LONDON: Altona Energy, a mining investment company with significant coal resources in Australia, has entered into a Memorandum of Understanding (MoU) with Shaanxi Qianyan Vanadium and Magnesium Mining Industry Ltd Company, the owner of an operational vanadium mine in China, with the aim of forming a Joint Venture Company in which it is expected that Altona will eventually become the controlling shareholder.[the_ad id="31605"]Both the Company and Shaanxi Mining have commenced due diligence to examine the feasibility of this partnership. However, until a formal joint venture agreement has been signed, the deal is conditional, and not binding on either the Company or Shaanxi Mining. The due diligence process is expected to take up to six months to complete and is dependent upon a number of factors, including Shaanxi Mining being granted a provincial government permit which will allow it to enter into an international joint venture agreement with Altona. During this period, Shaanxi Mining will commission a mineral resource classification report in accordance with the Australian Joint Ore Resources Committee Code (?JORC?). This report is expected to take some five months to complete and will form the basis of a valuation for any acquisition. The successful pursuance of this potential acquisition, and indeed the ability of Altona to pursue all of its strategies, requires the Company to obtain further funding. As previously announced the Company is considering a number of funding options and this may involve a strategy to re-list its shares on the London Stock Exchange, which will be planned to coincide with the signing of the joint venture agreement. Initial discussions with the owners of Shaanxi Vanadium indicate that it is an operational vanadium mine, with an original estimated reserve of 190,000 tonnes of vanadium. In 2018 Shaanxi Vanadium reported revenues of approx. RMB 35 million (£3.9 million) and a net profit of approx. RMB 20 million (£2.3 million). The mine was at full production for approximately half of the year, due to the installation of new equipment and processing techniques, in order to increase productivity, as mentioned above. The company sells the vanadium pentoxide via China FerroAlloy Online (www.cnfeol.com), a recognised Chinese commodity market. Should a JV company be established, Altona, with its access to the UK capital markets, will consider seeking new funding in order to help implement the mine’s current strategy to increase production over the next 18 months, although the mine is not dependent upon external funding to implement its growth strategy. Further, the mine being owned by a non-Chinese JV Company could be beneficial in opening up new international markets in which to sell the vanadium, which is in high demand around the world.