Parabellum Resources Ltd (ASX:PBL) has traded 80% Khotgor Rare Earths project in Mongolia to Temarise Limited after the latter exercised its exclusive option to acquire the equity in the project.
On 13 February 2023, the company updated shareholders on the results of the 2022 infill drilling program and presented the project's updated mineral resource estimate.
Temarise now owns 80% of Khotgor
Back in August 2022, Parabellum entered into an agreement to sell the project to Temarise, which has now informed its shareholders that it has exercised the option.
At the time, Parabellum Resources non-executive chairman Mark Hohnen said: “The Board of Parabellum is excited to enter into an agreement with Temarise Limited (UK) that holds the exclusive option to acquire 80% of Khotgor Project, Mongolia.
“Khotgor is one of the world's largest rare earth deposits and has the potential to be a major supplier of NdPr; the vital material needed for magnets and therefore the future of wind power generation.
“Rare earths remain critical in various applications with future demand to remain strong and expected to increase five-fold by 2030, driven by the clean energy economy through e-mobility and wind power.
“I am a long-term believer and excited by the NdPr requirements for the world to meet its clean energy needs and the Khotgor Project is extremely well placed geographically to take advantage of these growing demands.
“I have worked with the team from Temarise over the past decade and am very excited for Parabellum to partner with such a professional and experienced group."
PBL will work together with the Temarise operations team, which has significant experience in the development of battery metals projects and has been working with the local Mongolian owners of Khotgor for a number of years.
Exercise price of US$15 million
The exercise price of the option is US$15 million, with payment required on or before May 22.
In January 2023 Parabellum completed its subscription for 30% of the issued share capital of Temarise, for a total subscription price of $A3.9 million.
PBL remains a minority shareholder in Temarise and does not have any representatives on its board.
It and Temarise are now in discussions about how the exercise price may be funded, though there is currently no arrangement between Parabellum and Temarise in relation to the financing of the exercise price and this will be subject to regulatory and shareholder approval.