Mineral Commodities (ASX:MRC) has elected to divest its interest in the Tormin Mineral Sands Project in South Africa as the company shifts to focus on its graphite assets and downstream active anode material projects.
The company has entered into a process deed agreement with industrial garnet provider GMA Group to negotiate a potential sale and purchase agreement, which would result in GMA owning the Tormin Project.
Under the agreement, both companies will negotiate under a three-month exclusivity period. There will also be a three-month standstill period related to a loan provided by GMA under an agreement in May last year.
Mineral Commodities says it will continue to operate as normal during this period.
The company, which has a market capitalisation of $23.62 million, and its privately held partner Blue Bantry Investments 255 each hold 50% of Mineral Sands Resources Proprietary, which in turn owns the Tormin Project.
CEO Scott Lowe says Mineral Commodities’ priority is to focus on advancing its Munglinup development project in Australia, its Skaland graphite mine in Norway, and the Active Anode Material Project.
The Tormin Project sits 360km north of Cape Town on the west coast of South Africa.
Mineral Commodities and GMA have a long-standing relationship, under which Mineral Commodities agreed to supply GMA with finished garnet products during May 2023.
GMA agreed to provide the company with US$10 million ($15.1 million), repayable over five years from 1 January 2024, to fund the design and construction of a mineral separation plant in South Africa. To date, roughly US$4.5 million has been drawn down for improvements in secondary processing and water supply capacity.
Write to Aaliyah Rogan at Mining.com.au
Images: Mineral Commodities
