London, United Kingdom, Nov 29, 2012 - (ABN Newswire) - Baobab Resources Limited (LSE:BAO.L - News) through its wholly owned subsidiary Capitol Resources Limitada is pleased to announce that it has signed a Joint Venture Agreement with Australian exploration company Metals of Africa Limited (ASX:MTA.AX - News) in relation to the Company's Changara Project in Tete Province, Mozambique.
MTA has entered into the JVA through its 100% subsidiary Afriminas Minerais Limitada. The JVA is conditional upon MTA receiving approval from shareholders at a meeting of Shareholders that will be convened shortly.
- Baobab's Changara Project exploration licences cover 525km2 and are contiguous with Metals of Africa's 825km2 Rio Mazoe Project tenure.
- Combined, the two project areas control the entire extent of the lower Proterozoic Rushinga Formation, considered highly prospective for Broken Hill Type base metal and manganese mineralisation.
- Metals of Africa is earning into the Company's Changara Project via an unincorporated Joint Venture Agreement. The JVA has a four year, three-stage investment structure:
- 2-stage investment of US$750,000 to earn a 55% interest in the Project.
- Option to fund a third stage of US$1.2m to earn 80% total interest in the Project.
- Baobab has the option to co-fund the third stage work programme on a pro-rata basis to maintain its 45% interest in the Project.
- The Joint Venture will ensure the acceleration of exploration in the highly prospective Changara Project where previous work carried out by Baobab has identified numerous lead, zinc, silver and manganese targets.
Commenting today, Ben James, Baobab's Managing Director, said: 'By combining Baobab's and Metals of Africa's tenure in the Changara area, the entire extent of the highly prospective Rushinga belt can now be more efficiently and effectively explored. Metals of Africa's management team has extensive corporate and technical operating experience in southern Africa and we look forward to working with them in developing this exciting corner of Mozambique.
'The joint venture structure allows Baobab to retain a significant interest in the Changara Project going forward and also enables the Company consolidate its efforts on the Tete Pig Iron Project where the Pre-Feasibility Study is nearing conclusion.'
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