Africa-focused mining and development company Marula Mining, through its wholly owned South African subsidiary Muchai Mining South Africa, has signed a binding term sheet with South African mining company Mansena Cobalt to acquire a 51% shareholding in Mansena Kruisrivier Cobalt (MKC).
MKC is the registered holder of prospecting right LP30/5/1/1/2/13532PR, which extends over 2 340.90 ha of the Kruisrivier 74 JC Farm in the Elias Motsoaledi district of Limpopo, South Africa, and which includes the historical Kruisrivier cobalt mine.
MKC has lodged a mining permit application, which has been accepted and is expected to be issued in due course, Marula reports.
Kruisrivier cobalt is a former producing cobalt mine that operated intermittently for over 55 years up to the 1930s.
Historical records confirm the presence of high-grade cobalt, gold, nickel, copper, chromium, zinc, lead, platinum and silver mineralisation, as well as production and sales of high-grade concentrates of cobalt ore of up to 16.67% cobalt and accompanied by high-grade gold grades of up to 68 g/t.
Current non-Joint Ore Reserves Committee- (Jorc-) compliant historical resources of 733 000 t of ore grading 8% cobalt have also been reported down to a depth of 200 m.
Due diligence work completed by Marula and its technical team has confirmed the presence of visible high-grade cobalt mineralisation and which has been identified at surface in waste stockpiles and in the shallow underground workings in narrow veins and lenses of cobalt ore of between 0.5 m and 4 m in width.
The cobalt mineralisation occurs as a cobalt arsenate deposit with both safflorite and erythrite.
Independent assay results on samples taken in the fourth quarter of 2023 reported 8.31% cobalt, 0.81% nickel, 323 g/t molybdenum and 164 g/t gold, and also 2.73 g/t palladium, 0.16 g/t platinum, 1.91 g/t rhodium and 86 g/t gold.
Under the commercial terms of the term sheet, Marula will issue about one-million new ordinary shares, valued at about £100 000, to Mansena Cobalt and then make a further cash payment of £100 000 on completion of final due diligence.
It will also fund 100% of the costs to complete an updated bankable feasibility study (BFS), as well as pay a monthly management fee of R100 000 (about £4 300) to Mansena Cobalt until completion of a feasibility study.
On the earlier of 12 months from signing of the term sheet or a decision to mine, the company will issue a further £200 000 of ordinary shares and pay a cash fee of $1.7-million.
The company’s technical team has completed a detailed due diligence review of Kruisrivier cobalt which included an assessment of historical data and information, as well as a site visit in April and May.
The company will, under the term sheet, complete a detailed and systematic exploration programme and detailed geological investigation to confirm previous extensive historic data and establish a Jorc-compliant mineral resource
This exploration work will include satellite multispectral analyses, airborne geophysics, surface and underground rock chip channel sampling, resource drilling and core analyses.
Further work will include the completion of a BFS that will incorporate detailed process mineralogy, extractive metallurgy, and process development studies which will include either pyrometallurgical or hydrometallurgical processing routes given the mineralisation.
The company plans to complete all the necessary technical studies to complete a BFS over the next 12 months.
This acquisition further strengthens Marula’s expanding operational and development-stage strategic battery metals portfolio in Africa, the company states.
It is considered strategically important and provides the company with a high-grade and brownfield cobalt project opportunity which has demonstrated cobalt grades significantly higher than those found in the African Copperbelt and in the Democratic Republic of Congo, which accounts for the majority of the world’s cobalt production and reserves, Marula points out.
Completion of the final due diligence by the company and execution of a formal share sale and purchase documentation for its interest in MKC are expected to be completed in the third quarter.