The UK-based Katoro Gold has decided to cease any further investment in the Trans Namibian Mining & Minerals (TNMM) Iron Ore project in the Karas region of Namibia with immediate effect.
The project comprises four farms owned by TNMM, known as Naruchas, Kanubeb Wes, Kanubeb Oos and Kanubeb.
The JV targeted production capacity of 3Mtpa once all development work is completed.
In a statement issued on Tuesday, Katoro Gold says it sought evidence of the project’s ownership title as part of the conditions attached to the transaction, but TNMM has not been forthcoming.
Katoro Gold says it reserves its rights to pursue recovery of any amounts invested to date from third parties where it is appropriate to do so, albeit the amounts invested to date are very modest given the limited progress achieved.
Katoro Gold entered a binding conditional agreement with TNMM to form a 50/50 unincorporated joint venture in September 2022.
The joint venture sought to continue the development of TNMM’s iron ore project.
The agreement signed on September 20, 2022, provided Katoro with a preemptive right to acquire up to 60% of the total issued share capital of TNMM and the same percentage of all claims on the shareholder loan account against TNMM should the shareholders decide to sell their interest.
Under the agreement, Katoro was required to procure financing for the project’s and JV’s full funding requirements, including the construction and commissioning of a beneficiation plant and auxiliary operations, should the continued development and exploration work provide positive results.
Once the only remaining conditions had been met, the approval of a work programme and associated budget to advance the project to bankability status, the partners agreed to form an unincorporated JV to be held 50% by Katoro Gold and 50% by TNMM.
TNMM was required to make all technical data relating to the properties available to the JV, including but not limited to all geological data, feasibility studies, and geophysical and geochemical data in its possession.
TNMM was further required to provide the JV with customary warranties and undertakings regarding ownership of the properties.
