Montero Mining boosts stake in Wigu Hill to 70%

Montero Mining and Exploration (CVE:MON) said Tuesday that it has increased its stake in the Wigu Hill rare earth element project in Tanzania by a further 10%, for a total 70% interest in the property.
The company said it has entered into a shareholders agreement with its joint venture partner, RSR Limited, under which the property is being 100% transferred to a newly formed subsidiary in which Montero will retain a 70% equity interest.
Under the terms of the deal, Montero has agreed to pay RSR US$1.5 million as consideration for the additional 10% stake, with $0.8 million already paid on signing the shareholders agreement. The remaining $0.7 million will be paid following the grant of a mining license for the Wigu Hill project, as well as a development agreement for the area and a retention license for the portion of the property not subject to the mining license.
Montero said it has already satisfied its obligation under the option deal to incur not less than US$3.5 million in exploration expenditures on the project.
"Increasing our interest in the Wigu Hill REE Project to 70% and entering into a shareholders agreement is crucial to the advancement of the project to the mining licence stage and secures our equity position in our flagship Rare Earth Project," said president and CEO, Dr. Tony Harwood.
"We remain focused on adding to our initial NI 43-101 Resource Estimate by further drilling and advancing the metallurgical and hydrometallurgical test-work, driving to our target of building a mine and producing the Light Rare Earth Elements for sale.”

Wigu Hill is a high grade undeveloped light rare earths deposit where the company’s current focus is further exploration drilling to boost the initial resource, which currently stands at 3.3 million inferred tonnes on only the eastern ridge of the project, suggesting the potential for expansion.
In early September, the company released the estimate of the Tembo and Twiga deposits, prepared by AMEC Earth & Environmental Services, which indicated an inferred resource of 3.3 million tonnes at a grade of 2.6% light rare earth oxide (LREO5).
Rare earth elements, a group of 15 metals, are critical in the development of emerging green technologies and high-tech applications, from electric and hybrid vehicles and wind and hydro power turbines, to LCD screens, MRI, X-ray machines, mobile devices and other computing equipment.
The initial resource was developed from the preliminary drilling program of 21 boreholes, or 2,225 metres, with holes drilled to a maximum depth of about 150 metres below surface. In 2010, detailed sampling on Tembo and Twiga identified high-grade total rare earth oxide (TREO) values with individual values of up to 26.2% TREO and 27.25% TREO, respectively.