Kazera Global (KZG ) said it has secured interest from a second potential investor which moves it closers towards securing funding for the development of the Tantalum Valley mine.
To date, Kazera said it has been in ‘well advanced’ discussions with two potential end users of Tantalum, both of which have been impressed by the assay results, it noted. The group‘s intention is to conclude a long-term supply contract with at least one of these end users.
The investment company highlighted to investors that its previously disclosed investor still remains interested in providing a package of €9,130,000, which will fund the development of the Tantalite Valley mine ("TVM") as well as the building of the Orange River pipeline.
In this morning’s statement Kazera highlighted that a second investor, namely a ‘reputable local Namibian investor’ on whom the company has undertaken outside due diligence, has agreed terms to subscribe $11 million for 290,576,383 shares in Kazera, it told investors.
Kazera said it will conclude a transaction with the first of these investors who is able to deliver the funds. The investment will mean that TVM is completely funded, including the construction of the Orange River pipeline, while funding would also enable Kazera to accelerate development of the Diamond and Heavy Mineral Sands opportunities.
In addition this morning’s news of a second potential investor, Kazera told investors that it has appointed Dennis Edmonds, the Director responsible for the company’s Alexander Bay activities, as Joint Chief Executive effective from 3 June 2021, ‘given the importance of the South African activities and the considerable constraints on travel caused by Covid.’
Shares in Kazera Global have increased by nearly 20% in value since the beginning of 2021. The stock was trading 5.08% higher this morning at 1.55p following the announcement.
At TVM, the mine's operator DJ Drilling has now repaired the road systems around the mine after a period of severe weather. It will now begin moving earth for the government approved Tailings Dam, which will recover around 20% more water from the plant waste materials.
Kazera said it has completed negotiations with a Namibian business to supply a 40,000-litre diesel tanker on site that will operate using a monthly consignment model, invoicing only what is used.
Meanwhile, at Kazera’s South African Diamond Mine, production remains ongoing, with several batches being sent to auction since the acquisition of Deep Blue Minerals.
With production increasing and focusing on larger carats, Kazera said it believes that the Diamond Mine will shortly be cash flow positive for the Mine and the business as a whole.
It said negotiations with the government in regard to its Heavy Mineral Sands interests are progressing well, with the Government now requesting that the Company take the next step of posting Notices which advise the local community of its Mining Permit application.
Kazera said these notices have now been distributed with initial feedback from the local community being ‘very positive’. The group said it expects that the application for a prospecting licence will soon ‘follow the same path.’
Larry Johnson, Kazera’s Joint Chief Executive Officer, commented: "Our focus remains on finding a financial solution for the creation of the Orange River pipeline, which, once completed, will support the restarting of production from our Tantalite Mine.”
He added, “Whilst we await completion of one of these financing solutions, DJ Drilling and Kazera have turned our attention to making sure that the Mine is ready to restart operations and that our road networks and equipment currently on site are ready."
Looking ahead, Kazera expects to see its Diamond Mind in South Africa becoming cash flow positive while it told investors that progress for its mining permit “is also very exciting.”
“Both of these opportunities add significantly to the value of our Company and from which we can look to deliver growth to shareholders,” added Johnson.
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