Karoo Exploration Corp. is pleased to announce that it was entered into a letter of intent pursuant to which it will acquire the Chirundu Project, along with a portfolio of uranium properties, in Zambia, from African Energy Resources Ltd. (ASX: AFR). African Energy is an arm’s-length party, listed on the Australian Stock Exchange, and is a mining development company focused on Botswana and Zambia.
The Chirundu Project will add to Karoo’s existing portfolio of Uranium projects in Africa. The properties are located in the south and northeast of Zambia, and are comprised of the Chirundu, Kariba Valley, and North Luangwa Valley projects. The uranium mineralization at Chirundu and Kariba is hosted by Karoo Supergroup sediments, whereas the North Luangwa Valley mineralization is hosted in feldspathic gneisses of the Karoo basement.
Karoo can acquire the project, and accompanying properties, in consideration for the cash payment of USD$2,000,000, and the issuance of an equity package consisting of shares and share purchase warrants with a value of USD$500,000, priced based on any offering completed by Karoo concurrent with this acquisition.
The acquisition remains subject to certain conditions, including Karoo obtaining financing on acceptable terms, completion of due diligence satisfactory to both Karoo and African Energy, and approval of the TSX Venture Exchange. All securities issued in connection with the acquisition will be subject to a four month hold period. The acquisition cannot be completed until these conditions are satisfied, and there can be no assurance that the acquisition will be completed as proposed or at all.