In its results for the first half of the year, executive chairman Louis Coetzee said the company had “hit the ground running” since acquiring the Haneti Nickel Project in Tanzania at the end of 2018.
Subject to funding, the company is now focused on undertaking an initial drill programme at two key targets, Mihanza Hill and Mwaka Hill, to ascertain the existence of disseminated or massive sulphide mineralisation and define a future larger-scale drilling programme.
As well as indicating the potential for nickel sulphide, work to date has identified the potential for lithium and rare earth element mineralisation, which Katoro investigating; to this end, we have applied for five additional exploration licences in the immediate area.
The company recently agreed to sell its Lake Victoria projects in Tanzania to focus on the Haneti project; assuming the sale goes through, the directors are confident the company has adequate financial resources to continue in operational existence for the foreseeable future.
In the period under review, the company accrued no revenue and made a loss before tax of £433,181, versus a first-half loss in 2018 of £152,279.
Katoro currently has an unrestricted cash balance of roughly £36,000, which is sufficient into October 2019; it expects to receive US$50,000 from LVG, the buyer of the Lake Victoria projects, by 27 September, which will give it sufficient funds to continue operating into the early part of next year.
In order to conserve the company’s cash, the board members have agreed to defer the receipt of salaries until such time as the coffers have been sufficiently refilled to allow the resumption of payments.
"As we have highlighted in various announcements throughout the period, Katoro's evolved strategy is to develop a portfolio of assets focused primarily on the battery metals arena. With this in mind, the agreement with LVG regarding the proposed sale of Reef Miners is an important step for the company in our advancement of this strategy,” Coetzee said.
“We remain confident in the potential of Imweru and feel that LVG has the ability to fully realise this potential. The proposed disposal will allow us, at our sole election, to maintain equity exposure and royalty income to the potential short time to revenue of Imweru, whilst also freeing up our resources to focus on the development of Haneti.
"We believe that Haneti is a strong platform from which we can grow our battery metals portfolio. We anticipate further developments in the coming year and I look forward to updating shareholders on developments in this arena in due course,” he added.