URU Acquires Umnex Minerals Limpopo (Pty) Ltd – obtains 100% ownership of Zebediela Nickel Project in South Africa

May 16, 2014

Following the acquisition of its joint venture partner, Southern African Nickel Limited (“SAN”) late last year, Kerman & Co has advised URU Metals Limited (“URU”) on the acquisition of 100% of the share capital of Umnex Minerals Limpopo (Pty) Ltd (“UML“).

UML is the 100 per cent. legal owner of the Zebediela Nickel Project in South Africa, having previous been party to JV Agreement with SAN and URU.

With the acquisition of the entire issued share capital of UML, URU now has a 100% legal and beneficial ownership in the Zebediela Project.

The acquisition also finalises an ongoing arbitration dispute between UML, SAN and URU.

Background information on the Zebediela Nickel Project

The Zebediela Nickel Project is located in the Limpopo Province of South Africa close to the platinum mining town of Mokopane, very close to existing rail, highway, and electrical power infrastructure.

The Zebediela Nickel Project is located in the Limpopo Province of South Africa close to the platinum mining town of Mokopane, very close to existing rail, highway, and electrical power infrastructure.

The Zebediela Nickel Project is a large disseminated sulphide resource with mining engineering aspects similar to porphyry copper deposits in terms of size and grade. The NI 43-101-compliant PEA led by the MSA Group outlined indicated resources of 485.4 million tonnes averaging 0.245% nickel, and additional inferred resources of 1,115.1 million tonnes of 0.248% nickel. The Zebediela Project also contains significant iron minerals in the form of magnetite that is also being investigated as a potential by-product.

The Zebediela project is a world class project with combined inferred and indicated resources of over 1.5 billion tonnes of nickel. A NI 43-101 compliant Preliminary Economic Assessment (“PEA”) was completed in 2012 showing indicated resources of 485.4 million tonnes averaging 0.245% nickel, and additional inferred resources of 1,115.1 million tonnes of 0.248% nickel.

Extensive work was conducted on the Zebediela deposit metallurgy indicating that 50% of the total contained nickel could be recovered into a high quality saleable nickel concentrate averaging 16% Ni. Start-up capital expenditures including contingencies and working capital are estimated to be $650 million and sustaining capital is estimated at $58 million over the life of the mine. Operating expenditures are estimated to be $3.35 per pound of recoverable nickel.

Michael Corcoran (Partner), lead the Kerman & Co corporate team supported by David Tink (Solicitor).