TIDMFMET
RNS Number : 1393V
Fulcrum Metals PLC
30 November 2023
30 November 2023
Fulcrum Metals plc
("Fulcrum" or the "Company" or the "Group")
Option to Acquire Teck-Hughes Gold Tailings Project
Enters Advanced Discussions with Extrakt to Licence its
Sustainable Gold Leaching Technology
Fulcrum Metals plc (LON: FMET), a company focused on mineral
exploration and development in Canada , is pleased to announce that
its wholly owned subsidiary Fulcrum Metals (Canada) Ltd ("FMCL")
has entered into an option agreement ("the Mining Option
Agreement") to acquire a 100% interest in the Teck Hughes Gold
Tailings project ("Teck-Hughes"), located in Kirkland Lake,
Ontario, Canada.
In addition, the Company also announces that, in parallel with
the Mining Option Agreement, it is in advanced discussions with
Extrakt Process Solutions ("Extrakt"), regarding the licensing of
its proprietary technology. Extrakt is a sustainable technology
company using separation technology to extract metals from tailings
without the use of cyanide.
Highlights
-- Option to acquire 100% of the Teck-Hughes Gold Tailings
Project - the mine itself has historically milled 9,565,302 tons of
ore and produced 3,700,007 ounces of gold.
-- Historic sampling and auger drilling campaigns were conducted
at the project, the first in 1980 and the most recent between 2018
and 2022 which produced a non-complaint resource estimation.
o As part of the most recent campaign a total of 95 auger
samples were collected and assayed at Actlabs in Timmins. The
highest sample assayed 1.23g/ton Au with 72 of the 95 samples
assaying between 0.5 to 0.8 g/t Au, the average being 0.66g/ton
Au.
o Based on the data from this sampling along with that of the
drill program from 1980 an estimate of the tonnage was calculated
over the north, west and northeast arm of the tailings totalling
6,531,300 tons of material at 0.66g/ton Au for 138,460 ounces
contained Au.
-- The Company is in advanced discussions with Extrakt for the
use of its proven non-cyanide gold leaching tailings extraction
technology.
-- Testing of tailing material from Teck-Hughes, using Extrakt's
technology, is scheduled for Q1 2024.
-- This represents an opportunity for Fulcrum to utilise proven
tailings extraction technology with the potential to deliver a cash
generative metals project.
Ryan Mee, Chief Executive Office of Fulcrum Metals plc,
commented:
"This is a very exciting development at Fulcrum and an excellent
opportunity for shareholders to gain exposure to a project that has
the potential to be generating cashflow in the future, without the
precursor mining stage saving not only time but capital.
"Our strategic structuring of the tailings project agreement
allows Fulcrum to conduct the necessary pre-production work without
the upfront commitment of the acquisition cost, which based on the
non-compliant resource calculations of 121,700 ounces of gold
equates to less than USD$3.30 per ounce of gold.
"We are also excited about our discussions with Extrakt, whose
technology has the potential to have a significant impact on the
metals industry. Importantly, the non-use of cyanide makes is
pivotal from an operational cost perspective, and even more
importantly from an environmental perspective. We look forward to
providing shareholders on our progress at Teck-Hughes in due
course".
The Teck-Hughes Gold Tailings project is located approximately
1.5 kilometres northwest of the town of Kirkland Lake (figure 1)
consisting of 7 mining claims (112 hectares) with non-compliant
43-101 resource calculations of up to 138,460 ounces of gold
associated with the historic Teck Hughes gold mine in the Kirkland
Lake camp.
Fulcrum Metals is also in discussions with Extrakt to licence
efficient and sustainable, separation technology to enhance
recoveries of precious metals and dewater the tailings after the
process. Fulcrum will update its project process once all sides
have finalised the scopes and executed the necessary agreements.
William Florman, the CEO of Extrakt, confirmed that the material
testing from one of Fulcrum's sites is targeted to be conducted in
Q1 2024.
Summary of Acquisition Terms
Mining Option Agreement
Under the terms of the Mining Option Agreement, John Der
Weduwen, Larry Gervais and Steve Polson (the "Optionors") grants
Fulcrum (the "Optionee") an option to acquire a 100% interest in
the Teck-Hughes Tailings Project. In consideration for the grant of
the option Fulcrum shall make payments to the Optionors as
follows:
-- CDN$15,000 within 10 business days of signing the Mining Option Agreement;
-- CDN$25,000 within 10 business days upon the receipt by
Fulcrum of a mineral recovery permit from the Ministry of Mines in
Ontario;
-- CDN$250,000 on or before the first anniversary date of the Mining Option Agreement;
-- CDN$250,000 on or before the second anniversary date of the Mining Option Agreement; and
-- the granting of a 3% Net Smelter Return (the "NSR Royalty").
Once the payments above have been made, which at Fulcrum's
discretion can be made in full prior to the stated dates, Fulcrum
may exercise the option to acquire a 100% interest in the
Teck-Hughes Tailings Project.
Fulcrum also has the right to terminate the Mining Option
Agreement by giving 30 days notice at any time and as such would
not be required to make any further payment.
Buy Back of Royalty
In addition, FMCL has an option to purchase 1.5% of the NSR
Royalty (thereby reducing the NSR Royalty rate payable to the
Optionors from 3% to 1.5%) for CAD1,500,000, with an additional
option to purchase a further 0.5% of the original NSR Royalty
(thereby reducing the NSR Royalty rate payable to the Optionors
from 1.5% to 1.0%) for a further CAD$1,000,000 at any time or from
time to time, after the NSR Royalty has been granted.
Finder's fee agreement
The Company has also entered into a finder's fee agreement in
relation to the acquisition whereby the Company will pay the
introducer of the Project a finder's fee of CDN$20,000 in stages of
CDN$1,000 upon execution of the Mining Option Agreement, CDN$9,000
payable on payment of the first anniversary option amount and
CDN$10,000 payable on payment of the second anniversary option
amount. The Company has elected to make the first payment
instalment in cash but may elect to pay either in cash or shares in
Fulcrum for the remaining payments. In the event that the remaining
payments are settled through new ordinary shares in Fulcrum this
would be at a price per share based on the ten-day volume weighted
average price of shares in Fulcrum Metals prior to exercise.
Background on the Teck-Hughes Tailing Project
The Teck-Hughes Gold Mine milled 9,565,302 tons of ore and
produced 3,700,007 ounces of gold during its 51 years of operation
from March 1917 to January 1968. The tailings from the milling
operation were pumped approximately 2100 metres north into Lost
Lake and were later held with wooden dams when the lake was filled
to overflowing capacity.
In August of 1980 a nine-hole drill program was conducted by
Douglas Parent on behalf of Rene Paiement and associates. The drill
holes were centred at 500-foot intervals along a line which ran NNE
from the southwest corner of the tailings to the north central
portion.
The nine holes returned an average grade of 0.63g/ton Au. The
grades were higher in the south and steadily decreased to the
north. Mr. Parent suggested the lower grades in the north were due
to leaching. It is more likely that the older tailings were
deposited in the nearest shore of the lake, hence the higher grades
to the south.
In July of 1985 C. Von Hessert commissioned a drill program on
five tailings areas in the Kirkland Lake District, one being the
Teck-Hughes with drill centres spaced ranging from 400 to 600 feet.
Based on these results it was roughly estimated that the
Teck-Hughes Tailings project may contain approximately 6,212,000
tons of material grading 0.62 g/ton Au for 121,700 contained gold
ounces .
In 2018 and 2019 a total of 85 surface auger samples were taken
by Jon Van Der Weduwen. The samples were taken at 50-metre stations
along 100-metre line spacing. The samples covered most of the
tailings surface except for the extreme NE portion. The average
grade of these surface samples was .60g/ton Au.
In 2022 John Van Der Weduwen completed seventeen augur drill
holes totalling 108.4 metres ranging in depth from 3.6m to 9.2m,
although several holes did not reach the bottom of the tailings due
to the collapse of walls of the holes. The holes were centred at
stations of a previously established north-south UTM grid where the
lines were spaced 100m and stations at 50m. All holes were drilled
vertically and sampling starting at the 1-2 metre depth with
sampling every metre to depth (data for the first metre was
collected during earlier work).
A total of 95 auger samples were collected and assayed at
Actlabs in Timmins. The highest sample assayed 1.23g/ton Au with 72
of the 95 samples assaying between 0.5 to 0.8 g/t Au, the average
being 0.66g/ton Au. There were no marked anomalies at the lower
extent of the holes where the older tailings would be. Based on the
data from this sampling along with that of the drill program from
1980 an estimate of the tonnage was calculated over the north, west
and northeast arm of the tailings totalling 6,531,300 tons of
material at 0.66g/ton Au for 138,460 ounces contained Au.
The various historic non-compliant resource estimates cited
above have not been verified by Fulcrum and the tailings body
requires detailed follow-up sampling along with appropriate QAQC
and estimation by an independent qualified resource geologist in
order to be able to report a resource compliant with established
resource codes.
Figure 1 - property location
References
i) Twenty eighth annual report of the Ontario Bureau of Mines,
1919 p. 120-121, Teck Hughes Gold Mines.
ii) Seventy eighth annual report on mining operations in
Ontario, 1968 p. 33-34, Teck Hughes annual report.
iii) OAFD Assessment record 42A0 1 NE0 194, Report on sampling
program completed on the Teck Hughes tailings deposit.
iv) OAFD Assessment record 32D04NW0806, Appendix B, Calculation
of tailings reserves in the Kirkland Lake Area.
Qualified Person Statement
The technical information in this announcement has been reviewed
by Edward (Ed) Slowey, BSc, PGeo, technical advisor to Fulcrum
Metals Plc. Mr Slowey is a graduate geologist with more than 40
years' relevant experience in mineral exploration and mining and a
founder member of the Institute of Geologists of Ireland. Mr Slowey
has sufficient experience relevant to the style of mineralisation
and type of deposit under consideration and to the activity which
has been undertaken to qualify as a "Qualified Person" in
accordance with the AIM Rules Guidance Note for Mining and Oil
& Gas Companies. Mr Slowey consents to the inclusion in the
announcement of the matters based on their information in the form
and context in which it appears.
-Ends-
For further information please visit https://fulcrummetals.com/
or contact:
Fulcrum Metals PLC
Ryan Mee (Chief Executive Officer) Via St Brides Partners
Limited
Allenby Capital Limited (Nominated
adviser)
Nick Athanas / George Payne T el: +44 (0) 203 328
5656
Clear Capital Markets Limited (Broker)
Bob Roberts T el: +44 (0) 203 869
6081
St Brides Partners Ltd (Financial
PR)
Ana Ribeiro / Paul Dulieu Tel: +44 (0) 20 7236
1177
Notes to Editors
FULCRUM METALS - BACKGROUND
Fulcrum Metals PLC (LON: FMET) is an AIM quoted exploration
company which finances and manages exploration projects focused on
Canada, widely recognised as a top mining jurisdiction.
Fulcrum currently holds a beneficial 100% interest in highly
prospective gold and base metals projects in Ontario and Uranium
projects in Saskatchewan.
Fulcrum's strategy is to focus on discovery and
commercialisation of its Projects through targeted exploration
programmes. The primary focus is to make an economic discovery on
the flagship Schreiber-Hemlo Properties and to establish the
prospectivity of its wider Ontario and Saskatchewan portfolio with
a view to securing potential joint venture and/or acquisition
interest.
The Schreiber - Hemlo properties have a history of prospecting
and localised extraction since the late 19th century. However,
coherent property-level exploration programmes have been limited or
absent, particularly in recent times. Fulcrum has an opportunity to
carry out such a programme and this approach provides the best
opportunity to fully explore the significant prospectivity of the
properties. A recent structural study identified 42 priority
exploration targets, of which 24 targets within the Big Bear
property and 18 in the Jackfish property, with 14 in total (9 on
Big Bear and 5 on Jackfish) being ranked as high priority for
follow-up. The properties have the potential to host a large,
structurally controlled, stratabound-style banded iron formation
(BIF) gold prospect similar to the Musselwhite deposit (McNicoll et
al., 2016), in addition to an Archean greenstone, orogenic-style
lode gold prospect, extending past the bounds of known historical
mineral occurrences.
The Tully property, 458 hectares in area, is located 30
kilometres northeast of Timmins, Ontario and includes the Tully
(Timmins North) deposit, which has been the focus of several
drilling campaigns since its discovery in 1969. The Tully deposit
is located 2 kilometres southwest of the Bradshaw Gold Project of
Gowest Gold Ltd., currently in development. The property is
accessed by an all-weather gravel road that extends 15 kilometres
to the east off of highway 655.
While highly prospective, Fulcrum's mining assets are in the
exploration phase, so Fulcrum stands to be able to add
significantly to the inherent value through exploration success.
Fulcrum will continually review opportunities with potential and
with a view to increasing shareholder value. It is the Board's
intention to deliver medium and long-term growth and to establish
the Group as a significant exploration company.
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