PERTH (miningweekly.com) – ASX-listed Cradle Resources has reached an agreement with Africa-focused Tremont Investments to fund its Panda Hill niobium project, in Tanzania, to beyond the definitive feasibility study (DFS) stage.

Under the terms of the agreement, Tremont would earn up to a 50% interest in the Panda Hill project by investing some $20-million. The Tremont interest in the project would be acquired through a share subscription in a newly incorporated company called Panda Hill Tanzania, which would hold the rights over the Panda Hill project.

Tremont would subscribe the first $5-million within the next 15 business days, and could elect to make subsequent subscriptions of $5-million each.

“Cradle is very excited to introduce an investor of the caliber of Tremont to assist in the development of the world-class Panda Hill niobium project. Having spent the last four months conducting extensive due diligence, Tremont’s $20-million commitment is a positive reinforcement of the quality of the project,” said Cradle MD Grant Davey.

He pointed out that the DFS for Panda Hill would likely be completed once Tremont has invested some $15-million, with any additional subscription made going towards project development.

The newly formed Panda Hill Tanzania would pay Cradle 7.5% of the funds subscribed by Tremont as partial reimbursement of previous development expenditure.

Cradle was also working on additional smaller funding, at parent company level, to pay existing creditors and to provide a working capital buffer. The raising would likely be completed along with the Tremont subscription.

The Panda Hill project currently has a mineral resource of some 56-million tonnes, grading 0.5% niobium, for 280 000 t of niobium pentoxide. The project is covered by three granted mining licences totaling 22.1 km², with the licences due for renewal in November 2016.