Monday, March 07, 2011
Hodges Resources (ASX: HDG) has optioned the Moruple South Coal prospect, a strategic coal prospect with a target resource of 1.4 billion tonnes in Botswana.
The Morupule South Coal Prospect is adjacent to the operational Morupule mine and Colliery which is the only operational coal fired power plant in Botswana.
Given the upward share price trajectory of another Botswana coal explorer, African Energy Resources (ASX: AFR), with its Sese Coal Project in eastern Botswana, the deal by Hodges to option a coal prospect with a target resource of 1.4 billion tonnes is interesting, indeed.
Under the terms of the agreement, Hodges can initially earn 75% by completing the payment of US$500,000 cash on execution of the agreement and spending US$3,000,000 over two years, with a requirement to spend the first US$1,000,000 within the first year.
On completion of the terms above the companies will incorporate a special propriety company in Botswana that will hold the permit and form a joint venture company.
Hodges can then exercise its option to acquire an additional 24% in the JV through payment of US$0.10 per tonne of all JORC classified Measured and Indicated Resources calculated at the end of the initial farm‐in agreement (two years).
On initiating this payment Hodges must solely fund an additional US$2,000,000 of exploration costs over a two year period and on completion pay SNDP $0.08 per tonne of additional JORC classified Measured and Indicated Resources from an updated report.
Hodges has the exclusive right, until 2nd May 2011, to conduct due diligence prior to entering into the binding agreement.
Located within the eastern central district of Botswana, the Moruple South Coal prospect joint venture has significant mineable coal seams within the area supported by work completed by the current owner and the neighboring companies and a preliminary report undertaken by GEMECS.
Importantly the project areas have had minimal exploration and coal quality analytical work.
Botswana has extensive unexploited coal resources estimated to be in the order of 212 billion tonnes, making it one of the most coal rich countries in Africa.
Botswana is located within southern Africa and has a stable multi‐party democracy and is considered to have a medium to low political risk, similar to Namibia.
The Morupule South Coal Prospect is adjacent to the operational Morupule mine and Colliery which is the only operational coal fired power plant in Botswana.
Given the upward share price trajectory of another Botswana coal explorer, African Energy Resources (ASX: AFR), with its Sese Coal Project in eastern Botswana, the deal by Hodges to option a coal prospect with a target resource of 1.4 billion tonnes is interesting, indeed.
Under the terms of the agreement, Hodges can initially earn 75% by completing the payment of US$500,000 cash on execution of the agreement and spending US$3,000,000 over two years, with a requirement to spend the first US$1,000,000 within the first year.
On completion of the terms above the companies will incorporate a special propriety company in Botswana that will hold the permit and form a joint venture company.
Hodges can then exercise its option to acquire an additional 24% in the JV through payment of US$0.10 per tonne of all JORC classified Measured and Indicated Resources calculated at the end of the initial farm‐in agreement (two years).
On initiating this payment Hodges must solely fund an additional US$2,000,000 of exploration costs over a two year period and on completion pay SNDP $0.08 per tonne of additional JORC classified Measured and Indicated Resources from an updated report.
Hodges has the exclusive right, until 2nd May 2011, to conduct due diligence prior to entering into the binding agreement.
Located within the eastern central district of Botswana, the Moruple South Coal prospect joint venture has significant mineable coal seams within the area supported by work completed by the current owner and the neighboring companies and a preliminary report undertaken by GEMECS.
Importantly the project areas have had minimal exploration and coal quality analytical work.
Botswana has extensive unexploited coal resources estimated to be in the order of 212 billion tonnes, making it one of the most coal rich countries in Africa.
Botswana is located within southern Africa and has a stable multi‐party democracy and is considered to have a medium to low political risk, similar to Namibia.
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