BAT entered into a Joint Venture Agreement with Mozambican Ruby Lda on 20 October 2015 to advance and unlock value the Company’s Montepuez East Ruby Project (“the Project”), in Mozambique. While the project is considered to offer significant prospectivity it not strategically aligned with the Company’s primary focus, which is graphite.
Under the terms of the Agreement, Mozambican Ruby Lda will acquire up to 75% ownership in the Project by funding exploration.
BAT will be free carried for the first US$400,000 of expenditure by Mozambican Ruby Lda, which must be spent within the first two 2 years of the JVA.
Thereafter BAT’s proportional contribution will be deferred until the first commercial sale of rubies (quantifiable by a ruby sale in excess of USD$1 million), and will be repaid from any profits derived from the ruby sales. BAT retains a 25% interest in the Project and any rubies produced.
Mozambican Ruby Lda is proceeding with bulk sampling and geophysics programs together with auger drilling.