including its key project, the Imwelo Gold Project in Tanzania ('Imwelo'), located adjacent to Imweru and also holds the relevant environmental approvals and mining licence for Imwelo.

· The current, JORC code compliant, mineral resource for Imweru and Imwelo consists of 11.6 Mt at a grade of 1.38 g/t for 515,110 oz Au and 4.7 Mt at 1.92 g/t for 291,600 oz Au respectively and probable reserve for Imwelo consists of 1.4 Mt at 2.2 g/t for 97,394 oz Au.

This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) no. 596/2014.

**ENDS**

For further information please visit www.katorogold.com or contact:

Louis Coetzee	[e-mail]	Katoro Gold plc	Executive Chairman
Bhavesh Patel Andrew Thomson	[phone]	RFC Ambrian Limited	Nominated Adviser
Nick Emmerson Sam Lomanto	[phone]	SI Capital Ltd	Broker
Sewela Makgolane	[e-mail]	Lifa Communications	Investor and Media Relations Adviser

 

END

 

 

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