South Boulder Mines Ltd (“South Boulder” or the Company”) is pleased to announce that it has entered into a joint venture agreement with TSX listed Strata Minerals Inc. (TSX-V:SMP or “Strata”) on the non-core Cardabia Phosphate Project in Western Australia.
During the deal South Boulder has received $200,000 in cash and Strata has been granted TSX Venture approval on the 13th February 2012 for the Cardabia transaction. 2.5 million fully paid Strata shares will be allotted and in return Strata has acquired an 80% interest in the project.
Further, South Boulder retains a 20% free carried interest through to the completion of a bankable feasibility study (BFS).
The company states that the project divestment allows South Boulder to further focus efforts on the expedited development of the Colluli Potash Project in Eritrea and continue transitioning the Company into a potash producer.
The Cardabia Project is comprised of exploration tenement applications E08/2359, E08/2322, E08/2301, E08/2302 and E08/2303 which cover a total area of ~1,600km2.
It is located ~ 1,000km north of Perth and ~ 80km south of the town of Exmouth. Historical work conducted at the Cardabia Project in the late 1980’s defined widespread shallow nodular phosphate in air-core drilling.
The agreement allows for Strata to own an 80% interest in the project and to sole fund all exploration through to the completion of a BFS.
Lorry Hughes, Managing Director of South Boulder stated, that South Boulder Mines has been looking for some time to unlock value for our shareholders in some of its non-potash fertilizer assets, which tend to be overshadowed by the magnitude and potential of the flagship Colluli Potash Project in Eritrea.
He explained that the agreement allows for the Cardabia project to be explored by an experienced phosphate company at no risk or cost to South Boulder. The Managing Director underlines that the joint venture agreement with Strata will create value for South Boulder shareholders.
/CE