Pantoro Ltd (ASX:PNR, OTC:PNTOF) has agreed to sell all of its lithium, nickel, copper and cobalt rights on the Norseman Gold Project in the Eastern Goldfields of Western Australia to Mineral Resources Ltd (ASX:MIN) for up to $60 million in cash plus royalties.
The sale will allow Pantoro to focus exploration on its gold assets, while retaining a risk-free exposure to any future lithium or nickel/copper metal projects that are developed within Norsrman.
The sale will strengthen the company’s balance sheet and is a strong return on non-core mineral rights for which no resource exists or were there has been no significant discovery made to date.
Retains tenement ownership
Under the agreement, Pantoro will retain ownership of the tenure and hold all rights to precious and other base metal and battery minerals over the entire tenement package.
Mineral Resources will pay Pantoro $30 million in cash within five days of the signing of a binding term sheet and the remaining $30 million when a final investment decision is made to commence a nickel, copper, and/or cobalt mining operation.
Other considerations include a 2% net smelter royalty on all nickel, copper and cobalt recovered and 0.75% FOB lithium royalty, both subject to certain thresholds that Mineral Resource will have to meet.
Gold primary focus
“This transaction provides Pantoro with strong immediate value for minerals which have not yet been identified in economic quantities at Norseman,” Pantoro managing director Paul Cmrlec said.
“Realisation of value from the assets allows Pantoro to continue to concentrate on production and exploration of its gold assets, with potential value from platinum group elements retained for future consideration.
“We wish Mineral Resources the best of luck with its future exploration campaigns in the area.”