Galileo Resources PLC (AIM:GLR) said it entered into an option and joint venture agreement covering the Shinganda copper-gold project in central Zambia.
The agreement gives Galileo the right to earn an initial 51% interest in the project, subject to any necessary Zambian regulatory approval, by spending US$0.5mln (£0.4mln) on exploration and evaluation over two years.
Galileo can subsequently increase its interest by entering into a joint venture to develop a mining operation. It can boost its interest to between 65%, for a deposit of greater than 1 million tonnes of contained copper equivalent, and 85%, for a deposit of less than 200,000 tonnes of contained copper equivalent.
"This project fits the Galileo model in that the licence areas have good copper and gold intersections from previous campaigns,” said Galileo chairman and chief executive Colin Bird. “The agreement gives us the opportunity for new deposit discovery and/or small mine production potential.”
“We look forward to working on this project commencing early in the New Year."
The project area covers part of a major 10km structural trend with two previously developed small-scale open pit copper-gold mines. Very limited historic drilling on the property is reported to have intersected 1.07% copper over a true width of 28.3 metres at shallow depth.
Galileo plans to review past exploration data and then conduct a drilling programme to test the shallow copper/gold mineralisation indicated by previous drilling and nearby mining.
Galileo signed the agreement with Garbo Resource Solutions Ltd, a private special purpose UK company set up to hold the Shinganda property.