London-listed Altona Rare Earths has announced that, further to the exercise of the Sesana copper project option announced on July 29, 2024, it has entered into a final agreement with Ignate African Minerals with respect to prospecting licence PL2329/2023, located in the Kalahari copperbelt, in Botswana.

Following the signature of a binding option agreement with Ignate regarding the tenement on April 9 last year, and the subsequent exercise of the option on July 29, Ignate and Altona have signed a final agreement.

This agreement grants Altona the right to acquire up to an 85% interest in the tenement.

The acquisition will involve payments totalling $110 000 in cash and $250 000 in Altona shares, along with phased exploration, technical and expenditure commitments over four years.

The agreement remains subject to conditions precedent, including the transfer of the tenement to Botswana-registered company Sesana Copper, which is held 51% by Altona and 49% by Ignate shareholders.

“I am very pleased to start 2025 with this significant step forward for the Sesana copper project. The signature of the Sesana copper project final agreement will enable the company to focus on ongoing environmental permitting to enable the start of exploration activities as soon as possible,” Altona CEO Cedric Simonet said on January 27.

Under the terms of the agreement, the payments and expenditure commitments are divided into three phases.

Phase 1, lasting 12 months, involves $50 000 in Altona shares and $100 000 for geophysical surveys and the definition of drilling targets, enabling Altona to earn a 51% interest in the tenement.

Phase 2 spans 18 months and includes payments of $50 000 in cash and $100 000 in Altona shares, alongside $400 000 allocated for initial drilling of at least 2 000 m, allowing Altona to increase its stake to 70%.

Phase 3, also 18 months in duration, requires payments of $50 000 in cash and $100 000 in Altona shares, with $1-million earmarked for preparing a maiden Joint Ore Reserves Committee-compliant mineral resource estimate and a conceptual study, increasing Altona’s interest to 85%.

The share payments for each phase will be priced at the volume-weighted average price (VWAP) for the ten days preceding the relevant milestones. Post the earn-in period, non-funding parties’ interests will be diluted by a standard straight-line dilution formula, and any interest falling below 10% will convert into a 1% net smelter royalty.

Additionally, if a resource of over 20-million tonnes at more than 1% copper equivalent is defined, the original tenement owner will receive a one-off payment of $250 000 in cash and $250 000 in Altona shares, priced at the VWAP for the ten days before the resource statement’s announcement.

The tenement is situated about 25 km from the low-cost Khoemacau copper/silver underground mine and near licences held by Galileo Resources and ARC Minerals.

Recent analysis of regional airborne magnetic data indicated a 10 km stretch of the D'Kar and Ngwako Pan formations contact running through the northern part of the tenement, along the eastern margin of a fold structure. This geological setting is considered ideal for copper/silver mineralisation.

Environmental permitting processes are currently under way to facilitate the start of exploration activities. The initial exploration phase will involve high-resolution geophysical surveys to identify promising drilling targets along the D'Kar and Ngwako Pan formations contact, followed by drilling.