Share Search
Visit the Share Search
Trident Resources acquires iron ore royalty at Koolyanobbing
3rd Jun 2020 12:53
(Sharecast News) - Trident Resources announced on Wednesday that, following its admission to trading on AIM, the Koolyanobbing iron ore royalty acquisition had completed.
The firm explained that on 25 March, it entered into a conditional purchase agreement with FE to acquire a 1.5% free-on-board revenue royalty, covering part of the producing Koolyanobbing iron ore operation in Western Australia, for a staged cash consideration of AUD 7m (£3.83m).
As it said on 27 May, the first quarterly payment attributable to Trident was AUD 0.54m.
As such, the first tranche consideration payable on completion was AUD 3.46m, being the purchase price, less the first quarter royalty payment, which had now been paid.
The second tranche of AUD 3m would be payable 12 months and one day after the closing of the transaction.
Trident said the royalty would be payable on production from the ML77/1259 tenement, which constitutes part of the Deception Pit - one of the segments in the broader Koolyanobbing operation.
The Deception Pit is connected to Mineral Resources' Windarling operation by a 20 kilometre haul road, which was then connected to Koolyanobbing.
Material from Koolyanobbing is transported by rail south to Esperance Port, where it is loaded for export.
The Deception pit has a JORC 2012 reserve of 9.3 million tonnes at 59.9% iron, and a total resource of 19.5 million tonnes at 59.9% iron as at 30 June 2019.
Trident said it estimated that up to 75% of the Deception Pit could contain mineralisation, over which payments would be made under the Koolyanobbing iron ore royalty acquisition.
"We are delighted to announce the completion of Trident's first transaction as a new growth-focused diversified royalty and streaming company," said chief executive officer Adam Davidson.
"The acquisition provides Trident with an immediately cash generative iron ore royalty at a time where iron ore price continues to outperform other commodities and provides a strong initial platform from which to execute on our strategy."
At 1224 BST, shares in Trident Resources were down 4% at 24p.
The firm explained that on 25 March, it entered into a conditional purchase agreement with FE to acquire a 1.5% free-on-board revenue royalty, covering part of the producing Koolyanobbing iron ore operation in Western Australia, for a staged cash consideration of AUD 7m (£3.83m).
As it said on 27 May, the first quarterly payment attributable to Trident was AUD 0.54m.
As such, the first tranche consideration payable on completion was AUD 3.46m, being the purchase price, less the first quarter royalty payment, which had now been paid.
The second tranche of AUD 3m would be payable 12 months and one day after the closing of the transaction.
Trident said the royalty would be payable on production from the ML77/1259 tenement, which constitutes part of the Deception Pit - one of the segments in the broader Koolyanobbing operation.
The Deception Pit is connected to Mineral Resources' Windarling operation by a 20 kilometre haul road, which was then connected to Koolyanobbing.
Material from Koolyanobbing is transported by rail south to Esperance Port, where it is loaded for export.
The Deception pit has a JORC 2012 reserve of 9.3 million tonnes at 59.9% iron, and a total resource of 19.5 million tonnes at 59.9% iron as at 30 June 2019.
Trident said it estimated that up to 75% of the Deception Pit could contain mineralisation, over which payments would be made under the Koolyanobbing iron ore royalty acquisition.
"We are delighted to announce the completion of Trident's first transaction as a new growth-focused diversified royalty and streaming company," said chief executive officer Adam Davidson.
"The acquisition provides Trident with an immediately cash generative iron ore royalty at a time where iron ore price continues to outperform other commodities and provides a strong initial platform from which to execute on our strategy."
At 1224 BST, shares in Trident Resources were down 4% at 24p.