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Regency Mines in MoU with Australia’s Direct Nickel over Mambare project development
Regency Mines PLC (AIM: RGM) said it has signed a non-binding Memorandum of Understanding with Sydney-based Direct Nickel Pty Ltd over developing the company’s Mambare nickel-cobalt project in Papua New Guinea.
The company and DNi have agreed to work towards a proposed transaction which will pool Regency's interest in Mambare with DNi's lateritic nickel/cobalt treatment technology in a new company in which both parties will have shares, which will have non-exclusive licensing arrangements for the DNi process, and which will raise funding for the further development of Mambare, including a pilot plant.
DNi would assume the role as project operator in the new company, and both parties would be represented on the board and in the management of the new company.
Both parties have agreed to grant each other a period of exclusivity up to October 1 2009, in which they will not negotiate with or furnish information to any third parties on Mambare or the MoU, and in which Regency will not vary or enter into any material contracts in relation to its operations at Mambare.
Regency has over the past year reviewed the various technology solutions under development applicable to tropical laterites that would reduce capital and operating costs of production. It has concluded that the DNi tank leaching process appears likely to be applicable to the Mambare deposit, that it wishes to assist DNi in advancing this technology, and that if it were to do so successfully, this would be the outcome most likely to maximize Regency shareholder value, it added.
