Global Energy Metals Announces Signing of Agreement to Take Accelerated Ownership Stake in the Lovelock and Treasure Box Battery Mineral Projects in Nevada
Vancouver, BC - TheNewswire - April 7, 2020 - Global Energy Metals Corporation (TSXV:GEMC) | (OTC:GBLEF) | (FSE:5GE1) ("Global Energy Metals", the "Company" and/or "GEMC") is pleased to announce that it has successfully negotiated and entered into an agreement (the "Agreement") with Nevada Sunrise Gold Corp. ("Nevada Sunrise") and Primus Resources L.C. ("Primus") pursuant to which Global Energy Metals will accelerate and acquire an ownership interest in the Nevada-based Lovelock and Treasure Box battery minerals projects (the "Property"). This Agreement will replace and supersede the original option agreement made as of January 15, 2019 pursuant to which Nevada Sunrise granted to Global Energy Metals an option to purchase an undivided 85% interest in the Property.
The Agreement provides Global Energy with a controlling interest over the Property earlier than planned in the previous earn-in agreement, empowering GEMC to explore and develop the asset in a timely and expedited manner but without the project expenditure outlay and strict timelines originally contemplated.
Mitchell Smith, President & CEO commented:
"Now, more than ever, companies need to adopt to survive the unprecedented and rapidly changing environment we all find ourselves in. For us that means continuing to move forward."
"As a shareholder-aligned management team with significant investment exposure in the company, we see opportunities to further optimize our business around our core assets while providing our shareholders exposure to one of the fastest growing megatrends - Vehicle Electrification & Energy Storage - through our portfolio of battery mineral projects located in safe, pro-mining jurisdictions."
"An accelerated ownership stake in the Nevada-based projects provides the Company and its shareholders with high-potential, growth-stage exploration projects in a well established mining district. Additionally it provides the foundation to break free from the over-reliance of critical material imports from China and other competing nations and instead develop a domestic supply of battery metals critical to sustain our national and economic security."
Main Terms of the Accelerated Ownership Agreement
Upon the satisfactory completion of certain closing conditions, the accelerated ownership Agreement provides, among other things, that Global Energy Metals will purchase an 85% interest in the Property, with Nevada Sunrise retaining a 15% in the Property, subject to a 2% net smelter royalty in favour of Primus provided for in the underlying option agreement between Primus and Nevada Sunrise. A joint venture between Global and Nevada Sunrise will be formed to further explore and develop the Property.
In consideration for the entering into of this Agreement and for the accelerated transfer of the Property to as to an undivided 85% interest and Nevada Sunrise as to an undivided 15% interest, Global Energy Metals shall on Closing:.
1.Pay to Primus the sum of USD $35,000 ( the "Cash Payment");
2.Issue to Primus 1,000,000 Common Shares of Global (after giving effect to Global's recently announced share consolidation which is not yet in effect), at the deemed price of CDN $0.10 a share; and
3.Issue to Nevada Sunrise 750,000 Common Shares of Global (after giving effect to Global's recently announced share consolidation which is not yet in effect), at the deemed price of CDN $0.10 a share and forego the originally contemplated exploration expenditures of USD $1 million.
The Shares issued to Primus and Nevada Sunrise will be subject to voluntary escrow provisions in addition to applicable statutory and Exchange imposed hold periods.
Upon the earlier of 1 year or CDN $1 million of project expenditures incurred by Global Energy Metals, both Global Energy Metals (85%) and Nevada Sunrise (15%) would fund joint venture expenditures pro rata to their joint venture interest or be diluted to a 1% Net Smelter Royalty ("NSR"). The NSR can be repurchased by either party for CDN $1 million.
Primus will maintain its current NSR on the Nevada Projects being 2% with Global Energy Metals having the right, exercisable at any time, to purchase up to 50% of the Royalty granted to Primus by payment to Primus of $1,500,000 subject to a protection hedge against inflation of the U.S. Dollar, using an agreed upon price of $3.25 per pound copper. Upon payment of $1,500,000 or the cash value of 462,000 (four hundred, sixty two thousand) pounds of copper, whichever value is greater at the time of the purchase of half of the Royalty, the Royalty shall be reduced to 1% of Net Smelter Returns.
Figure 1. Location Map of Lovelock and Treasure Box Projects in Nevada, USA
The Property currently consists of 81 unpatented lode claims in the Cottonwood Canyon area of the Stillwater Range totaling approximately 642 hectares. It was discovered by George Lovelock and Charles Bell about 1880. According to U.S. Government annual reports, the Lovelock Mine saw limited production of nickel, copper and cobalt beginning in 1883. The primary cobalt mineral was identified as "cobaltite". The general average of the 200 tons shipped in 1886 averaged 14 percent cobalt and 12 percent nickel (Source: "Mineral Resources of the United States for 1885", 1886). The mine operated from 1883 to 1890 to the 100 foot level, reporting 500 tons of cobalt and nickel mineralized material shipped to England for processing. After intermittent production, an English company attempted smelting on site in 1898 but little or no production was made. No further production from the Lovelock Mine is known for well over a century. Results from Global Energy Metals' initial program in 2019 at the battery minerals project in Nevada confirmed the potential of the overall land package and indicated considerable promise. Given the scale and prospective nature of this battery minerals discovery, unlocking value from Lovelock and Treasure Box will be the primary focus of the company's 2020 exploration plan. The initial work program conducted in 2019 focused on defining structural controls in the known battery metal-rich areas. Results of this work proved successful in defining structures and connecting mineralized zones into broader targets in preparation for an inaugural drilling program. Given the very large exploration area, producing a property-wide geological interpretation and model of the structures and mineralization is an immediate priority and integral to a 2020 drill program. Compilation of historic data and recently completed work should lead to a better understanding of the controls of mineralization and allow the Comapany to unlock the cobalt, nickel and copper potential from GEMC's Nevada-based projects. The Company will focus its exploration program in the area central to the past-producing Lovelock Mine and will commence a first-ever drilling program to test the extent of mineralization. If assay results are encouraging then it is expected that additional holes will be drilled to test strike extent.
About Treasure Box
Treasure Box hosts mine workings from limited copper production, which occurred until early into the 20th century. A historical diamond drill hole (circa 1910) drilled at the Treasure Box by the Boyer-Nevada Copper Company reportedly intersected 1.52% copper over 85 feet (25.9 metres) with mineralization beginning at surface. A reverse circulation hole drilled on the Treasure Box by Utah International in 1976 returned 1.55% copper over 40 feet (12.2 metres) from a depth of 85 to 125 feet (25.9 to 38.1 metres) and reportedly stopped in chalcopyrite mineralization. The core Treasure Box claims were held continuously for over 20 years by a private company but were relinquished in September 2017, leading to their acquisition by Nevada Sunrise and now Global Energy Metals. Historic work and the prospective nature of the project provides Global Energy Metals with an excellent opportunity to unlock the potential value of the deposit through further exploration work.
The Company also wishes to announce that effective immediately, Christopher Ecclestone will resign as a member of Company's Board of Directors. Mr. Ecclestone has agreed to carry on with the Company as an advisor and will continue to identify and pursue new opportunities as part of the the Company's commitment to operationalize a clear action plan for critical mineral supply chain security through re-use and upcycling opportunities.
Mr. Paul Sarjeant, P. Geo., is the qualified person for this release as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects and has reviewed and verified the technical information contained herein.
(TSXV:GEMC | OTCQB:GBLEF | FSE:5GE1)
Global Energy Metals provides investors and partners with exposure to the immediate need for metals critical to the new energy economy by building a diversified global portfolio of cobalt and battery metals rich projects in top-tier mining jurisdictions with exploration & development upside to become a supply chain solution to safe and reliable cobalt for downstream partners. Global Energy Metals holds 100% of the Millennium Cobalt Project and two neighbouring discovery stage exploration-stage cobalt assets in Mt. Isa, Australia. It also currently owns 70% of the Werner Lake Cobalt Mine in Ontario, Canada and has entered into an agreement to acquire an 85% interest in two cobalt-nickel-copper exploration projects in Nevada, 150km East of the Tesla Gigafactory.
For Further Information:
Global Energy Metals Corporation
#1501-128 West Pender Street
Vancouver, BC, V6B 1R8
t. + 1 (604) 688-4219 extensions 236/237
Cautionary Statement on Forward-Looking Information:
Certain information in this release may constitute forward-looking statements under applicable securities laws and necessarily involve risks associated with regulatory approvals and timelines. Although Global Energy Metals believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Except as required by law, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change. For more information on Global Energy and the risks and challenges of their businesses, investors should review the filings that are available at www.sedar.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
We seek safe harbour.