ASX-listed Kasbah Resources has announced a rights issue to raise some A$2.7 million to fund further drilling at its Achmmach tin project in Morocco. The cash will go towards 15,000 metres of diamond drilling in the Meknes Zone aimed at identifying a JORC indicated resource in the range of 1 to 2 MT from within the existing JORC Inferred Resource of 6Mt @ 0.9% Sn.
The work is part of a plan to produce a feasibility study on the project by June 2011, in line with a recently extended agreement with the Moroccan government which will allow it to exercise an option to acquire 100% of the project in the El Hajeb region of Morocco.
The agreement also has provision for Kasbah, at its election, to utilise a further 12 months from June 2011 to optimise the study if required. On exercise of the option the energy and mines ministry will transfer the Achmmach mining permits to Kasbah in return for payments of US$1m on transfer and thereafter, annual payments of US$1m for 4 years. The total transfer price is US$5m plus a 3% net smelter royalty.
