THE BOURSE WHISPERER: New Standard Energy (ASX: NSE) has executed an agreement with Green Rock Energy (ASX: GRK), under which Green Rock will hand over 100 per cent of its interests in the Laurel project in the Canning Basin of Western Australia to New Standard.

New Standard described the Laurel project as a large acreage position in an emerging regional play that is attracting a substantial amount of attention following the recent success of similar projects as that of Buru Energy (ASX: BRU).

Under the terms of the transaction the companies will terminate an Area of Mutual Interest (AMI) agreement involving the Laurel formation across the broader Canning Basin.

New Standard outlined further terms of the agreement that will result in the company retaining a 15 per cent equity interest in EP417 that was due to be transferred under a farm-in agreement with Green Rock.

New Standard will also assume Green Rock’s remaining 40 per cent interest in the immediately adjacent Seven Lakes SPA as a result of terminating the AMI Agreement.

New Standard will now own a 65 per cent operated interest in EP417 (Buru Energy 35 per cent) and a 100 per cent operated interest in the adjacent Seven Lakes SPA acreage.

New Standard’s net acreage position will increase to 1.183 million acres (4,788 square kilometres) across the Laurel formation.

New Standard will pay an upfront cash amount of $1 million to Green Rock Energy with the balance of $650,000 being deferred until either an exploration permit is granted in relation to the Seven Lakes SPA or nine months expires after the execution of agreements.

“This transaction provides us with a meaningful increase in equity levels across our Laurel project acreage and the commercial terms are very attractive when compared to the previous Green Rock farm-out and other comparative transactions on Canning Basin acreage involving the Laurel formation,” New Standard Energy managing director Sam Willis said in the company’s announcement to the Australian Securities Exchange.

“The strategic value of this transaction provides real options for us to progress discussions with interested parties seeking a meaningful exposure to the Canning Basin alongside New Standard as an active operator in the region.

“This continues to build on our major Canning Basin focus involving the prospective Goldwyer and Laurel formations.

“We see large potential upside in the emerging Laurel project as our second project in the Canning Basin and are delighted to have secured this additional equity on these terms.”

New Standard outlined its 2013 work program on the Laurel project will involve the following activities:

–    EP 417 seismic data reprocessing and 2014 drill target selection;

–    Sampling and geological studies;

–    Regional information collation to understand recent Laurel successes; and

–    Seven Lakes SPA acreage retention.

The company said it had designed its 2013 program to refine and de-risk the drill prospects on EP417 ahead of an intended drilling campaign to target Valhalla and Yulleroo style prospects in 2014.

Its primary initial drill targets will be large conventional structures similar to Valhalla and Yulleroo in style.

New Standard anticipates the program will also ensure the most prospective acreage is retained across the Seven Lakes SPA acreage position leading to the application to convert the acreage into a granted exploration permit in the coming months.

New Standard will remain as operator of both acreage holdings following the transaction.

THE BOURSE WHISPERER: Kupang Resources (ASX: KPR) has announced its Kupang Joint Venture (KPR: 55 per cent) in the Indonesian province of Nusa Tenggara Timur in West Timor has obtained the necessary approvals to allow crushing, screening, blending and stockpiling of raw manganese ore at its Kupang processing site.

Approval has been given by the Governor of Kupang to clear and prepare a processing area for site set up and the commissioning of recently acquired processing equipment.

“With this final approval now in place the Kupang JV is poised to ramp up activities towards the commencement of production in the coming months,” Kupang Resources head of operations Simon Youds said in the company’s announcement to the Australian Securities Exchange.

“The receipt of this approval is a credit to all involved, from the Company and its advisors, to the local authorities in Kupang.”

 

Location of Kupang project and local infrastructure. Source: Company announcement

 

Kupang said receiving the final approval meant it can now assemble processing equipment it already has on site once site preparation expected is completed in the coming weeks.

The purchase of locally mined and stockpiled ore by the Manganese Society of Kupang (Mn Society) can now be initiated by the Kupang JV in line with a Supply Agreement the company announced in January.

The Mn Society represents the interests of local manganese miners in Kupang and is currently comprised of 52 members.

Under the Supply Agreement, the Mn Society will, on a best endeavours basis, undertake to procure the supply of a minimum of 30,000 tonnes of raw high-grade ore per month to the Kupang JV.

Kupang expects site establishment and commissioning of the plant will be complete early in the April/June quarter allowing the sale and export of high-grade Manganese ore into the global manganese smelting industry soon after.

“The operations of the Kupang JV will create cash flow to the company, and at the same time provide significant opportunities to the people of Kupang, which is very important to the company and its joint venture partners,” Youds said.

The Kupang JV signed a formal Joint Operation Agreement in February for access to the port facilities for the export of manganese by direct ship loading from the wharf.

The JV’s ship loading equipment can utilise the facilities to export in the region of 80,000 tonnes per month of processed manganese oxide from the deep water port.

The Joint Operation Agreement allows for five days per month priority loading to a shared wharf at the deep water Tenau port in the Kupang harbour.

The facility is capable of taking vessels up to the Handymax 55,000 tonnes size and is provided to the Kupang JV for the period during which a permanent manganese only export facility is being constructed and funded by a third party at the port adjacent to the Kupang Port manganese stockpiling facility.

Once constructed, the Joint Venture’s manganese loading operation intends to move to the new facility freeing up the general cargo wharf.

THE BOURSE WHISPERER: Blackthorn Resources (ASX: BTR) has received good news from its Joint Venture partner Glencore International.

Glencore has indicated it will provide an additional US$80 million in equity funding to complete construction and commissioning of the Perkoa zinc project in Burkina Faso and fund projected costs until the project becomes self-funding.

The previous funding package for the expanded Perkoa project totalled US$140 million and comprised:

–    US$50 million in direct project equity provided by Glencore;

–    US$70 million in two project loans provided by Glencore; and

–    US$20 million working capital facility provided or arranged by Glencore.

Blackthorn has reached a new agreement with Glencore it says will cover funding required to complete the commissioning of the Perkoa project.

Additional funding of up to US$80 million will be provided by Glencore, which consists of approximately US$40 million to cover increased construction and commissioning costs and US$40 million to cover working capital and additional capital requirements up to 31 December 2013.

Under the new arrangement, Blackthorn has elected not to fund its share (US$35 million) of the US$80 million capital requirement and will instead undertake a strategic selldown/dilution of its interest in the project from 39.9 per cent to 27.3 per cent.

“We are extremely pleased to have reached this position with our joint venture partner Glencore in a prompt and commercial fashion,” Blackthorn Resources managing director Scott Lowe said in the company’s announcement to the Australian Securities Exchange.

“The terms on which Blackthorn Resources’ economic interest in the Perkoa project will be adjusted through the strategic sell-down/dilution reflects an agreed fair market valuation of what is a high quality near-to-production zinc-lead-silver asset.”

Blackthorn said the new agreement with Glencore provides it with a number of benefits, such as not being required to raise capital for the Perkoa project.

The deal also means Blackthorn maintains a material economic interest in the Perkoa project while preserving cash raised from a 2012 capital raising, which had been undertaken to progress the 100 per cent-owned Mumbwa copper project in Zambia.

“Over the past year and a half, the exploration success we have enjoyed at the Mumbwa project has resulted in Mumbwa becoming Blackthorn Resources’ flagship asset,” Lowe said.

“The capital raising we undertook last year was designed to allow us to accelerate our study work and ongoing exploration around this exciting copper project.

“The commercial outcome we have reached with Glencore will allow us to continue to develop the Mumbwa project while we maintain a meaningful equity position in the Perkoa project.

“For a company of Blackthorn Resources’ size and profile, we believe this is an appropriate balance to maintain.”

THE BOURSE WHISPERER: Dart Mining (ASX: DTM) has tied up a cash injection of $10 million from US-based institutional investor RK Mine Finance (aka Red Kite).

“Dart Mining has worked closely with Red Kite through a detailed due diligence process which involved a site visit by Red Kite’s investment team and its appointed experts.

“The due diligence included a thorough review of the mining methodology, plant design, geological model, environmental impacts and the financial assumptions underpinning the Unicorn scoping study,” Dart Mining managing director Lindsay Ward said in the company’s announcement to the Australian Securities Exchange.

Red Kite has agreed to purchase up to a 3 per cent Net Smelter Royalty in Dart Mining’s Unicorn project for cash of $8.5 million and to inject new equity of up to $1.5 million.

Red Kite’s investment into the Unicorn project and Dart Mining will be made in two tranches.

The first tranche will involve the purchase of a 2 per cent Unicorn project royalty for $4.5 million and the subscription of $0.8 million for new Dart shares at a 10 per cent premium to 20 day VWAP.

The initial investment is subject to FIRB approval, which Dart Mining said it expected to receive in April.

Dart Mining said it anticipated the first tranche of Red Kite’s investment in the Unicorn project and the company will be received by 30 April 2013.

The second tranche of Red Kite’s investment involves, in practical effect, an option to purchase an additional 1 per cent Unicorn project royalty for $4 million and to subscribe $0.7 million for further Dart Mining shares.

The second tranche is subject to Red Kite being satisfied certain milestones at the Unicorn project have been met; e.g. demonstrated progress of pre-feasibility studies.

These conditions are expected to be met by 31 October 2014.

Dart said it was confident the conditions set by Red Kite for the second tranche can be met well in advance.

“Red Kite’s agreement to make a substantial investment in two tranches is a real vote of confidence in the Unicorn project,” Ward said.

“It will not only enable Dart Mining to accelerate the feasibility and approvals process, but it also sends a strong message to other potential Unicorn cornerstone investors and off-take partners that will be needed as Dart Mining moves forward with the project.”