Afri-Can Marine Minerals Corporation (TSXV:AFA) signed a Memorandum of Understanding with International Mining and Dredging Holding Ltd. for the development and mining of the Mining Leases under option with Diamond Fields International Ltd. and of the Exclusive Prospecting License 3403, both situated off the coast of Namibia. Under the MOU, Afri-Can and IMDH will create a joint venture company that will fund and operate the mining program on ML 111 and EPL 3403 if deemed economically viable. IMDH will fund the preparation of the mining vessel and Afri-Can will fund the vessel operating costs for the 3 first months of the mining program.
As quoted in the press release:
Salient features of the Memorandum of Understanding are:
- IMDH will design and operate a large sampling program of up to 800 samples mainly on ML 111 and, to a lesser extent, on EPL 3403. The sampling program will serve to establish mining blocks and grades in preparation for mining and to upgrade some of the NI 43-101 inferred resources to the indicated category, as well as further the development of EPL 3403. Afri-Can will fund the program on or before March 1st, 2014. Budgets will be prepared by IMDH and approved by Afri-Can. The Company is currently revising various options in order to raise the funds needed;
- Afri-Can and IMDH will create a joint-venture company, which will fund and operate the mining program on ML 111 and EPL 3403 if deemed economically viable. IMDH will fund the preparation of the mining vessel and Afri-Can will fund the vessel operating costs for the 3 first months of the mining program;
- Afri-Can and IMDH will share equally in the net profits from production after payment of 10% of the net profits to DFI and 10% of the net profits to Woduna Mining Holding (PTY) Ltd.;
- Afri-Can is currently preparing a pre-feasibility study and a preliminary economic assessment (PEA). IMDH will prepare the mining plan from the PEA and from the results of the sampling program;
- The first funding phase of the program will include a payment of US$350,000 to IMDH by Afri-Can, which is due from the last sampling program on EPL 3403 carried out in December 2012. Afri-Can will also deposit US$500,000 with AfrAsia Corporate Finance (Africa) Limited, the first US$200,000 of which will be paid to IMDH in order to complete the transfer of ownership of the remaining 80% of the shares of Thyme Investment (PTY) Ltd (“Thyme”), the owner of EPL 3403. The balance of US$300,000 will serve as a deposit for the funding of the sampling program;
- Upon payment of the US$200,000 to IMDH, Afri-Can will complete the acquisition of all the shares of Thyme and in accordance with the agreement signed with IMDH on September 27th 2010, Afri-Can will issue 9,750,000 of its common shares to IMDH and 3,250,000 of its common shares to BV Investment (PTY) Ltd. Afri-Can will then hold 100% of EPL 3403.
Afri-Can President and CEO Pierre Léveillé said:
We are very pleased with this agreement as it gets us to a level that will allow mining and provide regular development and value for our shareholders. The DFI portfolio of Mining Leases complements EPL 3403 and offers very good development potential. We feel that we are sitting in a strong project in a very solid industry.