Xtract Resources signs joint venture agreement for Mozambique project

20th Oct 2015 09:01

(ShareCast News) - Shares in Xtract Resources edged higher early on Tuesday after the resource assets developer signed a joint venture agreement for a project in Mozambique.The group said the deal with Mineral Technologies will remove "significant overburden" at its Manica project, where Xtract is currently preparing a bankable feasibility study for a larger open pit mine.Under the terms of the joint venture agreement, half of the 32,000 ounces Xtract plans to mine from the site will be attributable to the London-listed company.In a statement released on Tuesday, Xtract added start-up costs are estimated to be approximately $1.2m, with Mineral Technologies set to foot the transport costs, while Xtract will assume operating costs once the plant is on site.Initial estimates show the operation will deliver an internal rate of return of 68%, Xtract said, adding it expects the project to go into production within the next six months.Xtract shares were up 5.10% to 0.257p at 0923 BST on Tuesday.