AMN - GOLD: Volt diversifies into gold in Zambia and Guinea

While the Bunyu Graphite Project in Tanzania remains Volt Resources’ flagship and development is being progressed, the company is diversifying into gold with recent acquisitions in Guinea and Zambia.

The ASX-listed company has entered a binding term sheet to conditionally acquire an 85% interest in the Luiri Hill Gold Project in south-central Zambia, 120 kilometres from the capital Lusaka. Luiri is an advanced gold project that has near-term development potential.

The project licences are held by two entities incorporated in Zambia, Cupriferous Resources Ltd and Bukimo Mining Limited, with Volt proposing both will be acquired by an Australian parent entity which is to be incorporated by Volt prior to settlement.

Luiri will be owned 85% by Volt and 15% by the project vendors, who have committed to assist with government and local community engagement using their deep relationship with the local communities and invaluable connection within the Zambian Government.

Consideration for the acquisition comprises:

• The issue of A$3.75 million ordinary fully paid shares on settlement of the acquisition, with the number of shares to be issued calculated based on the 5-trading day volume-weighted average price of Volt securities on ASX in the period immediately prior to settlement; and
• Payment of A$250,000 in cash within 30 days of settlement occurring.

More than US$20 million has been spent to date on the project, including extensive RC and drilling programs, mineral resource reports, metallurgical test-work programs and feasibility studies.

The project also reportedly has existing stockpiles of gold-bearing ore, which the company considers may be material in terms of providing a funding mechanism for the completion/updating of studies to progress to a mining licence, advance any remaining environmental and other approvals and transition to a development decision.

Volt is confident Luiri has the potential to be developed into a medium-scale gold mine in the short term.

Volt chairman Asimwe Kabunga said: “As a shareholder, I am excited about the opportunity for Volt to develop its world-class graphite business in Tanzania combined with the potential to become a gold producer in Zambia in the near future.

“The board is working with the management team to realise our goal to transform Volt into a diversified mineral producer.

“Our Zambian partners in the Luiri Hill Gold Project have the local knowledge and important relationships which can be utilised to add considerable value if the acquisition proceeds.”

With most of the resource near-surface and suitable for open-cut mining, Volt considers there is an opportunity with the current and forecast gold price to reduce the cut-off grade and increase the ounces available for extraction from what has previously been used for the purposes of estimating that mineral resource.

In addition to the Dunrobin and Matala project area, a further 24 gold prospects have been identified within the area of licence as being targets for further exploration.

Volt is also exploring the role Yantai Xinhai Machinery can play in development of the project, considering their arrangement of vendor financing for the previous owners of Luiri and longstanding relationship with Volt as the preferred processing plant constructor for the Bunyu Stage 1 Graphite Project.

Volt has also entered a share sale deed to acquire a highly prospective gold project in Guinea. The project covers 388 square kilometres and comprises six permits in the Siguiri Basin, which forms part of the richly mineralised West African Birimian Gold Belt.

The project is near the Guinea projects of Predictive Discovery from which promising exploration results have recently been produced.

Volt will acquire all the issued shares in Gold Republic Pty Ltd, an Australian proprietary company controlled by Volt chairman Asimwe Kabunga.

Gold Republic is the legal and beneficial holder of all of the issued share capital in each of Norsk Gold Pte Ltd, a registered Singapore entity which in turn is the legal and beneficial holder of all of the issued share capital in Novo Mines Sarlu, and KB Gold Sarlu.

Novo Mines and KB Gold hold 100% of the legal and beneficial interests in the permits.

The Kouroussa and Kouroussa West permits border the recently discovered gold mineralisation announced by Predictive Discovery of up to 46 metres at 6.58 g/t.

Combined with the Fadougou permit, this provides Volt with a strategic landholding in this highly prospective area.

Volt managing director Trevor Matthews said: “This is an exciting opportunity for Volt to acquire a gold project with permits in a highly prospective and under-explored area.”

The consideration for the acquisition includes:

• The issue of 121,718,576 Volt ordinary fully paid shares on completion of the acquisition; and
• A 2% net smelter royalty covering the permit area as well as a 10-kilometre radius from the permit boundaries.

www.voltresources.com