Key points
- Chatham Rock Phosphate’s subsidiary Avenir Makatea Pty. Ltd. agreed to sell four mining and exploration leases, including ML100379, EPM 28589, EPM 28882 and EPM 28178, to Australia’s Marshall Group.
- The sale includes a cash payment of $4.1-million (Australian) on transfer of the leases.
- AML will also receive a royalty of $10 (Australian) per tonne on the first 190,000 tonnes of production, worth up to $6-million (Australian), plus a further royalty on production after that threshold until March 31, 2040.
- The transaction is conditional on due diligence expected to be completed by March 31, 2025, a definitive purchase agreement, and TSX Venture Exchange approval if applicable.
Chatham Rock Phosphate Ltd. has agreed in principle to sell to an arm’s-length Australian entity (the Marshall Group) the four mining and exploration leases in respect of its Korella North and South properties currently held by its 100-per-cent-owned subsidiary, Avenir Makatea Pty. Ltd. (AML).
The leases to be sold are ML100379, EPM 28589, EPM 28882 in respect of Korella North and EPM 28178 in respect of Korella South.
The sale price includes a cash payment of $4.1-million (Australian) ($3.65-million (Canadian)) ($4.5-million (New Zealand)) on transfer of the leases to the acquiring company and a royalty to be paid to AML at a rate of $10 (Australian) per tonne for the first 190,000 tonnes of production (total $6-million (Australian) ($5.34-million (Canadian)) ($6.6-million (New Zealand)). A further royalty of $1-million (Australian) will be paid per tonne to AML on all production commencing after the completion of the first 190,000 tonnes up until March 31, 2040.
The transactions are conditional on a successful outcome in respect of a due diligence process to be undertaken by the proposed purchaser, which is currently under way and expected to be completed on or before March 31, 2025, as well as the successful negotiation of a definitive purchase and sale contract, and TSX Venture Exchange approval, if applicable.
