Aim- and TSX-V-listed Altus Strategies has signed a letter of intent with ASX-listed Canyon Resources to terminate its existing bauxite joint venture agreement with Canyon and to transfer 100% of Altus’ interest in the Birsok and Mandoum licences to Canyon.
In return, Altus will receive up to 30-million new shares in Canyon and a royalty of $1.50/t on ore mined and sold from the Birsok project.
Altus already holds eight-million Canyon shares under the existing agreement, which it will retain under the new agreement.
Canyon previously had a right to earn up to 75% interest in the Birsok project.
The Birsok project is located in central Cameroon and is contiguous with exploration licences covering the potentially substantial Minim Martap bauxite deposit, which is owned by Canyon.
“The Minim Martap and Birsok projects are potentially very substantial, having high grades, low impurities and being strategically located adjacent to an operating rail line that runs to the coast.
“We believe that significant potential exists for Canyon to fast-track the mining and export of a premium-grade bauxite product,” said Altus CE Steven Poulton.
He added that Altus’ agreement with Canyon further validates Altus’ project generator business model, generating returns from exploration, while growing a portfolio of potentially high-value royalty income streams.