(MENAFN - ProactiveInvestors - Australia) Narhex Life Sciences (ASX: NLS) has entered into a deal to acquire an 80% interest in a Liberian Gold and Diamond Project.
The company has inked a Letter of Agreement with Golden Saint Australia to acquire its interest in Golden Saint Liberia, which owns an 80% interest in Block 71 - The Grand Cape and Block 72 - Mount Henry/Gengba.
Indicating the prospectivity of the area, Block 72, which covers 103 square kilometres including the Gbeye and Morro Rivers, is located around 30 kilometres north of Aureus Mining's 1.7 million gold ounce New Liberty Gold Project.
Meanwhile, Block 71 covers 401 square kilometres about 30 kilometres north-northeast of Bopolu, near Henry Town in Gbarpolu County and includes the Loffa River.
Both blocks are targets for primary and secondary gold and diamond occurrences.
The two blocks are located in the sub-equatorial northern part of Liberia on the Mann Craton, an area prospective for later stages of gold mineralisation and a known host of diamondiferous kimberlites which can report high grades, high quality and larger stone sizes.
There is limited historical exploration recorded on the Golden Saint tenements, but artisanal workers have been actively recovering both gold and diamonds from the stream beds and hills for over 50 years.
During the 1960s and 1970s, the United States Geological Services and the Liberian Government began geological mapping of the country, including Blocks 71 and 72.
Subsequent mapping noted the presence of mineralisation in the area and these were used to initiate exploration on surrounding properties.
However, no systematic work has been done on Blocks 71 and 72.
Narhex will pay non-refundable deposit of 50,000 and undertake due diligence over the projects.
If due diligence is acceptable then Narhex and Golden Saint will enter into a formal share purchase agreement by 1 June 2013.
A further 50,000 is payable on execution of the share purchase agreement.
Narhex will then issue up to 900 million performance shares on attaining several milestones, such as a JORC Resource of 250,000 gold ounces at 2 grams per tonne.
The company has committed to spending 5 million on the tenements to acquire 100% of the issued capital in Golden Saint.
Following execution of the share purchase agreement, Narhex will be required to re-comply with Chapters 1 and 2 of the ASX Listing Rules prior to finalising the acquisition.
The company will issue a prospectus to raise sufficient funds to enable the re-compliance.
Funds raised will be used to conduct exploration of the properties to be acquired, and cover the ongoing administration costs of the company.