Resource World Magazine

48 www.resourceworld.com D E C E M B E R / J A N U A R Y 2 0 2 0 F unding for mineral exploration has changed over the years, but one of the re-emerging trends is the partner model with the majors. It's a business model Mundoro Capital Inc. [MUN-TSXV; MUNMF-OTC; NGU-FSE] has adopted to explore their Serbian and Bulgarian projects enabling them to preserve working capital and minimize dilution of the company's stock. "A well-structured earn-in agreement or strategic alliance is a win-win," says Teo Dechev, President and CEO of Mundoro Capital Inc. In Mundoro's case, the company scouts out, vets, and acquires prospec- tive properties and then contributes its local geological and technical expertise, local operational experience, and geologi- cal database in return for senior mining companies to contribute funding and their international technical expertise for min- eral exploration. From Mundoro's perspective, these partnerships provide a source for funding to allow pursuing exploration activities along the Tethyan Belt in Serbia's Timok Magmatic Complex where their projects are intertwined between the corridors of several world class historic and active met- als mines. From Mundoro's partner's perspective including: Japan Oil Gas and Metals National Group (JOGMEC), Freeport- McMoRan [FEX-NYSE] and Vale Canada Inc. [VALE-NYSE], the partnership serves as a means they can enter an exploration land package in new regions and outsource to a local, proven exploration team, with local operational experience and estab- lished stakeholder relationships. "Because early stage exploration is risky and the capital markets are reluc- tant to finance early stage exploration, we adopted the partner model and see this is as a proven model for discoveries to occur in the industry. It takes capital and a wide range of experience to make a new discov- ery so we've strategically partnered with industry miners, particularly in the cop- per world, to reduce the risks and bring the best of what each party has to offer," says Dechev. "The benefit to the min- ers that partner with Mundoro is access to an attractive land package, work with an experienced local exploration team that can operate in the local environment and has established relationships with local stakeholders; while the benefit for Mundoro and its shareholders is access to capital for exploration, collaboration on exploration programs and participation in the value increase of the joint venture proj- ect if a discovery is made on that project." Mundoro Capital currently has three earn-in arrangements. The longest being with JOGMEC which had an earn-in option on four of Mundoro's Serbian exploration licenses: Dubrava, Padina, Borsko Jezero and Zeleznik in the northern portion of the Timok Magmatic Complex in northeastern Serbia. Under the original agreement, JOGMEC spent US $4 million to earn a 51% interest in the projects with the option of a Phase Two program. In early 2019, JOGMEC elected to undertake the second phase to sole-fund exploration on the Borkso license. To earn- in to Phase Two and attain an additional 24% interest, JOGMEC will need to spend another US $32 million over five years. "Mundoro benefits from establishing earn-in relationships such as this. As a result of having partner-funded explora- tion programs the company is required to raise less capital through equity offer- ings thereby minimizing dilution," says Mundoro Capital in Serbia. Photo courtesy Mundoro Capital Inc. Mundoro Capital generating value through partner model THROUGH THREE PARTNERSHIPS, MUNDORO CAPITAL IS FUNDING EXPLORATION WHILE PRESERVING WORKING CAPITAL AND MINIMIZING STOCK DILUTION. by Robert Simpson MINING

• Cover