Galileo Resources PLC (LON:GLR) said it has sold a package of 9 licences in the Kalahari Copper Belt for US$3mln to Sandfire Resources Ltd (ASX:SFR), which is building the T3 copper-silver mine nearby.
It marks a quick monetisation for Galileo given it only acquired the exploration ground in May and October 2020.
Sandfire is paying US$1.5mln in cash and US$1.5mln in shares, plus a contingent future ‘success payment’ of US$10mln-80mln subject to future ore reserve volumes being unearthed across the acreage. At the same time, Sandfire is subscribing for US$1.5mln Galileo shares, at a price of 2.68p per share.
Sandfire is pledging exploration spending of US$4mln on the licences and has first refusal rights over another 15 Kalahari Copper Belt licences that are retained by Galileo.
"This transaction with Sandfire represents a major step forward for Galileo in its Kalahari Copper Belt endeavours,” said Colin Bird, Galileo chief executive in a statement.
“We are pleased to be working with Sandfire Resources, who are an Australian listed company and have an enviable track record of copper/gold discovery, development execution and operation. They have a commanding position in the Kalahari Copper Belt and hence we feel that this arrangement will benefit both parties to further enhance their positions. The transaction allows Sandfire to explore the Included Licences, which are in close proximity to their major mine build, and also allows Galileo to carry out exploration on the Excluded Licences.”
Bird added: “We look forward to implementing the transaction and working alongside Sandfire in a region, where in my opinion, discovery and mine build has only just started."