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Predictive Discovery (ASX:PDI) - Managing Director, Paul Roberts - The Market Herald
Managing Director, Paul Roberts
Source: The Market Herald
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  • Predictive Discovery (PDI) has signed an earn-in and joint venture (JV) agreement with Glomin to explore three permit areas in Cote d’Ivoire
  • Under the terms of the agreement, Glomin can earn up to an 80 per cent interest in the permits by managing and funding exploration in two stages
  • Phase one will require a spend of €200,000 (around A$330,000) within 12 months of signing the agreement
  • Stage two will require Glomin to pay for ongoing exploration activities, as well as ore resource estimation, a pre-feasibility study and mining lease
  • The agreement allows PDI to maintain a 20 per cent free carried interest in the permits at no cost while concentrating on its Guinea projects
  • Predictive Discovery closed Thursday's session 2.5 per cent lower at 7.8 cents

Predictive Discovery (PDI) has signed an earn-in and joint venture (JV) agreement with Glomin to explore three permit areas in Cote d’Ivoire.

The deal

Under the terms of the agreement, Glomin can earn up to an 80 per cent interest in the permits by managing and funding exploration in two stages.

Phase one will require a spend of €200,000 (around A$330,000) within 12 months of signing the agreement.

Stage two will require Glomin to pay for ongoing exploration activities, and in the event of a discovery will have to fund ore resource estimation and a pre-feasibility study.

The company will also have to pay for the grant of a mining lease (known as an Exploitation Permit in Cote d’Ivoire) while maintaining the properties as required by local regulations.

After stage two is complete, Predictive will have the option to contribute financially or dilute to a two per cent net smelter return (NSR) royalty on future gold production.

Glomin may thereafter purchase half the NSR for US$10 million (around A$13.89 million), reducing PDI's share to one per cent.

The fine print

If Glomin chooses to discontinue work on any of the three permits within four years of the commencement of the deal, the permit will be returned to Predictive at no cost.

Glomin will also be responsible for all maintenance costs incurred over the term of the agreement.

PDI Managing Director Paul Roberts says there's a lot of upside for the company under the new deal.

"Now that we are firmly focused on our Guinea projects, especially the NE Bankan gold discovery, this new joint venture in Cote d’Ivoire provides ongoing exposure to exploration success on these prospective properties at no cost to Predictive with our joint venture partners managing the exploration activities," Paul said.

"It is important for us to maximise the value of our other West African projects whilst minimising ongoing expenditure wherever possible. This joint venture with Glomin will add value to the portfolio while strengthening our focus on Guinea," he added.

The agreement covers Predictive’s Bocanda Permit, as well as the Issia and Tieningboue applications.

Glomin is a wholly-owned subsidiary of Capital DI, which is an 11.3 per cent shareholder of Predictive.

Predictive Discovery closed Thursday's session 2.5 per cent lower at 7.8 cents.

PDI by the numbers
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