Mining company Challenger Exploration (ASX: CEL) is set to acquire the remaining 75 per cent stake of their Hualilan Gold Project in Argentina with the aim to own 100 per cent of the project.
The company had rights to move to a 75 per cent ownership of the Hualilan Gold Project by the completion of a Definitive Feasibility Study (DFS) and the issue of 50 million CEL shares. Acquiring the final 25 per cent of Hualilan, which was not covered by the original acquisition agreement, will involve the issue of 64 million CEL shares and US $3.69 million in cash.
The Hualilan Project is located in a Tier 1 jurisdiction. The project consists of 15 mining leases and an exploration licence application covering the surrounding 26km. Hualilan has extensive historical drilling with in excess of 150 drill-holes dating back to the 1970s.
CEL Managing Director Mr Kris Knauer said, "I am pleased to deliver on our commitment to acquire 100% of our flagship Hualilan Gold Project. The consolidation of 100% of the Project simplifies our capital structure and significantly increases the value proposition of the Company for investors. We also see it as a vital first step on the path to production."
The completion of the move to 100 per cent is subject to shareholder approval to issue the 64 million shares. The miner intends to call a general meeting that will include a resolution to approve the issue of these shares as soon as practicable.
Shares in Challenger Exploration (ASX:CEL)
closed at $0.30 yesterday.