Vancouver, BC / TheNewswire / June 26, 2018 / Global Energy Metals Corporation TSXV:GEMC | OTCQB:GBLEF | FSE:5GE1 (“Global Energy Metals”, the “Company” and/or “GEMC”) is pleased to announce that it has entered into a binding agreement (the "Agreement") with Hammer Metals ("Hammer") to acquire the balance of the interest in the Millennium Cobalt Project (the “Millennium Property”) as well as the Mt. Dorothy Cobalt Project and the Cobalt Ridge Project (collectively the “Mt. Isa Projects”), such that it will hold 100% of both the Millennium Property and the Mt. Isa Projects.
This accelerated acquisition of cobalt rich assets positions GEMC as the region’s leading cobalt explorer/developer building a district-scale cobalt opportunity in Queensland Australia’s Mt. Isa prolific mining jurisdiction.
Mitchell Smith, President & CEO of Global Energy Metals, commented: “This combination creates one of the largest and most exciting exploration cobalt packages in Australia. Spurred by the recent drilling success and confidence in adding to the already significant cobalt tonnage at Millennium, we are pleased to announce this acquisition which furthers our long-term growth and value-building strategy. With this acquisition, we continue to consolidate multi-million tonne cobalt assets and maximize cobalt leverage for our shareholders. Upon completion, we plan to recommence exploration and expansion of the project with the intent to commission a current resource estimate for the projects as well as identify new opportunities in the cobalt rich district.”
‘The initial work program, that just concluded at Millennium, has only just begun to highlight the potential for the project to be part of a much larger regional cobalt play across the Mt. Isa region of Queensland Australia. Hammer is pleased to have the opportunity to be invested in such a dynamic and focused cobalt explorer and developer while retaining exposure to longer term value creation that the Millennium and Mt. Isa Projects will offer,” stated Alex Hewlett, Managing Director of Hammer Metals.
Global Energy Metals recently announced a series of consistent long and wide intercept high-grade cobalt results from assays from the phase one work program at the Millennium Property, an advanced exploration project with a JORC (2012) resource. The objective of the 10-hole, 1,141 metre drilling campaign was to test the up-dip continuity at the Millennium North deposit and confirm historical estimates of cobalt mineralization reported in 2016 by operating partner Hammer Metals. Drilling results correlate well with the previous deeper drilling with the further delineation of wide zones of cobalt, copper and gold mineralisation nearer to surface. The drilling campaign is now complete. Analysis and reporting of the previous drill results can be found in news releases dated June 19, 2018, May 31, 2018, April 30, 2018 and January 17, 2018.
Rock chip sampling has also been conducted to test for additional zones of cobalt and copper mineralisation along the Millennium trend and in particular the northern strike extension (“Northern Extension”) where similar host rock units and strong soil geochemical anomalies are located. This zone is located approximately 1 kilometre north of the current Millennium resource as defined. Results indicate high priority targets for further work to expand the known resource area.
The presence of anomalous cobalt and copper in rock chip samples and analogous geology between the Millennium resource area and the Northern Extension indicate that this area is a priority target for further investigation.
The Agreement:
Global Energy Metals shall purchase from Hammer Metals (the “Vendor”) the balance of the Millennium Property that it currently does not own and the Mt. Isa Projects, such that it will hold 100% of both the Millennium Property and the Mt. Isa Projects (together, the “Property”) in exchange for the issuance to the Vendor of such number of common shares in the capital of GEMC (the “Payment Shares”) as is equal to 19.9% of the issued share capital on the day prior to the date on which Exchange acceptance for such issuance is sought.
GEMC and the Vendor entered into an option agreement dated September 21, 2017 (the “Millennium Agreement”) pursuant to which the Vendor granted to GEMC an option to acquire 75% of the Millennium Cobalt Project, which is located in the Mount Isa mining region of Queensland, Australia. On March 21, 2018, GEMC gave notice to the Vendor that it had met its obligations under the Millennium Agreement to acquire a 25% interest in the Millennium Property.
GEMC and Hammer entered into a letter of intent dated March 9, 2018 (the “Mt. Isa LOI”) pursuant to which Hammer agreed to sell 100% of certain rights and interests held, directly or indirectly, legally or beneficially, by Hammer in and to certain mineral interests known as the Mt. Dorothy and Cobalt Ridge properties located in Mt. Isa, Queensland.
The Definitive Agreement contemplated by the Letter of Intent will supercede and replace the Millennium Agreement and the Mt. Isa LOI.
The transaction as described herein is subject to the approval of the TSX Venture Exchange (the “Exchange”).
The Transaction:
The Payment Shares will be subject to resale restrictions of 4 months plus one day in accordance with applicable securities legislation and will also be subject to a voluntary pooling agreement pursuant to which the shares will be released as to 20% on issuance and 40% every six months thereafter until 12 months after the date of issuance.
Upon the release of the Payment Shares, the Vendor will be limited to sell, on a weekly basis and on the open market, such number of Payment Shares that may not exceed 35% of the total volume of shares of GEMC traded on the Exchange on a weekly basis (the “Threshold Amount”). The Vendor agrees to obtain the consent of GEMC if it wishes to sell Payment Shares in excess of the Threshold Amount, such consent not to be unreasonably withheld having regard to the impact of such sale on the market price of the shares of GEMC.
For as long as the percentage of issued and outstanding shares of GEMC beneficially owned by the Vendor (the “Vendor Interest”) is at least 10%, GEMC will support the nomination of one individual designated by the Vendor for election or appointment to its board of directors.
Given Hammer’s technical and jurisdictional expertise, it will remain as operator of the Property until at least the first anniversary of the date of the Definitive Agreement, with such engagement to be reviewed and renewed on an annual basis thereafter. Hammer shall receive an operator’s fee of 10% of the expenditures carried out on the Property.
Hammer will also co-operate with GEMC with a view to identifying and acquiring additional cobalt assets in the Mt. Isa region of Queensland, Australia fulfilling its mandate of creating a diversified and viable supply of material to offset current reliance from DRC sourced cobalt.
The Millennium Cobalt Project:
Millennium is an advanced staged cobalt project with a large defined zone of cobalt-copper mineralisation which remains open at depth and along strike. Hammer Metals completed a JORC (2012) Resource estimate in late 2016 and reported 3.1 million tonnes of Inferred Resources* grading 0.14% Co, 0.34% Cu and 0.12 g/t Au (using a CuEq cut-off of 1.0%). Under Canadian reporting standards this resource is considered a “historic estimate”. The 2016 JORC (2012) resource estimate completed by Hammer Metals Ltd. outlined a mineralised zone over a strike length of approximately 1.5 km.
Cobalt-copper mineralisation is associated with shear zones hosted within a sequence of volcanic and sedimentary units. Additional mapping, soil geochemistry and rock sampling has identified an additional 1.5 km of anomalous cobalt-copper mineralisation in geological analogues that occur along a potential strike extension in the northern half (“Northern Target”) of the tenement package. This area has not been tested with any drilling to date. The Northern Target provides excellent opportunity to increase the overall resource potential of the Millennium project.
Prior to GEMC’s involvement, the area had been tested by 63 drill holes (percussion, RC and diamond) for a total of 7,891 metres. Most holes have been drilled within 200 metres of surface, with few holes reaching to depths greater than 250 metres below surface. At present mineralisation remains open at depth along the strike extent of the JORC (2012) resource area.
The Mt. Isa Projects:
The Mt. Isa Projects present as an excellent opportunity to acquire high-grade, underexplored assets in close proximity to a processing solution as well as stand-alone potential.
Exploration to date has returned outstanding, high-grade intercepts and there is excellent potential to significantly improve the understanding of the projects with with multiple high grade targets awaiting further exploration and testwork. Significant cobalt intercepts include:
- Mount Dorothy exploration drilling:
- 7m @ 0.14% Co, 2.55% Cu
- 2m @ 0.12% Co, 0.13% Cu
- Cobalt Ridge exploration roc chip sampling:
- 0.31% Co, 3.63% Cu, 1.25g/t Au
The deposits and prospects are similar in size and style to other deposits in the region that have been successfully mined by small-scale open pit techniques which implies that the project mineralisation may be economically extracted.
The Mt Isa Inlier is a highly mineralised, established, world class mining jurisdiction with significant regional infrastructure several world-class copper-gold-cobalt and lead-zinc-silver mines and deposits, including CuDeco Limited’s operating Rocklands copper-gold-cobalt project.
*This work was based on a technical report by Haren Consulting Pty Ltd., issued November 29, 2016 conforming to JORC (2012) reporting standards for resources estimates. As Hammer uses JORC (2012) categories, it should be noted that the confidence in the estimate of JORC (2012) inferred mineral resources is usually not sufficient to allow the results of the application of technical and economic parameters to be used for detailed planning. For this reason, there is no direct link from an inferred resource to inferred resource as defined under NI 43-101. However, the Company deems this resource still relevant because economic parameters have not changed significantly since publication date and the Company has confidence in the estimate based on review of technical data. A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves and the issuer is not treating the historical estimate as current mineral resources or reserves. CuEq% = Cu% +(Co%*5.9) +(Au ppm*0.9) +(Ag ppm*0.01). Price assumptions utilised by Hammer for the JORC (2102) resource estimate and drill hole intercepts are (in USD); Au - $1,300/oz, Ag - $20/oz, Co - $27,000/t and Cu - $4,600/t
Qualified Person
Mr. Paul Sarjeant, P. Geo., the Company’s VP Projects and Director, 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.
Global Energy Metals Corporation
(TSXV:GEMC | OTCQB:GBLEF | FSE:5GE1)
Global Energy Metals is focused on offering security of supply of cobalt, a critical material to the growing rechargeable battery market, by building a diversified global portfolio of cobalt assets including project stakes, projects and other supply sources. GEMC anticipates growing its business by acquiring project stakes in battery metals related projects with key strategic partners. Global Energy Metals currently owns and is advancing the Werner Lake Cobalt Mine in Ontario, Canada and has entered into an agreement to earn-in to the Millennium Cobalt Project in Mt. Isa, Australia.
For Further Information:
Global Energy Metals Corporation
#1501-128 West Pender Street
Vancouver, BC, V6B 1R8
Email: info@globalenergymetals.com
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.