Ownership, Earn-In and Licensing
The Ondundu Exclusive Prospecting Licence (“EPL 3195”), which allows for base, rare and precious metal exploration, is held by Omatjete Mining Company (Pty) Ltd. (“Omatjete”), a 70% owned subsidiary of Westport Resources Namibia (Pty) Ltd., which is a wholly owned subsidiary of the Company. In February 2015 the MME renewed EPL 3195 relating to Ondundu until February 3, 2017. The licence remains in good standing.
The Company announced on January 14, 2016 an earn-in agreement (“Earn-In”) had been executed with B2Gold Namibia (“B2Gold”) whereby B2Gold can earn up to a 100% interest in the Ondundu Gold Project.
The principal commercial terms of the Earn-In are as follows:
In the first 12 months B2Gold will, as project managers, have the right to acquire 25% of Ondundu for a committed spend of US$900,000;
If B2Gold exercise their first right, in the second 12 months they will spend a further US$1,100,000 to acquire an additional 24% interest in Ondundu (49% in total);
If B2Gold exercise their second right, they may spend a further US$1,300,000 to acquire an additional 26% interest in Ondundu (75% in total) in the third 12 months; and
B2Gold and Forsys may separately exercise a call or put option to transfer the balance of Ondundu for US$8,500,000 after 24 months or 36 months respectively.
Historical Drilling Results
Discovered in 1917, it is located in the Northern Zone of the Neoproterozoic Damara Orogen in north-central Namibia. Ondundu is a sediment-hosted, structurally controlled, mesothermal gold deposit belonging to a family of deposits that includes some of the world’s most significant gold resources including Muruntau (+100m oz), Telfer (+26 m oz), and Kumtor (+4m oz) and locally the Navachab Mine (+4m oz) and the Otjikoto Deposit (+1m oz).
Historical resource of approximately 500 K ounces of gold (4.5 MMt at 3.387 g/t); Goldfields 1989
2,868 surface samples analyzed yield average of 7.7 g/t (historical trenching by Goldfields (Tsumeb Exploration) on the veins and parallel to the veins)
5,583 m of drill samples analyzed yield mean of 8.5 g/t (Goldfields drilling from 1980’s)
Gold mineralization identified along a 2.5 km by 0.5 km ridge protruding approximately 60 m above grade surroundings (due to silicification of host rocks)
Open pitable shallow dipping stratiform deposit
Additional information on the Ondundu Project can be found in the NI 43-101 compliant Technical Report on the Ondundu Gold Project (EPL 3195).
This technical review was undertaken by Donald Boyack, who is independent from the Company and summarizes work undertaken at EPL 3195 to date and sets out the next steps recommended for the exploration of the Ondundu Gold EPL.