Mining Group (ASX: MNE) is expanding its gold and base metal tenement, as well as its global footprint, with the acquisition of its first offshore project, the Comval Project in the Philippines.
The company exited a trading halt this morning to announce it has signed a binding Heads of Agreement with Cadan Resources Corporation (TSX-V: CXD) to acquire an 80 percent interest in the Comval Project, which is prospective for copper and gold.
This acquisition has the potential to transform the Mining Group, as the Comval Project is located within the East Mindanao Ridge, which is a world class copper-gold province.
The East Mindanao Ridge hosts major deposits such as the 10.3 million gold ounce Kingking, which also contains 5 billion pounds of copper, the 10 million ounce Dilwalwal and the 2.5 million ounce CoO.
The Comval Project’s tenement area covers 4310 hectares, and has had over 24,000 metres of drilling completed.
On completion of the acquisition, Mining Group intends to undertake a comprehensive reinterpretation and review of all available data with a view to designing an infill drilling programme to define a JORC Resource.
Under the agreement, Mining Group will acquire an 80 percent interest in Philco Mining Corporation which holds a 100 percent interest in exploration permits EP1 and EP2, which comprise the Comval Project.
Mining Group will settle the deal via an initial payment of A$1 million to Cadan as a secured loan, pending shareholder approval.
The company will then issue 2.6 million Mining Group shares and a second cash payment of $2 million to Cadan. Mining Group shares were last trading at $0.20, valuing the share issue at $520,000.
On completion of the acquisition, Cadan’s 20 percent interest in Philco Mining will be free carried until Mining Group has spent a minimum of A$48 million on the project.
To fund the acquisition and working capital, Mining Group will undertake a capital raising comprising the issue of up to 15 million shares at $0.20 each to raise up to $3 million.
Mining Group History
Mining Group is a newly listed gold, base metals and uranium mineral exploration and development company with three prospective projects in Western Australia.
The company listed on the ASX at the beginning of July with a positive debut after raising $2.5 million for the exploration of its Western Australian projects, and for the identification and evaluation of complementary projects.
During the September 2011 quarter, Mining Group commenced field exploration at its Boorara and Teutonic Projects.