Under the terms of the agreement, Xtract will pay $100,000 to Aardvark to carry out due diligence for the Namakwa deposit.
The Namakwa deposit, which is divided into a northern and central zone, covers an area of 58,375h in the Northern Cape province of South Africa.
Xtract Resources CEO Jan Nelson said the Namakwa deposit is at an advanced stage and excellent infrastructure in available in the area.
"No further geological work or drilling would be required to evaluate the central zone and our due diligence will concentrate on the consideration of the metallurgical test work programme that would be required to confirm recoveries and determine the capital cost of a plant," Nelson added.
"As a result of the end of the Highly Enriched Uranium Purchase agreement between Russia and the US and the cancellation of several uranium projects in Russia and Kazakhstan approximately 45Mlb of uranium supply will be taken off the market, which is anticipated to have a positive impact on the uranium price."
