Kore Potash plc, the JSE- and AIM-listed potash exploration and development company whose flagship asset is the 97%-owned Sintoukola Potash Project, has completed the purchase of two drill rigs and ancillary equipment from Equity Drilling Limited, to be used for the company’s current DX Pre-Feasibility Study drilling campaign. The acquisition is in line with the company’s strategy to undergo its development plans in a cost-effective manner.
As consideration for the acquisition, 22,000,000 new Ordinary Shares in Kore Potash are being issued to Equity Drilling at a deemed price of 1.225p. An application has been made for these shares to be admitted to trading on AIM and the JSE Limited on Wednesday, 11 December 2019. Following this issue, the Company’s issued share capital consists of 1 537 441 166 shares. No shares are held in treasury. Accordingly, the total number of voting rights in the Company is 1 537 441 166. For ASX purposes, the issue is made utilizing the Company’s placement capacity under ASX listing rule 7.1.
The above figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules. Commenting on this announcement, Brad Sampson, CEO of Kore Potash, said that “in addition to being the most cost effective way to complete the DX Pre-Feasibility Study drilling program this equipment may also be used for any future project development related drilling.”
Although Kore Potash’s flagship asset is the 97%-owned Sintoukola (Kola) potash project in the country, the company is keen to develop its smaller DX project to boost company cash flows. According to a scoping study completed earlier this year, for an upfront capital expenditure of US$327 million, a low-cost mine with a life of 17 years can be established at DX. Production will be 400 000 tones of potash a year, which would generate revenues of US$134 million at a price of $360 per tone.
