Reviewed by Danielle Ellis, B.Sc.Sep 20 2024
Madison Metals Inc. ("Madison" or the "Company") announced that it has reached a legally binding agreement with Star Minerals Limited, a well-managed Australian public company, to acquire Exclusive Prospecting Licence 8531 (also known as the "Cobra Uranium Project") at Madison North, which is close to the renowned Rossing Uranium Mine in the Erongo Uranium Province, Namibia.
As per the terms of the agreement, Star Minerals can acquire up to a 51% stake in the Cobra Uranium Project by making incremental cash payments, awarding Madison common shares, and carrying out exploration expenses over a three-year duration. Star Minerals would be entitled to cash, stock, and work expenditures totaling about US$4.4 million if all earn-in options were exercised by Madison.
Madison will also receive performance shares from Star Minerals after meeting certain exploration benchmarks. Madison and Star Minerals will establish a joint venture to investigate and possibly develop the Cobra Uranium Project license following the successful completion of the earn-in. Future contributions will be made on a pro-rata basis.
We are excited to welcome Star Minerals as a partner in the development of the Cobra Uranium Project. This agreement strengthens Madison’s operational footprint in Namibia, as we now have active exploration efforts underway on two uranium projects in one of the world’s premier uranium mining jurisdictions. We believe this partnership will unlock significant value for both companies and our respective shareholders, and we look forward to advancing our mutual goal of driving sustainable uranium production to meet global energy demands.
Duane Parnham, Executive Chairman and CEO, Madison Metals Inc.
The Cobra Uranium Project is ideally situated in Namibia, one of the top mining jurisdictions in the world, with a long history of assisting the uranium industry and a hospitable regulatory framework. Madison's strategy of using partnerships to speed up exploration and development while keeping an eye on generating long-term value for its shareholders is in line with this collaboration with Star Minerals.
A non-arms-length party is required to receive 450,000 common shares of Madison from the Company in connection with the execution of the aforementioned earn-in agreement. Half of the shares will be issued upon execution, and the remaining half will be issued after Star Minerals reaches its first earn-in milestone.