Galileo enters into agreement to sell Star Zinc to Zambia-focused company
Zinc, copper and rare earths explorer Galileo Resources has entered into a conditional agreement with Siege Mining regarding the ceding of ownership, operation and participation in the Star Zinc project.
For its part, Galileo will cede its ownership of the project for a consideration of $750 000, while its participation will be ceded for $550 000, which includes the handing over of all exploration information which it has in relation to the project.
Completion will occur once the Star Zinc project licence has been assigned to Siege.
Further, Galileo will be paid a royalty on any future sales of zinc from the project, based on the zinc grade. The minimum royalty rate is 3%, increasing by 1% for each $250 increase in the zinc price above $2 500/t, up to a maximum of 10%.
As at March 3, the London Metal Exchange price for zinc was $2 786/t.
Galileo chairperson and CEO Colin Bird says the Star Zinc project is a small but high-grade deposit situated in the expanding outskirts of Lusaka, Zambia, in relative close proximity to housing, schooling and social amenities. “The project lends itself to highly selective mining in a small area and as such is suitable for a small-scale community project involving artisanal mining operations and sorting of ore off-site.”
Galileo entered into the agreement followed a period in which it has, with stakeholders, reviewed the options for putting the project into operation, taking into consideration operational, community and regulatory issues associated with mining a project on the outskirts of Lusaka.
The review also took into account permitting ownership and operational responsibilities to be assumed by a Zambian mining company.
The conclusion of the review was that the project is best operated by a local Zambian mining company, with Siege fitting the bill.
Siege’s principals, including Joakim Chelelwa, have applied for, and are in the process of, being granted the requisite licences within the Star Zinc project area, enabling Siege to conduct mining activities.
Under the agreement, the Star Zinc project will be operated by Siege, as a Zambian community focussed project.
KALAHARI REFOCUS
Following the completion of the sale of its interest in the Star Zinc project, Galileo’s immediate focus will be on exploration activities in Botswana where the company has 15 licences in the Kalahari Copper Belt in highly prospective areas, two of which were the subject of heliborne electromagnetic geophysical surveying.
The miner says the results of the surveying are sufficiently robust, and that Galileo therefore expects to announce the commissioning of an initial reconnaissance drilling programme before the end of March.
The company has also identified two further areas for heliborne electromagnetic geophysical surveying
