Plooto, yes that is right the 1.8m upfront payment is working capital if you like, to get the ball rolling,
but it is in addition to the 8.05m which is detailed in the table of RDM's Ann. so no need for us to raise capital.
From OZL's Ann. bold text to emphasize
- OZ Minerals has committed to funding $8.05m in exploration and $1.8m in initial cash payments over the first two years. OZ Minerals can earn between 51% and 70% of a project; full earn-in details are available on Red Metal’s website (www.redmetal.com.au).
Unlike our separate Punt Hill JV agreement, RDM will be doing the exploration work, OZL will be supplying the funds in the first 2 years and assistance if required.
From RDM's Ann.
- Red Metal will manage the exploration to the end of the Earn-in Period.
and
- “The projects selected for the Alliance offer a rare opportunity to gain access to large land holdings in terranes with significant mineral endowment and frontier terranes with low cost programs to test new concepts. Many of these areas are under cover and enable OZ Minerals to provide its technical expertise for exploring under cover to support our partner.”
In addition, if after 2 years OZL take up their right to earn in under a JV agreement, RDM gets a further 500k payment for each JV OZL take up.
from RDM's Ann.
Red Metal is also eligible to receive an
additional payment of $500,000 for any project that OZ Minerals ultimately selects for joint venture earn- in.Furthermore, the agreement provides a mechanism whereby
other new projects may be added on broadly similar terms into the future.My underlying thoughts in all this is rather than OZL take out us out which would not happen without RDM's board and major shareholders approval due to their sizeable blocking stake, we are by default if you like OZL's new exploration arm but with the advantage of maintaining a sizeable equity stake in our potential tier 1 assets while still maintaining our independence.
OZL realise what we have, our strategies are aligned so they have secured excellent tenancies with a proven exploration partner before someone else does.
From OZL's Ann.
- Richard Holmes, OZ Minerals Head of Exploration and Growth, said “This Alliance is borne from the experience the companies have gained working together on the Punt Hill project near the Carrapateena copper project, currently in construction in South Australia. Red Metal has demonstrated all the qualities we look for in partners – strong technical ability, a collaborative approach to ventures and external stakeholders, and an entrepreneurial spirit.
Cheers and GLTAH
(20min delay)
