Moho Resources Ltd has executed a binding Sale and Purchase Agreement for the sale of the Empress Springs Project in Western Queensland for total consideration of up to $1.258 million.
The agreement with Qld Aus Graphite Pty Ltd (QAG) will see Moho receive an initial cash payment of $258,000 upon completion with an additional $1 million payable as a deferred cash payment 12 months following completion.
Net smelter royalty
Importantly, upon completion, Moho will also retain leverage to the project through a 1% net smelter royalty (NSR) with the details to be documented in a formal royalty deed.
Completion of the sale is expected to occur 10 days after the satisfaction or waiver of the conditions precedent.
Empress Springs Project encompasses remote tenements with high exploration costs, which do not align with Moho’s financial strategy and capacity. Furthermore, the administrative obligations have consumed significant time and resources.
Aligns with strategy
The sale of Empress Springs aligns with Moho's strategic objective of realising value from its existing portfolio while seeking new project opportunities that will benefit shareholders.
Moho listed on the ASX in 2018 with the Empress Springs Project Joint Venture with IGO Ltd under which Moho could earn up to a 70% interest in three mineral exploration permits - EPM25208, EPM25209 and EPM25210.
Following an IPO, the company conducted exploration programs that fulfilled the relevant earn-in requirements according to the Joint Venture Agreement.
In addition, Moho staked adjoining tenements (EPMs 27193 - 27200 and EPMs 27816 - 27821), which expanded the land size of the Empress Springs Project.