(Ecofin Agency) - Kasbah Resources signed an agreement with mining investor Pala Investments to advance the Achmmach tin project, in Morocco. The firms said proceeds of the agreement will be used to advance the project to exploitation stage which is expected to begin next year.

Under the agreement’s terms, Pala Investments will buy 138 million shares of Kasbah Resources, at $0.027 a share, thus $3.7 million. With this, it will get a 19.9% interest in the firm.

Last August, definitive feasibility study (DFS) for the project brought down its development cost, which now stands at $61.7 million. Ore reserve at the project was estimated at 6.56 million tons, grading 0.85% tin for 55,500 tons.

Kasbah Resources plans to develop the project in two stages, in the first to mine 1.89 million tons of ore, grading 0.96%, in the second, 4.67 million tons at 0.80%. The project will be carried out over 10 years and has been estimated to cost overall $11,541 per ton of tin.

The Achmmach tin project is a joint venture between Toyota Tshusho (20%), Nittetsu (5%) and Kasbah Resources (75%).

Louis-Nino Kansoun