LONDON (ShareCast) - (Sharecast News) - Kazera Global announced on Friday that its subsidiary, Whale Head Minerals (WHM) has entered into a sales and offtake agreement with Fujax South Africa, a subsidiary of Fujax Group, for the sale of heavy mineral sands (HMS) production.
The AIM-traded firm said that under the agreement, WHM would supply an initial 100,000 dry tonnes of HMS in monthly shipments of approximately 6,000 tonnes, with the first sales expected to begin by March.

WHM would receive 80% of the anticipated final sales price, minus costs, within five days of delivery to the mine gate.

The remaining balance, less costs and a marketing fee payable to Fujax, would be paid within five days of the final sale of the product.

Fujax would manage and bear all costs associated with the transportation, processing, assaying, and sale of the HMS.

That would include handling taxes, duties, levies, and other charges related to logistics and export.

Additionally, Fujax would provide WHM with a $0.6m prepayment in two equal tranches in December and January.

"I am delighted that we have managed to secure this offtake which validates the progress we have made at WHM," said chief executive officer Dennis Edmonds.

"Fujax is a well-established global commodities company and its willingness to provide Kazera with a significant prepayment and fair pricing structure speaks volumes about its quality as an offtake partner.

"Fujax's contacts and financial backing makes them perfect partners both in the short term and for the planned expansion of our operations into the Perdevlei HMS project, which has a land area approximately 34 times larger than WHM's current Walviskop project."

Edmonds said Kazera's focus was now on fine tuning the WHM plant to meet Fujax's requirements, with a view to ramping up production early in the new year.

"While this 100,000 tonne offtake is substantial, it represents just the beginning.

"Walviskop boasts a JORC-indicated resource of approximately 1.5 million tonnes of heavy mineral sands which is continually being replenished by natural wave action.

"Add to that the resource which is represented by Perdevlei, and the company becomes a serious player in the market."

At 1326 GMT, shares in Kazera Global were up 20% at 1.35p.

Reporting by Josh White for Sharecast.com.

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