Tivan has secured the regulatory and cultural heritage clearances needed to advance an 8,000-metre drilling campaign at its Molyhil tungsten project in the Northern Territory. The company will also issue 3.84 million shares as part-payment for the project acquisition, while its feasibility and proposed funding plans remain unfinished.
- Final NT Government and Central Land Council approvals for Molyhil drilling
- Approximately 50 holes planned across an 8,000m Stage 2 program
- Drilling to support resource, metallurgical, geotechnical and hydrogeological work
- 3.84 million shares to fund half of the first $1.75m deferred payment
- Proposed Sumitomo and ETFS Capital investment remains subject to long-form agreements
Molyhil drilling clears final approvals
Tivan Limited (ASX:TVN) has removed the last stated regulatory and cultural heritage barriers to an 8,000-metre drilling program at its 100%-owned Molyhil Tungsten Project in the Northern Territory. The approvals allow the company to finalise field planning and mobilisation, but drilling has not yet started.
The Northern Territory Government approved the campaign under Environment (Mining) Licence MXP1290-01 VAR001, while the Central Land Council issued a Sacred Site Clearance Certificate dated 10 September covering the proposed drill sites, support areas and groundwater-monitoring infrastructure.
Eight thousand metres aimed at project definition
Stage 2 is planned to comprise about 50 holes across the existing resource and wider project area. Tivan says the work will generate geological, metallurgical, geotechnical and hydrogeological data for feasibility studies, environmental approvals and development planning.
The program is intended to increase confidence in the current Mineral Resource, provide samples for metallurgical testing and supply engineering inputs for pit and infrastructure design. That makes it development work rather than a simple hunt for new mineralisation, although the company is also progressing exploration aimed at resource expansion.
Molyhil’s JORC 2012 Mineral Resource stands at 4.647 million tonnes grading 0.26% tungsten trioxide and 0.09% molybdenum, containing 12,100 tonnes of tungsten trioxide and 4,400 tonnes of molybdenum at a 0.05% tungsten trioxide cut-off. Those figures come from an earlier estimate, not from new drilling results in this announcement.
Share issue funds first deferred acquisition payment
On the same day, Tivan elected to pay half of its first deferred Molyhil acquisition instalment in shares. The $1.75 million payment due on 15 September will comprise $875,000 in cash and $875,000 in 3,837,383 Tivan shares, calculated using the company’s 10-day volume-weighted average price before the election.
Half of the shares will be subject to a six-month voluntary escrow. The issue reduces the immediate cash burden of the acquisition, but increases the number of shares on issue for existing holders. Tivan’s total acquisition consideration is $8.75 million, with two further annual deferred payments still to come.
Feasibility work precedes any development decision
Tivan is progressing a Pre-Feasibility Study after a Scoping Study that reported a base-case pre-tax NPV8 of $534.3 million. The company is targeting a mining and processing operation producing tungsten scheelite and molybdenite concentrates, but the study figure is inherited from earlier work and does not establish a construction decision.
The proposed funding pathway is similarly incomplete. Tivan has announced key-terms memoranda with Sumitomo Corporation and ETFS Capital for up to $50 million of stage-gated equity investment, with an intended effective 82.5% interest for Tivan at final investment decision, subject to long-form agreements. The next meaningful tests are therefore practical: mobilisation, drilling results, the Pre-Feasibility Study and whether the proposed investment framework becomes binding.
Bottom Line?
The approvals turn Molyhil from a planning exercise into an executable field program, but the investment case still depends on drilling data, feasibility work and definitive funding documents.
Questions in the middle?
- When will the 8,000-metre program mobilise and begin generating results?
- Will drilling materially change the current resource confidence, metallurgy or mine design assumptions?
- Can Tivan convert the proposed $50 million stage-gated investment framework into binding agreements before the next development milestones?