Midas Minerals to fast-track drilling at newly acquired Otavi copper project in Namibia

Midas Minerals (ASX: MM1) plans to hit the ground running at the high-grade Otavi copper project in Namibia after making what it says is a company-changing acquisition.

The Western Australian gold and lithium explorer is acquiring 10 exclusive prospecting licences at Otavi from leading Brazilian base metals producer Nexa Resources.

The project – located approximately 360 kilometres north-east of the capital, Windhoek –covers approximately 1,776 sq km and includes two notable deposits at T13 and Deblin that are awaiting resource definition, along with numerous underexplored targets.

Definition drilling

Midas came out of a short trading halt to confirm the project acquisition and its plans to immediately commence resource definition drilling on known deposits.

The company also reported it is planning regional exploration to test drill-ready targets including soil and geophysical anomalies and outcropping copper mineralisation.

Previous exploration over the past decade has identified multiple high-grade copper deposits, with accompanying silver and gold.

‘Transformational’ acquisition

“Acquiring this project is transformational for Midas, providing us with a highly prospective and advanced project that we can rapidly explore and grow a resource base to deliver value to our shareholders,” managing director Mark Calderwood said.

“The Otavi project provides an excellent opportunity for Midas to delineate significant high-grade copper and precious metal deposits starting at or near surface with favourable metallurgy.”

“Despite multiple high-grade drill intercepts and untested targets, the project area is essentially devoid of prior mining.”

Structured payment

Mr Calderwood noted that Midas had structured the acquisition with a minimal upfront payment equivalent to a fraction of prior expenditure on the project, with any further deferred cash consideration contingent on understanding the potential economics of the project.

Under the material terms of the agreement, Midas will pay approximately $4.68 million in cash on completion of the acquisition.

Midas will make a first milestone payment for the same amount within 10 business days of the company completing a pre-feasibility study, with a second payment for the same figure payable within 10 business days of the company making a decision to mine.

A third milestone payment of approximately $3.1m is payable within 12 months of the commencement of commercial production.