Havilah Resources Ltd (ASX:HAV) and potential Chinese partner Wanbao Mining have extended the exclusivity period relating to the Kalkaroo Copper-Gold-Cobalt Project in South Australia.
The period granted to Wanbao has been extended to June 30, 2018, after it expired on March 31.
This allows for the evaluation process that Havilah began with Wanbao in early 2016 to be brought to an orderly conclusion.
READ: Havilah Resources transitions primary focus to copper with cobalt and gold as value-adds
CEO Walter Richards said: “We are very grateful for Wanbao’s support and commitment to the Kalkaroo copper-gold-cobalt project to date.
“Wanbao has demonstrated its ability and capability as a potential investor in this major project and we are looking forward to receiving its decision and potential investment proposal in the near future.”
Wanbao required to make decision
In return for the extension, Wanbao is required during the period to make a decision as to whether or not to participate in the project and to submit an investment proposal to Havilah.
If Havilah accepts such a proposal it will be the basis of a term sheet to be agreed and executed by both parties before June 30, 2018.
Havilah’s projects are near the mining centre of Broken Hill.
Havilah will evaluate any investment proposal on its merits taking into account the state of the market and the relevant commodity price cycles.
Other development alternatives and opportunities for Kalkaroo will be considered by Havilah after the exclusivity period ends.
Havilah responsible for additional PFS work
The two parties have agreed that Havilah will take responsibility for additional recommended pre-feasibility study (PFS) work from this point forward.
This work can potentially enhance the value of the Kalkaroo project.
READ: Havilah Resources adds cobalt to its South Australian copper-gold project
“I am excited about the opportunity for the Havilah team to take control of the PFS,” Richards said, “and direct the additional work to ensure the PFS reflects a fair and realistic value for the project.
“Significant potential additional value has been identified through the PFS work done to date, and that needs to be incorporated into the PFS”, he said.
Havilah is also preparing an ore reserve statement for Kalkaroo.