Apollo on acquisition hunt to diversify

Apollo Minerals (ASX:AON) is looking to diversify its commodity exposure with the acquisition of the Belgrade Copper Project in Serbia in the next 2 months. 

The project comprises 4 licences covering 202km-square and formed  part of the Serbian copper exploration project portfolio held by Reservoir Minerals prior to its 2016 acquisition by Nevsun Resources (TSX:NSU) in a US$365 million deal. 

The deal with Reservoir was also subsequent to a US$1.4 billion takeover by Zijin Mining Group.

Apollo will acquire 100% of shares in Edelweiss Mineral Exploration, the current owner of the project, through a conditional agreement with the vendor. 

Under the transaction, the $14.74 million market capitalisation company will issue the 30 million fully paid ordinary shares, as well as 2 batches of 10 million unlisted options exercisable at $0.05 and $0.075, respectively, expiring 3 years from the issue upon completion of the transaction. 

Other terms of the acquisition include a further 20 million deferred shares being issued following the announcement of a JORC-compliant mineral resource of at least 12 million tonnes at 2% copper or equivalent within 5 years of the completion of the acquisition. 

Edelweiss is expected to retain a 2% net smelter royalty on future production over the licences and licence applications, according to Apollo.  

Speaking to Mining.com.au, Apollo Minerals Managing Director (MD) Neill Inwood says the company is ‘very excited’ to be operating in this copper region. 

“We’re hunting in a region of the giants and this trend where the Belgrade Copper Project hosts significant large-scale copper projects, and we’re very excited to be operating here. 

Copper projects like this are hard to find and there’s not many of them, and this project looked to us to be a very quality project (with) good exploration potential.”

We’re hunting in a region of the giants

The MD tells this news service the project demonstrates favourable qualities that tick the boxes the company was looking for within this mining jurisdiction, being only a stone’s throw away from a ‘world-class’ copper deposit.    

“Looking at a red bed Permian copper system we think is very attractive. That was a big tick for this project. We’re looking at the right type of geology and structure, which we’re seeing here, and we’re looking at non-mineralisation historically. So that’s the 3 big ticks for this asset. And then you look at a country and jurisdiction risk, and we think Serbia is actually quite a good country to be operating in, especially when you have a world-class copper deposit being mined only 80 kilometres away.” 

Inwood tells this news service this project complements its existing Gabon base metals focus in the ‘province-scale’ Kroussou Zinc-Lead Project, and provides an opportunity for its geological team to deliver further exploration discovery, as well as diversify its commodity exposure. 

“We see this acquisition for copper being complementary to our zinc-lead base metal project in Gabon. As a company, we’ve always liked copper as well… electrification [is] the future, and sedimentary copper is in focus.”

The MD adds: “We think it’s a very good deal for the company and the shareholders. It’s minimally dilutive. There’s good conditions for the shareholders up front, even for the vendor. If a reasonable deposit is found, the vendor will gain the benefit in the back end. So we think for our shareholders makes a lot of sense. To own 100% of the asset makes a lot of sense. This deal would be our sweet spot, but we’d always be open for other avenues as well.

“to own 100% of the asset makes a lot of sense”

The beauty of the acquisition, it’s a share-based acquisition, so it’s 30 million shares, so there’s no cash requirement for the acquisition. So that’s actually, again, really good for shareholders.

You always want to be looking at other opportunities. I think what would make sense for us is that we have an eye for assets which are sitting potentially unloved, potentially unpegged and looking for opportunities in the region.”

Inwood explains the company wishes to waste no time and is seeking to undertake exploration, not just at Belgrade, but also at its Gabon project.

“The very strong focus for us will be on developing the Belgrade copper project and also continuing on with the great fieldwork that we’re doing in Gabon on the base metal project and also on the gold project. For the Belgrade Copper project, our next steps are to get the geochemical definition around the 70 kilometres of contacts and that’ll be soil sampling.

We expect to be on the ground next month with teams there, and then we will be looking at trenching mapping. We expect to get some strong target generation on the Serbian assets.

We want to get boots on the ground back in Gabon and we’ll be looking at options on the base metal, advancing the exploration there, but also on the gold asset. I think this will be quite an interesting developing story.

We’re quite confident we can execute the exploration plans in both areas.”

For the Belgrade Copper project, our next steps are to get the geochemical definition around the 70 kilometres of contacts and that’ll be soil sampling

Apollo Minerals is focused on the discovery and development of ‘large-scale’, near-surface, zinc-lead resources at its wholly owned Kroussou project in Gabon. 

The company had $1.7 million cash at hand as of 30 June 2023, according to its latest quarterly report.

Write to Adam Drought at Mining.com.au

Images: Apollo Minerals
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Written By Adam Drought
Born and raised in the UK, Adam is a sports fanatic with an interest in Rugby League and UFC/MMA. When not training in Muay Thai and Brazilian Jiu Jitsu, Adam attends Griffith University where he is completing his final year of a Communication & Journalism degree.