Keras Resources stops pursuit of exploitation permit in Togo
Keras Resources, has put a stop to pursue an exploitation permit for the Nayéga Manganese project in Northern Togo. Instead, it is shifting its focus to become a fully dedicated American business.
As part of this shift, Keras will transfer the permit for the Nayéga project to the state-owned Société Togolaise de Manganèse. Additionally the gold mining firm will also provide the state with its intellectual knowledge related to the project. The company will offer advisory and brokerage services to help accelerate the development of the manganese project. Furthermore, Keras will begin the process of liquidating its interest in SGM, the company through which it holds the Nayéga holding.
Agreement
Under the agreement signed with the Republic of Togo, the government will pay Keras $1.7 million in cash on July 17, 2023. Additionally, Keras will receive an advisory fee comprising 1.5% of the gross revenue generated from the Nayéga project over a three-year period.
The state will also pay Keras 6% of the gross revenue generated from the mine for brokerage services over a period of 3.5 years or until 900,000 tons of beneficiated manganese ore have been produced and sold, whichever is lesser.
Furthermore, Keras is considering entering the organic fertilizer market through its ownership of Diamond Creek, an organic rock phosphate mine in Utah, United States. Keras plans to use the cash consideration received from the Togo Government to fund the acquisition of Falcon Isle Resources, which fully owns Diamond Creek. The funds will also be used for general working capital.
The advisory and brokerage fees received from the Togo Government will be used to enhance the Diamond Creek mine, which is reported to be cash-flow-positive. Keras intends to expedite an exploration program at Diamond Creek to establish a National Instrument 43-101-compliant mineral resource and convert the existing mining permit to a large-scale mining permit. The company also aims to complete a granulator plant and conduct research to develop liquid organic products from its existing product streams.
Keras CEO Graham Stacey expressed that this transaction marks the completion of Keras’s transition into a fully focused high-grade organic fertilizer producer in the United States. He mentioned that the agreement reflects the constructive relationship the company has with the state and provides a clear direction for the development of the Nayéga asset to benefit all stakeholders while rewarding Keras for its investments thus far.
