REG - Galileo Resources - Zambian Exploration Licence joint venture

Galileo ResourcesAnnouncement

05/09/2023 14:00

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RNS Number : 4564L  Galileo Resources PLC  05 September 2023

 

 

5 September 2023

Galileo Resources Plc

("Galileo" or the "Company")

 

Zambian Exploration Licence joint venture

Issue of Equity & TVR

 

The Board of Galileo Resources Plc ("Galileo" or the "Company") is pleased to
announce that the Company has entered into a joint venture agreement with
Cooperlemon Consultancy Limited in relation to the exploration for copper at
large scale exploration license 28001-HQ-LEL in Northwest Zambia (the
"Licence").

 

Highlights

 

·    Licence 28001 - HQ - LEL runs along the Angolan-Zambian border and is
closely associated with the perceived Western Foreland geological district
boundary that potentially hosts Kamoa - Kakula deposits in Northwest Zambia.

 

·    The licence is 52,000 hectares area covering ground in a district
where the Company believes there is scope for the discovery of Kamoa-style
mineralisation.

 

·    There has been limited exploration to date and initial fieldwork will
commence within 60 days on the Licence with a view to defining potential drill
targets as soon as possible.

 

Colin Bird, Executive Chairman said: "This acquisition is consistent with our
policy of acquiring opportunity projects where potential outweighs entry in
reliable jurisdictions. The Project is well-positioned in the emerging NW part
of Zambia which is showing potential not dissimilar to its' Democratic
Republic of the Congo neighbour Kamoa and Ivanhoe exploration areas known as
the Western Foreland. We intend to aggressively pursue this project to test
the potential for near-surface mineralisation as well as the much postulated
Kamoa-style mineralisation. Once targets are generated we will proceed to
drilling as soon as we are able and hopefully before the rainy season
commences. We will keep shareholders posted as progress occurs".

 

Joint Venture Agreement

Galileo yesterday entered into a joint venture agreement with Cooperlemon
Consultancy Limited ("Cooperlemon") in relation to the exploration for copper
at large scale exploration license 28001-HQ-LEL in Northwest Zambia (the
"Licence"). Under the joint venture agreement ("JV Agreement"), Galileo has
agreed the following key terms:

 

Earn-in and Phase 1 exploration budget: Galileo will earn a 65% interest in
the joint venture by;

 

i)          An immediate cash payment of US$230,000 to Cooperlemon;

ii)         funding exploration expenditure over an initial eighteen
month period ("Phase 1") on the Licence of not less than US$750,000.
Exploration is expected to commence in September / October 2023, and will
comprise both physical activity within the Licence boundaries (including but
not limited to mapping, soil geochemistry, geophysics and drilling), and
desktop studies, laboratory analysis and interpretation of data and results.
Galileo anticipates funding this exploration expenditure from existing
resources; and

 

iii)        for the issue of 2,500,000 Galileo Resources plc shares
(the "Consideration Shares") at a price of 1.175 pence per share being the
closing Galileo share price on 4 September 2023 (totalling £29,375). The
Consideration Shares are subject to a three month lock up arrangement and
thereafter a further three months orderly market arrangement. Under the
orderly market arrangement, the Consideration Shares can be sold via the
Company's broker at a price determined by the vendor (the "Nominated Sale
Price")  which shall not be less than the lower of i) the 10 day VWAP and ii)
the closing bid price on the day before the fixing of the Nominated Sale Price
and the Company's broker will have 10 business days to sell the shares at the
Nominated Sale Price.

 

If the Phase 1 exploration results are successful and prove the continuity of
mineralisation at grades suggesting the potential for the future development
of a Mineral Resource of not less than 500,000 tonnes of contained copper,
consistent with economic recovery at the depth of discovery with a minimum
internal rate of return of not less than 25% and a payback period not
exceeding 42 months (including the recovery of capital expenditure), then
there will be a second two year exploration period ("Phase 2").

 

Phase 2 exploration budget: The Phase 2 exploration expenditure of US$1.5
million will also be funded by Galileo who will be the operator of the Licence
for the duration of the Agreement.

 

Consequence of Trade Sale: If there is a trade or any other sale of the
Licence and / or the Joint Venture during Phase 1 of the joint venture then
Galileo will be deemed to have a 55% interest in the Joint Venture.  A sale
requires the agreement of both Galileo and Cooperlemon.

 

Mine Development: In the event the Licence advances to a point where they are
commercially viable and suitable for development then the licence will be
moved to a corporate entity to be owned 75% by Galileo and 25% by Cooperlemon,
and it will be the responsibility of the newly formed corporate entity to
raise all capital for mine development and future operations.

 

Further information on the Licence

Licence No: 28001-HQ-LEL, which comprises 52,083 hectares and expires on 31
May 2025, is held by L and I Investments Limited ("L and I"), a private
Zambian company which with Cooperlemon is under the common control of local
Zambian parties. The Licence is located in North-West Zambia along the
Angolan-Zambian border. L and I has agreed with Galileo to be bound by the
terms and the conditions of the JV Agreement with Cooperlemon (who is acting
on their behalf) as though they were a party to the JV Agreement.

 

 

Geology, location and prospectivity

The style of mineralisation and associated geology and structure responsible
for the Kamoa-Kakula deposit operated by Ivanhoe Mines may extend into the
North-West Zambia.

 

The Western Foreland succession determines the geology of the region and the
Licence lies within the area where the Western Foreland lithology necessary
for Kamoa-style mineralisation can reasonably be expected to occur.

 

 Application to trading on AIM: Application will be made to the London Stock
Exchange for a total of 2,500,000 new Galileo Shares to be admitted to trading
on AIM which rank pari passu to the existing ordinary shares in the Company.
It is expected that Admission will become effective and that dealings in the
new Galileo Shares will commence at 8.00 a.m. on 12 September 2023.

 

Total Voting Rights: On Admission, the number of Ordinary Shares in issue will
be 1,163,188,453  (the "Enlarged Share Capital") which may be used by
shareholders in the Company as the denominator for the calculations by which
they will determine if they are required to notify their interest in, or a
change to their interest in, Galileo under the Financial Conduct Authority's
Disclosure Guidance and Transparency Rules.

 

Further information is available from the Company's website which details the
company's project portfolio as well as a copy of this
announcement: www.Galileoresources.com

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018 ("UK MAR").

The person who arranged for the release of this announcement on behalf of the
Company was Colin Bird, Executive Chairman and Director.

 

 

You can also follow Galileo on Twitter: @GalileoResource

 

For further information, please contact: Galileo Resources PLC

 

 Colin Bird, Chairman                         Tel +44 (0) 20 7581 4477
 Beaumont Cornish Limited - Nomad             Tel +44 (0) 20 7628 3396

 Roland Cornish/James Biddle
 Novum Securities Limited - Joint Broker      +44 (0) 20 7399 9400

 Colin Rowbury /Jon Belliss
 Shard Capital Partners LLP - Joint Broker    Tel +44 (0) 20 7186 9952

 Damon Heath

 

Qualified Person:

Colin Bird: The technical information contained in this announcement has been
reviewed, verified, and approved by Colin Bird, C.Eng, FIMMM, South African
and UK Certified Mine Manager and Director of Galileo Resources plc, with more
than 40 years' experience mainly in hard rock mining.

 

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