ASX-listed New Age Exploration (NAE) on Thursday announced the sale of its Lochinvar coal project, in the UK.
Selling the Lochinvar project will enable NAE to focus its exploration efforts at its core gold and lithium assets in central Pilbara and New Zealand.
In terms of the share sale agreement, Paladar Trading will acquire the asset for A$1 in cash, as well as A$1/t royalty on the first 15-million tonnes of any minerals, ores or concentrates extracted from the licences comprising the Lochinvar project.
“"We are pleased to announce the sale of Lochinvar Coal Limited, a strategic move that positions NAE to potentially earn up to A$15-million in royalties from future coal production at the project, subject to the successful development of the project by Paladar,” comments NAE executive director Joshua Wellisch.
The Lochinvar project consists of three adjacent exploration and conditional underground mining licences known as Lochinvar, Lochinvar North and Lochinvar south.
In October 2014, NAE completed a scoping study which confirmed the potential for a low cost long life 1.9-million-tonne-a-year long wall mining project to deliver 1.4-million tonnes a year of coking coal to UK and European markets.
The study was updated in March 2017 and delivered a robust set of economics.