Aeon strikes JV with Rio in Queensland

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THE BOURSE WHISPERER: Aeon Metals (ASX: AQR) has executed an Exploration and Earn-In Joint Venture Agreement with Rio Tinto Exploration (RTX) for the exploration and evaluation of Aeon’s 100 per cent-owned tenement EPM 17060 in Queensland.

 

Source: Company announcement

 

The key terms of the deal are as follows:

Phase 1 (12 months) – Exploration:

RTX is to sole fund an exploration program and any associated expenditure to a minimum of $200,000.

Phase 2 (36 months) – Earn-In:

If RTX elects to conduct further exploration it will then commit to a total expenditure of $2.5 million over the Phase 2 period to earn its initial interest.

RTX and Aeon will form an unincorporated Joint Venture to continue the project with the participating interests of RTX: 70 per cent; and Aeon: 30 per cent.

Phase 3 (5 years) – Pre-Feasibility:

Within thirty days of formation of the JV, Aeon must notify RTX whether or not it will contribute its share of future funding of the project on a pro-rata basis, as per the parties’ participating interests in the JV.

If Aeon elects not to contribute its share of future funding, RTX will have no further obligation to fund the project but may elect, in its sole discretion, to continue to sole fund the Project, in which case it will commit to: expenditure of $15 million; or completion of a pre-feasibility study, whichever occurs first, within a period of five years from the satisfaction of the Phase 2 commitment to earn an additional 20 per cent interest.

“This transaction highlights the prospectivity of the mineralised province for multiple large base metal ore bodies such as Aeon’s per cent-owned Greater Whitewash polymetallic project, which lies on the geological north-south structure approximately three kilometres from the border of EPM 17060,” Aeon Metals said in its ASX announcement.

“The earn-in and joint venture with RTX will allow Aeon to focus its exploration and development on the Greater Whitewash, John Hill and Kiwi Carpet projects along strike to the north, while allowing RTX’s geological team to explore along strike to the south.”