Global miner to fund metals exploration at Honeymoon

SYDNEY, AUSTRALIA: Boss Energy Limited (ASX: BOE) has entered into an exploration earn-in agreement with global mining company First Quantum Minerals Ltd (FQM).

Under the terms of the agreement, which relates to the base and precious metals rights over five tenements at Boss’ Honeymoon Uranium Project, FQM will fund an initial base and precious metals exploration program.

FQM then has an option to earn into any base or precious metals discovery by funding exploration and other related expenditure up until a Decision to Mine.

FQM is a significant Canadian-listed group operating eight mines across four continents producing copper, nickel, and gold with an additional three mines under development.

With a proven track record in discovering and developing deposits, Boss considers FQM an ideal partner in the exploration and
potential development of any base or precious metal discoveries at Honeymoon.

Boss Managing Director Duncan Craib said: “This agreement is an outstanding opportunity for Boss and our shareholders.

“We will have a global leader in FQM funding base and precious metals exploration at Honeymoon, giving Boss significant exposure to their success at no cost to us while we focus on our goal of becoming Australia’s next uranium producer”.

The Agreement relates to the area covered by 5 tenements at Boss’ Honeymoon Uranium Project.

FQM, through its subsidiary First Quantum Minerals (Australia) Pty Ltd, has committed $250,000 to an exploration targeting and due diligence program on the Project Area which must be completed by 31 December 2022.

After completion of the Targeting Program, FQM may elect either to proceed with the work program or withdraw from the Agreement.

The Work Program will comprise target definition programs and 1,800m of RC and diamond drilling and all associated geochemical analysis. FQM must complete the Work Program by 1 February 2024.

After completion of the Work Program, FQM may elect to earn a 51% interest in any base or precious metal discovery by sole funding $6M of expenditure within 5 years and maintaining minimum annual
expenditure of $500,000 (First Earn-in).

At this point, the parties will enter into a joint venture agreement.

After completion of the First Earn-in, FQM may elect to earn an additional 24% interest in the discovery for a total interest of 75% by sole funding expenditure until a Decision to Mine within 5 years and maintaining minimum annual expenditure of $500,000 (“Second Earn-in”).

FQM may extend the Second Earn-in up to 10 years by increasing minimum annual expenditure to $1M.

After acquiring a 75% interest, FQM shall continue to sole fund required studies and programs up to receipt of all permits for commencement of construction, after which Boss can maintain its interest of 25% by funding its share of project development costs or dilute.

If FQM does not complete the Second Earn-in, Boss’ interest in the discovery will revert to 51% with FQM retaining a 49% interest.

Boss shall be the operator until FQM has acquired a 51% interest after which FQM can opt to become the operator of any discovery.

Boss retains the sole right to explore for and exploit all uranium discoveries on the Project Area (being greater than 50% of the in-situ metal value being uranium).

Boss will have a first right of offer in respect of any uranium discoveries made by FQM within the Curnamona craton of South Australia.

FQM may withdraw from the Agreement at any point pursuant to 60 days’ notice. If the withdrawal occurs after FMQ has earned a 51% interest, but prior earning a 75% interest, Boss shall revert to a 51% interest.

Should either party’s interest fall below 10%, its interest will convert to a 1% net smelter royalty.

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