Alecto Minerals has signed non-binding heads of terms for a strategic alliance with Centamin Egypt in Ethopia.
At 1.3p a share, up 0.35p, Alecto is valued at £4.66m. Centamin is investing £250,000 in Alecto at 1.6p a share.
The deal will enable Centamin to diversify away from Egypt. The two companies will select suitable targets for a joint venture.
Alecto has two exploration licences in the prospective greenstone belts of Ethiopia. These are at Wayu Boda and Aysid Metekel. Alecto believes that the deal will enable the Wayu Boda gold project to be advanced rapidly. Centamin wants Wayu Boda, which is near to the Lega Dembi mine, in the joint venture and it would spend an initial $1.8m on the project in order to earn 51% and a further $6m to take the stake to 70%.
If Aysid Metekel goes into the joint venture then Centamin will spend $1.2m for the 51% stake and $5m to increase it to 70%. The project is 80km from the Fiti skarn gold deposit.
Alecto also has interests in Mauritania.
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