Armadale Capital Plc agreed to form a joint venture with African Mining Services Pty. Ltd. on the Mpokoto gold project in the Democratic Republic of the Congo.
Under the heads of agreement, African Mining can earn an initial 25% interest in Armadale subsidiary Kisenge Ltd., which holds the project, by providing US$1.3 million in funding, and up to an 85% interest by funding the project to commercial production.
A definitive feasibility study completed on Mpokoto earlier this year estimated US$25 million in CapEx to bring the property into production, which is targeted in late 2017.
Mpokoto hosts indicated and inferred resources containing 678,000 ounces of gold within 14.58 million tonnes grading 1.45 g/t of gold and is expected to produce about 25,000 ounces per year for nine years.
The African Mining geological team plans to conduct a detailed review at the site over the coming weeks, aiming to fast track Mpokoto toward production.
Armadale noted that having a partner managing Mpokoto enables the company to focus on its high-grade Mahenge Liandu graphite project in Tanzania. Drilling recently kicked off at Mahenge Liandu, focused on developing an initial resource.
As part of the company's new strategy, Peter Marks and Justin Lewis stepped down as Armadale directors, effective immediately.