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Altamin confirms funding deal for Gorno

Wednesday, October 19th, 2022

Base metals developer Altamin has inked a binding subscription and joint venture (JV) agreement with Appian Italy, replacing an earlier term sheet with Appian Natural Resources Fund II to JV on the Gorno zinc project, in Italy.

Under the original term sheet, signed in July, Appian would have invested up to A$94-million to earn a 67.4% interest in the Gorno project.

Altamin on Wednesday told shareholders that under the new JV agreement, the company’s wholly owned subsidiary Energia Minerals would transfer the Gorno project into a newly incorporated Italian JV company known as Verda Metals.

Appian could then invest up to A$103-million to earn a 67.4% interest in Verda.

The payment will be made in two tranches, with the first A$15.9-million in funding securing Appian a near 29.9% interest in the JV vehicle, with the funding to be used on expanded exploration and infill drilling work, as well as permitting and the completion of a definitive feasibility study.

Appian would then have the right to fund a further A$87.3-million for project construction, following a final investment decision (FID), to earn a further 37.5% interest in the JV. The amount will be sized to fund the expected project financing equity component for the Gorno project, and is based on the scoping study parameters.

Following the satisfaction of conditions precedent, Appian will invest an initial A$4.1-million to earn an initial 9.96% interest in Verda, with the remaining first tranche to be drawn by Verda when required.

The two companies will share management of the Gorno project prior to an FID, and Altamin is hoping to retain a 32.6% interest in the project once it has been funded to commercial production.

“This funding and JV partnership positions us to quickly commence remobilisation of our drilling contractor to embark upon the largest drilling programme ever initiated at Gorno,” said Altamin MD Geraint Harris.

“Altamin and Appian share the vision of significant additional resource potential at Gorno and the ability of this mine to make an important contribution to local prosperity and to supply a clean and sustainable source of concentrates for European smelters long into the future. The execution of this funding agreement marks a key milestone confirming Italy as a mining jurisdiction and we are excited to be a contributor to the growing efforts to secure the raw material supply chain in Europe.” 

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