Kibo Mining and Metal Tiger walk away from joint ventures

Tanzania-focussed mineral exploration and development company Kibo Mining announced on Friday that it reached agreement with its joint venture partner Metal Tiger to cease activities at the Pinewood and Morogoro joint ventures with immediate effect, and relinquish the licences back to the local authorities.

The AIM-traded firm said both Metal Tiger and itself had experienced “considerable success” in respect of certain other projects of their business portfolio, and leading to those other interests becoming the absolute focus of each company.

As a result, the two boards saw it appropriate that both companies focus their efforts, energies and resources on their important core projects and take the steps necessary to reduce non-core investments and activities, including Pinewood and Morogoro, which they said could distract each company from their main commercial purpose.

Both companies jointly confirmed that there were no material ongoing costs to be covered as a result of the cessation of the joint ventures.

Metal Tiger still retained 10 million warrants to subscribe for Kibo Mining new ordinary shares at a price of 9p, with an exercise period until 25 February 2018.

The Metal Tiger also confirmed it would not invest in Tanzania for a minimum period of six although it agreed Kibo Mining may work with other parties to reconstruct a portfolio of uranium interests in Tanzania, should it choose to so do at some point in the future.

“In late 2014 and early 2015 the £0.45m invested by Metal Tiger made a material difference to the financing of Kibo Mining at the time, and we were and are grateful for that support,” said Kibo CEO Louis Coetzee.

“The joint ventures at Pinewood and Morogoro have not progressed as planned … and although unfortunate, this reflects the need to focus investment correctly in smaller companies with multiple projects.

“Our decision is however in perfect alignment with our stated strategy to reduce the company's exposure to early stage exploration projects.”

Michael McNeilly, CEO of Metal Tiger, said both Kibo Mining and Metal Tiger commenced the joint ventures as smaller companies with earlier stage interests.

“Both companies have been fortunate and achieved considerable success in certain projects and it has been necessary to focus time and resources on the areas of our business where the most rapidly advancing progress was possible.

“Given the need for continuing focus for commercial reasons, and reflecting the impact our commercial success would have on the local economies in which we work, it is essential for us to ensure we focus our efforts in the most important areas.”