Helix signs $19.5M MoU with Mitsubishi
THE BOURSE WHISPERER: Helix Resources (ASX:HLX) has entered into a Memorandum of Understanding with Mitsubishi Materials Corporation covering the Joshua copper project, located in Region IV Chile.
Project location map. Source: Company announcement
The MoU outlines the funding by Mitsubishi of $4.5 million to fund exploration activities to advance the Joshua project over the next 18 months to earn a 20 per cent Joint Venture interest [Phase 1].
Helix will act as manager of the JV.
“The Joshua copper project has significant potential and we welcome MMC’s support to create value,” Helix Resources chairman Greg Wheeler said in the company’s announcement to the Australian Securities Exchange.
“This deal illustrates the unrecognised value in our Mineral Asset portfolio and we will continue to seek industry partners to advance and monetize this value.”
Upcoming activities will include drilling of IP and alteration targets to confirm the potential size and grade profile, as well as a High Level Scoping study on technical and financial viability aspects.
Mitsubishi has the right after Phase 1 to contribute $15 million in funding and earn a 50 per cent JV interest [Phase 2].
Exploration activities throughout this phase will include a plus-30,000 metres drilling program to determine a JORC Resource.
During this phase there will also be certain Pre- Feasibility Studies carried out on Infrastructure Assessment, Mining and Processing, Environmental Reviews and Detailed Financial Analyses.
Should Mitsubishi not exercise its right after providing Phase 1 funding, the two companies will jointly fund and/or introduce a third party to advance the Joshua project.
Helix said the parties are targeting 31 October 2012 as the anticipated date for completing the deal once Mitsubishi has completed its due diligence process.
MMC is a Japan based multinational company focused on supplying basic materials to the World.
The company has established operating bases in 25 countries and regions worldwide.