Gladiator Resources to finalise Zeus acquisition following Likuyu North uranium resource estimate

Uranium and gold explorer Gladiator Resources (ASX: GLA) has called an extraordinary general meeting to seek approvals relating to its acquisition of Zeus Resources, which recently delivered a JORC mineral resource estimate for the Likuyu North uranium deposit in Tanzania.

Work to firm up the resource estimate had occurred in parallel with Gladiator’s plans to acquire Zeus, which is subject to final regulatory approvals.

The proposed meeting will seek shareholder approval to amend the timing around the issuance of milestone shares as part of Gladiator’s share purchase agreement with Zeus.

Likuyu North resource estimate

Located within Zeus’ flagship Mukuju uranium project, Likuyu North has been estimated to hold a total of 7.7 million tonnes grading 267 parts per million uranium oxide containing 4.6 million pounds of uranium oxide using a 100ppm cut-off.

The estimate includes an indicated resource of 3.1Mt at 333ppm uranium oxide for 2.3Mlbs of contained uranium oxide, all within 140m of the surface.

According to Gladiator’s announcement last week, the resources lie within a conceptual pit shell with mineralisation extending beyond the pit along strike and down dip.

The estimate was based on 27,225m of air core and diamond drilling completed in 2011 and 2012 by previous permit holder Uranex. No further field work has been carried out at Likuyu North since 2012.

Gladiator chairman Ian Hastings described the work as an important step in the company’s planning.

“Gladiator looks forward to an exciting exploration future in Tanzania and will now look to the next phase of the projects development, which will build on the resource and which it believes represents an outstanding value add opportunity,” he said.

Further work

The mineral resource estimate was prepared by the MSA Group, which is now working to identify new targets for surface exploration and drilling during 2022.

This work includes the compilation and interpretation of all existing data, including airborne radiometrics, drilling and geological mapping data.

MSA had recommended that shallow (up to 50m) drilling should be carried out to provide samples for laboratory analysis for the resource estimate above the water table with the aim of converting it to the indicated category.

Zeus acquisition

Zeus will become the wholly-owned subsidiary of Gladiator once final regulatory approval is received from the Tanzanian Fair Competition Commission (TFCC) and Mining Commission.

Gladiator entered into a share purchase agreement last September to acquire 100% of the issued share capital of Zeus. The company also inked a services agreement with Zeus managing director Peter Tsegas to issue milestone shares on the achievement of certain outcomes.

Under the share purchase agreement, Gladiator agreed to issue Zeus vendors, on a pro-rata basis, a total of 6 million shares as consideration for the acquisition. The deal was subject to certain conditions precedent which have been met, save for the stamping of the share transfers.

Under the services agreement, Gladiator agreed to issue a further 24 million shares to Zeus vendors upon the satisfaction of certain milestones in three tranches: the formal grant of tenement applications; the completion of a positive desktop study, including evaluation of all available tenement information; and the identification of drill targets in each tenement based on pitting, trenching and sampling results.

At Gladiatior’s annual general meeting in November 2021 shareholders approved the proposed issue of the consideration and milestone shares within three months. However, the milestones were not met within that three-month period due to delays in receiving regulatory approvals in Tanzania. As a result, Gladiator is now seeking to refresh the shareholder approval to allow it to issue the milestone shares as they fall due.

Zeus holds seven uranium exploration licences covering more than 1,764 square kilometres in Tanzania, comprised of the Minjingu project in northern Tanzania and Mkuju, Liwale, Foxy and Eland in the south.

The flagship project is Mkuju, containing Likuyu North, followed by the Minjingu project, which in addition to uranium is prospective for phosphate, rare earths and gold.

At Minjingu, Gladiator said a pitting program and sampling from a nearby phosphate mine will be undertaken with assays expected to be used to prepare a full exploration program. The company said potential exists for intervals with higher grade zones hosted by the extensive phosphate layers at Minjingu.

In its recent March quarterly report, Gladiator said it has already appointed three directors to the Zeus board of five and will continue to fund Zeus to complete the activities underway at Minjingu and Mkuju.

Australian assets

In addition to its uranium assets, Gladiator holds three gold projects in Australia including Marymia in Western Australia and Rutherglen and Bendoc, both of which are in Victoria.