LONDON, UK: MRG Metals Limited (ASX: MRQ), a mineral exploration company, has announced that it has signed a memorandum of understanding (MOU) with Tianjin Lanqi Materials Company Limited (LANQI), a Chinese company engaged in the production and sale of titanium dioxide and other materials, for a joint venture (JV) operation on its Corridor Sands projects in Mozambique.

The MOU provides for a three-month due diligence period, during which LANQI will send its technical team to Mozambique to inspect and sample the Corridor projects, which are prospective for heavy mineral sands containing titanium and zircon. MRG will assist LANQI in this work. LANQI will also draft a JV agreement and send it to MRG along with its decision to proceed to the JV, such that the JV is signed at or before the end of the due diligence period.

The MOU also includes a commitment from LANQI to purchase $500,000 worth of MRG shares at 0.1 cents per share upon the successful completion of the due diligence and the signing of the JV.

The key terms of the JV are that the parties will set up a JV company in Mozambique, owned 75% by LANQI and 25% by MRG, which will be achieved upon first production from the Corridor projects.

MRG’s chairman, Andrew Van Der Zwan, said the MOU was a significant milestone for the company and its shareholders, as it would provide access to LANQI’s expertise and resources to advance the Corridor projects. He said the JV would also benefit from LANQI’s strong market position and customer base in China, which is the largest consumer of titanium dioxide in the world.