Global Li-Ion Graphite Corp. (CSE: LION) has entered into a memorandum of understanding (MOU) with Avana Resources Ltd. to acquire a 100-per-cent interest in Avana's graphite interests in Madagascar; the project comprises three mining exploitation licences totalling 4,375 hectares (10,811 acres) in the vicinity of Andasibe in Toamasina province in Madagascar.
The Madagascar Graphite project has been in operation on and off for the last century and is reported to have produced a combined approx. 18,000 tons of graphite oxide between 1998 and 2008 ( P.G. Ringdahl report 2008 and Wardell Armstrong report 2014) from small private artisanal surface mining operations, after which time the owner/ operators retired. The project's land and operating permits have been kept in good standing and are up to date. A recent draft 43-101 report (Wardell Armstrong 2014) reports "an average run of mine (ROM) of 12% Graphite with first stage onsite flotation producing a 73% concentrate." Both reports indicate the presence of large flake graphite (+80# mesh).
Company President Jason Walsh commented "we are particularly excited to have the opportunity to acquire these advanced assets as we believe we can bring them back into production in fairly short order given their history and infrastructure, providing the requisite economical and technical evaluations support a production decision. We look forward to working with Avana's very experienced team on the ground in Madagascar in our efforts in making LION a leading provider of Graphite Oxide for the rapidly growing energy storage market".
Pursuant to the MOU, to acquire a 100% interest in the Project the Company will make the following cash and share payments to Avana:
US$40,000 within one day of signature of the MOU; (paid) US$100,000 with 5 business days of signature of the Definitive Agreement; US$100,000 within 30 business days of signature of the Definitive Agreement; Euros 200,000 to be directed to certain third parties in respect of an agreement to transfer the Property from the original license holders to Avana; 4,000,000 common shares of the Company within 10 business days of approval by the CSE on the transaction;
Upon the Company achieving an annualized production rate from the Property of at least 5,000 tons of graphite oxide per year as calculated on a monthly basis for at least three consecutive months:
(i) US$1,000,000 in cash or in common shares of the Company; and (ii) The greater in terms of value of either 1,000,000 common shares of the Company or common share of the Company worth US$1,000,000
The Company is confident that working with the Avana team, which has extensive minerals, mining and project management experience in Madagascar will provide LION the necessary skill and expertise to achieve our stated goals.
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