Bushveld Minerals Limited (LON:BMN) has signed a Memorandum of Understanding for its Mokopane tin project with South African group VBKom.
The consultant will carry out due diligence ahead of a possible agreement to provide capital investment and technical support for the development of the Groenfontein and Zaaiplaats deposits.
A binding deal would see VBKom provide capital and technical support in return for a stake that will not exceed 50%.
The MoU provides for VBKom to conduct due diligence on the Mokopane tin project for a period to 31 January.
A scoping study on the deposits at Mokopane in 2014 indicated an initial 691,000 tons per annum Run-of-Mine operation, producing 700 tons of tin each year to generate a pre-tax return of 34.6% using a long-term tin price of $22 928/ton (current: $21 610/ton). Capital expenditure to build the mine would US$16mln.
Fortune Mojapelo, Bushveld Minerals’ chief executive, said: “The signed MoU, which introduces a credible potential technical and financial partner for the Mokopane tin project.”