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- Adavale Resources (ADD) enters a binding farm-in deal to acquire two prospective licences that cover almost 99 square kilometres in Tanzania
- Located near to ADD’s Kabanga NE licence, the licenses are inside the underexplored Luhuma mafic-ultramafic intrusion, which is thought to offer nickel sulphide potential
- The tenements cover a combined area of almost 99 square kilometres, which takes Adavale’s total exploration area to about 1243 square kilometres
- Adavale has the option to acquire up to a 100 per cent interest in both tenements by making four staged payments and committing to the yearly exploration expenditure
- Company shares have been up 5.56 per cent to trade at 3.8 cents
Adavale Resources (ADD) has entered a binding farm-in agreement with the licence holder, Ally Mbarak Nahdi, for two prospective licences in Tanzania.
The tenements cover a combined area of almost 99 square kilometres, which takes Adavale’s total exploration area to about 1243 square kilometres.
They comprise the under-explored Luhuma layered mafic-ultramafic intrusion (LMUI) which is located within the Karagwe-Ankole Belt and sit adjacent to Adavale’s Kabanga NE licence.
According to the company, Luhuma has seen little to no exploration since the 1990s but work completed prior to that suggested the LMUI has the potential to be a significant intrusion that spans up to four kilometres.
One hole drilled by BHP in the 1990s returned a massive sulphide intersection of 8.4 metres at 1.1 per cent nickel. This drill hole lies within a licence held by the Tanzanian Government and is surrounded by one of Adavale’s newly-acquired tenements that it can farm-in to under the new agreement.
Based on that intersection and the little exploration undertaken in the area, Adavale believes it requires modern exploration work, including gravity surveys, to unlock its potential.
Chairman Grant Pierce commented on the licences.
“Securing the right to explore these licences is a major win as Adavale places great value on their prospectivity,” he said.
“We are extremely excited about getting boots on the ground and applying modern technologies to better understand the geometry of the intrusion, potential extensions and define drill targets.”
Adavale plans to conduct ground-truthing work shortly.
The farm-in is broken up into four stages with the first stage giving Adavale the immediate and exclusive right to explore the licences for 12 months once it pays US$12,500 (A$17,580) in cash and US$25,000 (A$35,170) worth of shares.
It must also spend a minimum of US$500 (A$703) per year and per square kilometre across the 98.89-square kilometre area.
If the company chooses, it can proceed to stage two where it has the right to earn a 65 per cent interest in the licences once it pays the vendor US$25,000 in cash and US$75,000 (A$105,500) worth of shares as well as continue to meet the minimum exploration expenditure.
Stage three involves the company increasing its stake to 80 per cent by paying US$50,000 (A$70,300) in cash and US$112,500 (A$158,260) worth of shares. In stage four, the company can buy out the remaining 20 per cent participating interest.
Company shares were up 5.56 per cent to trade at 3.8 cents at 11:20 pm AEDT.
