REG - Kavango Resources - KCB – Agreement to acquire six new PLs

Kavango ResourcesAnnouncement

25/09/2023 07:15

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RNS Number : 4403N  Kavango Resources PLC  25 September 2023

25 September 2023

Kavango Resources PLC

("Kavango" or "the Company")

KCB - Agreement to acquire  six new PLs

 

Kavango Resources plc (LSE:KAV), the Southern Africa-focused metals
exploration company, is pleased to announce that it has entered an agreement
with Global Exploration Technologies (Pty) Limited ("GET"), a wholly owned
subsidiary of ENRG Elements (ASX:ENRG) ("ENRG") to acquire a 90% working
interest in six Prospecting Licences ("PLs") located in Botswana's Kalahari
Copper Belt ("KCB") (the "Acquisition").

The PLs cover ground adjacent to Kavango's existing Karakubis Block next to
the Namibian border, currently the priority focus in its KCB copper/silver
exploration programme. The PLs are also adjacent to the Company's South Ghanzi
block in the KCB, giving Kavango a single, contiguous project area to explore.

Kavango is particularly keen to test the combined potential of PL049/2020,
PL052/2020 (in the Karakubis Block) and PL203/2016 (within the area to be
acquiredand satisfaction of certain other conditions).  The Company believes
these three PLs cover a single regional system that incorporates notable domal
structures, which are key exploration targets in the search for large-scale
copper/silver mineralisation.

Ben Turney, Chief Executive Officer of Kavango Resources, commented:

"The new licences join up our Karakubis and South Ghanzi blocks, providing us
with a contiguous, highly prospective system to explore along strike from
major discoveries such as Sandfire Resources' (ASX:SFR) T3 deposit and
Khoemacau Copper Mining's Zone 5 deposit.

We now have uninterrupted control of the single system in this portion of the
Kalahari Copper Belt (KCB). We believe today's acquisition significantly
increases our chances of making a discovery here. We will  push ahead in the
KCB, by reviewing exploration data for the new licence areas and the results
of our recently completed IP surveys at the Karakubis project area. Our goal
is to identify high-confidence drill targets to pursue in Q1 next year.

With completion of the Purebond financing imminent, we are in an extremely
strong position to execute our ambitious plans."

Figure 1: Map of Kavango's KCB landholding

Next steps in the KCB

Recent work by Kavango has included 30km of Induced Polarisation ("IP") survey
lines over targeted areas within its Karakubis group of licences.

Kavango is, in conjunction with David Catterall, an expert on the KCB,
completing a review of all available data for both Kavango's previous and
these six new licences. Kavango has also recently appointed a new Exploration
Manager for Botswana, Mr Leon de Waal, who will be leading the KCB work.
Kavango's goals over the coming months are:

1.   To "level up" its exploration data coverage across its entire KCB
holdings and,

2.   To identify potential sulphide bodies that will be ranked as targets
for future drilling (announced >>> 25 July 2023)
(https://polaris.brighterir.com/public/kavango_resources_plc/news/rns/story/rmvom2r)
.

The current "levelling-up" programme has been designed to field test a new
geological interpretation. Kavango believes it has successfully identified the
lower D'Kar/Ngwako Pan Formations, the contact of which is known to host the
majority of copper-silver mineralisation elsewhere within the Kalahari
Copperbelt, over PL036/2020, PL049/2020 & PL052/2020. The field mapping on
PL036/2020 has effectively extended the area underlain by the lower D'Kar
Formation and for which 5,054 samples have been collected.

Kavango believes the lower D'Kar Formation it has mapped across PL049/2020
& PL052/2020 (in the Karakubis Block)  extends into PL203/2016 (which
Kavango has now acquired), where pathfinder minerals galena and sphalerite
have been observed in historic drill chips.

Preliminary modelling of Kavango's recent IP survey data across an AEM target
on PL049/2020 has already highlighted prospective domal structural trap sites
(announced >>> 25 July 2023
(https://polaris.brighterir.com/public/kavango_resources_plc/news/rns/story/rmvom2r)
) for future drill targeting.

Acquisition terms

Kavango has agreed to acquire a 90% working interest in the six PLs by
acquiring 90% of the issued shares of Icon Trading (Pty) Ltd ("Icon") and
Ashmead Holdings (Pty) Ltd ("Ashmead"), two subsidiary companies of GET.

Kavango shall have exclusive right to appoint directors to the board of both
Icon and Ashmead.

To complete the Acquisition, Kavango will pay GET a total of AUD$2.5 million
in cash in the three following instalments:

-     AUD$1.5 million on the completion of the Acquisition

-     AUD$500,000 90 days after the completion of the Acquisition

-     AUD$500,000 180 days after the completion of the Acquisition

The names of the PLs, along with their existing owner, status, and expiry
date, can be found in Figure 2 below.

 PL Number               Company                     Status         Expiry Date
 PL127/2017              Ashmead Holdings (Pty) Ltd  2nd Renewal    30/06/2024
 PL128/2017              Ashmead Holdings (Pty) Ltd  2nd Renewal    30/06/2024
 PL129/2017              Ashmead Holdings (Pty) Ltd  2nd Renewal    30/06/2024
 PL203/2016              Icon Trading (Pty) Ltd      3rd Renewal    30/09/2025
 PL204/2016              Icon Trading (Pty) Ltd      3rd Renewal    30/09/2025
 PL205/2016 1  (#_ftn1)  Icon Trading (Pty) Ltd      3rd Renewal    30/09/2025

Figure 2: Details of the GET PLs

 

The agreement will complete on the receipt of necessary permissions in
Botswana on or after 30 OCtober 2023 and satisfaction of certain other
conditions.

Under the terms of the transaction, Kavango will assume the benefit of the
outstanding intercompany loans for historic exploration onto its balance
sheet. Icon and Ashmead  will retain ownership of all historic exploration
data gathered by them.

Financing update

Kavango continues to finalise the circular and prospectus for the forthcoming
Stage 2 financing with Purebond (announced >>> 09 May 2023
(https://polaris.brighterir.com/public/kavango_resources_plc/news/rns/story/rm4dy8r)
for £4.6million at 1p per share). The Company expects to publish the Circular
in the coming days and call the general meeting to seek approval from
independent shareholders of a waiver in accordance with Rule 9 of the Takeover
Code (Whitewash) in relation to this transaction.

In the event there is a delay in completing the Stage 2 financing, Purebond
has indicated to Kavango's board its readiness to lend the Company sufficient
funds to complete the Acquisition.

Further information in respect of Kavango and its business interests is
provided on the Company's website at www.kavangoresources.com and on Twitter
at #KAV.

For further information please contact:

Kavango Resources plc

Ben Turney

+46 7697 406 06

First Equity (Broker)

+44 207 374 2212

Jason Robertson

Kavango Competent Person Statement

The technical information contained in this announcement pertaining to geology
and exploration have been read and approved by Brett Grist BSc(Hons) FAusIMM
(CP).  Mr Grist is a Fellow of the Australasian Institute of Mining and
Metallurgy with Chartered Professional status.  Mr Grist has sufficient
experience that is relevant to the exploration programmes and geology of the
main styles of mineralisation and deposit types under consideration to act as
a Qualified Person as defined in the 2012 Edition of the 'Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves'.

 

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