Rome Resources Plc has settled a claim with the Mozambique government concerning the expropriation of Mining Concession 4623C. The settlement entails five new licenses for exploration, granting the Company a 30% carried interest. Legacy shareholders may receive benefits through Bonus Preference Shares, although the settlement is non-cash. CEO Paul Barrett reiterated a commitment to ongoing exploration in the DRC.
Rome Resources Plc has reported a significant development regarding a settlement with the Mozambique government, concluding a legacy claim linked to the expropriation of Mining Concession 4623C. This settlement allows for the issuance of five new licenses pertaining to research and exploration, granting Rome a 30 percent carried interest without the obligation of any future costs. Previously, the claim had been perceived as weakened due to purported management failures that led to the expropriation, affecting the potential for a cash settlement.
The new licenses encompass a range of areas, including significant graphite potential and heavy mineral sands, aggregating approximately 59,733 hectares. This area is comparable in size to the Isle of Man, with two licenses slated for immediate marketing to generate returns, while further technical work is required for the remaining licenses. The agreement with Luangwa Resources will secure Rome a 30 percent interest in these licenses, yet Rome will not contribute to exploration costs.
Legacy shareholders are set to benefit from the outcome of this settlement through the issuance of Bonus Preference Shares, allowing them to receive preferential dividends based on any damages awarded. Nevertheless, the non-cash nature of the settlement may not meet all shareholders’ expectations. Rome intends to collaborate with Luangwa to capitalize on the value of the new licenses and distribute cash dividends based on net proceeds after expenses.
Paul Barrett, CEO of Rome Resources Plc, emphasized that the settlement provides a pathway for shareholder compensation through the new licenses, while robustly maintaining focus on the ongoing exploration at the Bisie North site in the Democratic Republic of the Congo. Future updates on this project are anticipated as the company proceeds toward further developments and potential monetization of the new licenses.
In summary, Rome Resources Plc has reached a settlement with the Mozambique government regarding a historical claim linked to the expropriation of a mining concession. This agreement will result in the granting of new exploration licenses while allowing Rome to maintain a carried interest. Legacy shareholders may benefit through Bonus Preference Shares, though the non-cash nature of the settlement poses challenges. The company remains committed to its core project in the DRC, looking to provide further updates in the near future.
Original Source: www.sharesmagazine.co.uk
