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Red Rock enters into JV with Cobalt Blue

By BFN News | 01:19 PM | Tuesday 26 September, 2017


Red Rock Resources has announced that the Company has entered into a conditional agreement with Cobalt Blue to acquire an interest in a Joint Venture company ("JVCo") to be newly formed for the exploitation of four or five copper/cobalt tailings near Kolwezi in the Democratic Republic of Congo. Highlights: - RRR has made a non-refundable payment of $50,000 for the right to enter into the Agreement - RRR has 40 days for due diligence and an exclusivity period of 45 days - In the event that RRR elects to proceed with the transaction following due diligence and fulfilment or waiver of the conditions, it will acquire 26.25% of JVCo for: -- Cash payment of $700,000 --£490,000 payable in RRR shares ("Shares") at 0.65 pence a share, with attached 5 for 3 three year warrants to subscribe for new Shares at 1p ("Warrants") -- Commitment by RRR to fund $1.2m of exploration expenditure over 18 months to produce a bankable feasibility study ("BFS") on Kamirombe, and thereafter pro rata. - JVCo will hold the rights to exploit the Kamirombe 1 and 2, Haute Kalumba, and Basse Kalumba tailings properties (the "Project"). - The local partner, Vumilia Pendeza SA,("VUP") in JVCo will have a 20% interest in JVCo carried through BFS and finance-carried to production, and a 1% net smelter return ("NSR") royalty. - Following completion of the BFS, RRR will have six months within which to elect to pay $1m to farm in to a further 26.25% of JVCo, bringing its interest to 52.5%. Andrew Bell, Chairman of Red Rock comments: "The old, rich copper/cobalt mines on the Congolese part of the Copperbelt have been producing for many decades, and some of the tailings are known to be attractive targets at today's prices and with today's technology. The electric car revolution is expected to have transformative impacts on battery technology and the metal demand pattern. We expect copper to be a beneficiary, but the long term impact on cobalt demand is likely to be stronger. This is an opportunity that can add much value to Red Rock. From a technical point of view, this is a potentially low risk and high cash flow project, and we expect to have geologists on site conducting testwork within days. We are in discussion with other parties who may wish to join us in this project, and will look for opportunities to strengthen the team. A project of this scale will require a dedicated and experienced management, and this we will put in place." At 1:19pm: (LON:RRR) Red Rock Resources PLC share price was 0p at 0.78p Story provided by StockMarketWire.com

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