New Age Exploration Ltd has sold its Lochinvar coking coal project on the England-Scotland border to Paladar Trading Ltd.
STRATEGIC
NAE, which last year announced it was in talks for a deal, signed a binding share sale agreement for 100% of the issued capital of its wholly owned subsidiary Lochinvar Coal Ltd.
Lochinvar holds contiguous licences within Lochinvar South, Lochinvar and Lochinvar North on land that stretches from Gretna to Canonbie in Dumfries and Galloway.
The company said that the sale would allow it to focus on advancing its gold and lithium projects in Western Australia and New Zealand.
Palader will pay a nominal AS$1.00 on a completed sale, with settlement subject to conditions precedent including regulatory and shareholder approvals.
On completion, Lochinvar will grant NAE and its successors, and permitted assigns forever, a A$1 per tonne royalty payable on the first 15 million tonnes of any minerals, ores or concentrates extracted from the licences.
NAE said that the parties intended to enter into a definitive royalty agreement at completion of the sale.
Executive director Joshua Wellisch added: “We are pleased to announce the sale of Lochinvar Coal Limited, a strategic move that positions NAE to potentially earn up to A$15 million in royalties from future coal production at the project, subject to the successful development of the project by Paladar.”
In 2022, NAE’s commissioned review of a 2014 scoping study, revised in 2017, showed that the project remained “commercially robust“.
Incorporated in 2019 and based in London, Palader focuses on mining of other non-ferrous metal ores.
The company’s secretary and sole director is British trader Gareth Sharp, residing in South Africa.