Aim- and ASX-listed Ariana Resources has entered into a strategic investment term sheet with Hongkong Xinhai Mining – part of Shandong Xinhai Mining Technology and Equipment – to provide the company with A$8-million in immediate funding and to conduct a metallurgical sampling and testwork (MST) programme and to progress the definitive feasibility study (DFS) at the Dokwe gold project, in Zimbabwe, which is 100% owned by Ariana.

Xinhai has paid a non-refundable signing fee of A$500 000 to Ariana and the parties are now working towards finalising binding documentation for the strategic investment.

Subject to execution of the definitive agreements and satisfaction of other conditions precedent, Ariana says Xinhai will make an investment worth up to A$11-million into Ariana, whereby Ariana will issue an aggregate of up to 36.67-million Crest Depositary Interests (CDIs) in Ariana at A$0.30 per CDI, subject to Ariana shareholder approval – if required – and any other requirements of the ASX and Aim rules, to Xinhai – or its nominees.

The investment is intended to be made in three tranches.

For tranche one, Ariana says Xinhai will invest A$8-million in cash into Ariana in exchange for 26.67-million CDIs.

On completion of the tranche one investment, Ariana says Xinhai will be entitled to nominate for appointment to the Ariana board one director, with the initial nominee being John Zhang.

For tranche two, Xinhai will provide MST services based on a programme to be agreed for the Dokwe project, valued at A$1-million, to Ariana in exchange for 3.33-million CDIs issued by Ariana.

For tranche three, Xinhai will provide technical services based on a budget to be agreed but nominally valued at up to A$2-million to complete a DFS for the Dokwe project in exchange for up to 6.67-million CDIs issued by Ariana.

All funds received by Ariana pursuant to the investment will be used and allocated by Ariana for general working capital purposes in accordance with its operational and strategic requirements at its sole and absolute discretion.

Ariana says the parties will, separately, at the time of signing the definitive agreements, enter into a technical services agreement relating to the work to be conducted for the MST programme and DFS of the Dokwe project.

Ariana will also grant Xinhai – or its nominees – options on the basis of one CDI option for every two CDIs issued.

Upon completion of tranche one of the investment, 13.33-million options to acquire CDIs at an exercise price of A$0.50 per CDI are exercisable until December 31, 2027.

Upon completion of tranche two of the Investment, 1.67-million CDI options are exercisable and upon completion of tranche three of the Investment, up to 3.33-million CDI options are exercisable.

In addition to the investment, Ariana says it has provided investment and wealth management firm Shaw and Partners the opportunity to raise an additional A$2-million – on the same terms as tranche one of the investment by Xinhai – to respect the existing mandate that Ariana has with Shaw following the successful IPO, and subject to completion of the tranche one investment by Xinhai.

Ariana says confirmation of such additional placement commitment by Shaw will be advised to the market within the next ten business days. The company says there is no certainty that the follow-on placement will proceed.

"We are very excited to be entering into this funding term sheet with Xinhai at this pivotal time for our business. Xinhai has recognised the value of the Dokwe gold project and the exploration and development capabilities of Ariana,” says Ariana MD Dr Kerim Sener.

“In turn, we recognise in Xinhai the opportunity to build a lasting partnership capable of unlocking the value of Dokwe through the acceleration of the feasibility study programme with a view to progressing Dokwe to production as swiftly as possible.

“Xinhai has demonstrated significant capacity to undertake large-scale projects, such as Dokwe, globally, and has a substantial in-country presence in Zimbabwe undertaking a number of projects.

“We look forward to developing our partnership with Xinhai in the years ahead and seeing Dokwe through to production,” adds Sener.

"We are pleased to build a long-term partnership with Ariana Resources through this strategic investment in the Dokwe gold project in Zimbabwe,” adds Xinhai chairperson Yunlong Zhang.

“This initiative represents a significant step in Xinhai's commitment to developing high-quality, long-life mineral assets in emerging resource regions.

“We believe the project holds strong geological potential and aligns with our vision of responsible, technology-driven growth.”