Oriole reports progress on funding Cameroon project
11th Apr 2023 12:19
(Sharecast News) - West Africa-focussed exploration company Oriole Resources updated the market on its five Eastern CLP licences in central Cameroon on Tuesday, as part of the wider Central Licence Package (CLP).
The AIM-traded firm has a 90% interest in the Eastern CLP licences, including Tenekou, Niambaram, Pokor, Ndom, and Mbe, which together form the 'project', and expected to increase its ownership to 100% after resource definition.
It said that, to enable project-level investment, Oriole would transfer its interest in the Project into a sub-holding company named NewCo.
That move would help the company to advance exploration at the project, and minimise equity dilution for shareholders at the company level.
Oriole said it had signed a letter of engagement with a Canadian investment banking firm to secure $1m of project-level exploration financing in return for a 10% non-carried interest in NewCo.
The investment would be used exclusively for gold exploration, funding the firm's proposed work programme on the project, and allowing the company to pursue other funding opportunities to further lithium exploration within the CLP.
Oriole said the financing deal was expected to be closed in the second quarter, subject to finalisation of terms and securing of funding.
Although Oriole had engaged an adviser, the board warned that there could be no assurance that financing would be obtained.
"The Eastern CLP licences were granted for their first term in February 2021," Oriole's board explained in its update.
"Work to date has identified multiple two-to-three kilometre-long gold-in-soil anomalies across the project, in addition to a 12.5 kilometre-long zone of anomalism at Mbe.
"Follow-up rock-chip sampling at Mbe recently returned up to 134.1 grams of gold per tonne from a cross-cutting structural corridor that extends over a strike length of three kilometres, and over a width of at least 70 metres."
At 1136 BST, shares in Oriole Resources were up 8% at 0.14p.
Reporting by Josh White for Sharecast.com.