(TheNewswire)
Vancouver, British Columbia – TheNewswire - (April 5, 2024) – African Energy Metals Inc. (TSXV: CUCO; FSE: BC2; WKN:A3DEJG) (“ African Energy Metals” or the “ Company ”) has signed a definitiveagreement with Voyageur Mineral Explorers Corp.(“ Voyageur ”) (the “ Definitive Agreement ’) to earn a 100%interest in the Mink Narrows Group high-gradepolymetallic copper VMS project (the “ Project ”) locatedin the prolific Flin Flon Manitoba VMS mining camp. The Project islocated 25 km southeast of Flin Flon, Manitoba.
Highlights:
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Project subject of extensive exploration byFalconbridge Ltd. (“Falconbridge”) and HudBay Minerals Inc.(“HudBay”) with over 15,000 m of drilling and multiple geophysicalprograms.
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Polymetallic copper deposit(copper/zinc/nickel/gold/silver/cobalt) with four distinct metalregions contained in 54 claims in the 72.4 km² contiguousproperty.
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Historical non-compliant resource with average gradesof 1.5% copper and 0.5% zinc with one zone from surface to 500 m andopen to depth and strike.
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Drill Hole MN-00-38 intersected 4.17% copper, 0.34%zinc, 11.8g/t silver and 255 ppb gold over 4.1 m.
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Project is located 25 km from Flin Flon and istraversed by a provincial road and power lines, 500 meters from railand 2 km from the Flin Flon airport.
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Flin Flon has a long history as a mining town and FlinFlon camp has produced over 170 million tons of sulphide ore from 31VHMS deposits with over $1.6 billion invested in the region for road,rail, power, and water infrastructure to facilitate quick developmentof new discoveries. (2002 NRC Current Research).
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Located 27 km from the HudBay zinc copper processingfacility and 777 copper-zinc mine.
The Project represents a substantial opportunity todevelop a copper/zinc/gold/silver/nickel polymetallic deposit withinthe Flin Flon mining camp, a camp known globally for its extensivemineral richness and existing infrastructure.
Stephen Barley, Executive Chairman stated: "We arevery excited to announce this transformational agreement, which willallow us to fulfill our vision of establishing a diversified metalscompany in Manitoba. This Project has the potential to develop acompany-making asset in Manitoba, the best mining province in Canada.Through the high-quality work completed by Falconbridge and HudBay ,we are starting with a significant amount of technical informationwhich will allow us to accelerate an aggressive work program with ahigh level of confidence. One of the key assets is the Project comeswith a geological technical support team located in Flin Flon withover 70 years of combined experience in the region and with existingstrong relationships with local partners and suppliers.”
Benefits to African Energy Metalsshareholders :
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The Project establishes a district-scale opportunitywith four separate and distinct high-potential targets with varyingmetals.
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Transformational agreement with Voyageur - couldtransform the Company into an immediate exploration leader in theregion.
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Excellent growth potential – the Copper Reef copperzinc deposit is open for expansion at depth and on strike, and basedon completed geophysical work there is significant growth potential inthe resource and the potential for a parallel new deposit.
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Experienced partners and team members – key memberswill be continuing their work on the Project as either technicaladvisors or as senior management or Directors of African Energy Metalsand all have strong ties to the Flin Flon mining community.
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Quality jurisdiction – Manitoba is a top miningjurisdiction with significant access to capital for exploration anddevelopment, which are eligible for critical mineral exploration taxcredits and Manitoba super flow-through exploration tax credits aswell as the Manitoba Minerals Development Fund (MMDF) which is aprovincial fund, administered by the Manitoba Chambers of Commerce,that provides funding for northern economic development and miningprojects that create Indigenous partnerships, increase localemployment and stimulate investment in Northern Manitoba.
The Mink Narrows Group located on the southern marginof Arc rocks in the main Camp has significant polymetallic growthpotential. It has geological similarities to the Coronation, Birch andKonuto Mines Trend located in the western margin of the main Flin Floncamp in Saskatchewan which are also hosted by a primitive arcsequence, dominated by mafic volcanic rocks with copper-rich deposits.Reference to this nearby property is for information only and thereare no assurances that the Company will achieve the same results atthe Mink Narrows Group project.
The Flin Flon belt (FFB) is one of the largestProterozoic volcanic-hosted massive sulphide (VMS) districts in theworld, containing 27 Cu-Zn-(Au) deposits from which more than 162million tonnes of sulphide have already been mined or are indevelopment within these deposits. The FFB is composed of structurallyjuxtaposed volcanic and sedimentary assemblages that were emplaced ina variety of tectonic environments. The major 1.92–1.88 Gacomponents (tectonostratigraphic assemblages) of the central Flin Flonbelt include aerially significant juvenile arc and juvenileocean-floor rocks (Mid Oceanic Ridge Basalt (MORB)), and minorcontaminated arc, ocean-plateau and ocean-island basalt. Most of themined VMS deposits in the Flin Flon belt are associated with thejuvenile arc volcanic rocks. Gold mineralization in the FFB is lessthoroughly studied but at Flin Flon has been shown to be intimatelyassociated with late brittle-ductile shear zones that follow peaktectonic and metamorphic activity within the Trans-Hudson Orogen. Thewestern part of the property is dominated by volcanic rocks while theeastern part of the property is dominated by plutonic rocks. In thewestern part of the property the geology consists of a sequence ofnortheast-trending volcanic rocks and gabbroic dykes and sills thattrend through the Mink Narrows area of Lake Athapapuskow through PayukLake to the Twin Lakes area. These lithologies are bound by a seriesof major NE to ENE trending faults most notably the Mistik Creek ShearZone (to the north) and the Payuk Lake fault (to the south).Historically, all of the volcanic rocks have been interpreted to havearc volcanic polymetallic and semi-massivepolymetallic sulphide lenses extending over a kilometric strike lengthwithin a strongly dipping basin filled by felsic volcanism products.Sulphide-rich mineralization is mostly hosted in rhyolite andassociated tuffs. Two main types of mineralization characterize theCopper Reef deposit. Prior drilling has established the continuitydown to a vertical depth of 500 meters.
Project summary
Location: The Project comprises 54 claims covering 72.4km² (7,240 hectares) in the Flin Flon mining camp in west centralManitoba. There are year-round access roads; nearby railways, and apower line running through the Project.
History: The Mink Narrows property has a long historyof mineral exploration beginning in the 1920s when the first claimswere staked. Exploration for VMS style mineralization was initiallyreported by Buckham (1942) when the Copper Reef mineralization wasfirst described. Early prospecting also focused on epigenetic goldmineralization, particularly in the Payuk, Neso and B.C. Lake areastargeting mineralization led to the discovery of small gold depositssuch as the Joplin, Payuka, Parres, Neso Lake Gold and Goldomedeposits.
Resource: In 1969, Falconbridge produced a historicmineral resource estimate on the Copper Reef Deposit (Karup-Moller1969) of over 500,000 tons with an average grade of 1.5% copper and.5% zinc. Although the resource and data are considered reasonable,they cannot be verified. It is not a NI 43-101compliant resource estimate and should be considered historical andthe Company does not consider this to be a current resource. Theresource estimate is relevant to ongoing exploration activities on theProject. It provides a starting resource for further exploration inand around the Copper Reef Deposit and it provides a target deposittype for continued exploration along strike from the deposit andelsewhere in the Mink Narrows Property. There are no other more recentresource estimates.
Expansion Potential
The Copper Reef deposit has a continuous strike lengthof 0.4 km with additional mineralization on strike with similargeology and alteration. The deposit is drilled to a depth of 500m andopen to depth. The deposit shows expansion potential at depth withpotential other deposits on strike.
Given the nature of the VMS systems typically observedin the Flin Flon camp, the Company, therefore, believes that thegrowth potential is significant and will provide further details inupcoming releases to highlight its exploration plan.
NI 43-101 Technical Report
A compliant NI 43-101 Technical Report has beencompleted on the Mink Narrows Group of projects by John G. PearsonM.Sc. P.Geo., FGC, FEC (Hon) dated January 23, 2023, and reissued onMarch 25, 2024. A copy of the report will be filed on SEDAR after areview has been completed by the TSX Exchange Venture.
Terms of the DefinitiveAgreement:
Under the terms of the Definitive Agreement dated April4, 2024, African Energy Metals has the right to earn a 100% interestin the Project through the exercise of an option on the Property withan exploration earn-in requirement of CAD$ 1,000,000 over a four-yearperiod as set out in the table below. The Project is subject to a netsmelter return royalty of 2% granted to Voyageur. In addition to theexploration expenditures, the Definitive Agreement requires theissuance of the greater of 1,800,000 common shares of the Company or$300,000 worth of common shares of the Company at a minimum value of$0.045 per common share to Voyageur over the term of the agreement.The Company has agreed to pay a maximum of $55,000 to Voyageur overthe term of the agreement. Voyageur is arm’slength party to the Company. The share issuances and payments underthe Definitive Agreement are subject to the approval of the TSXVenture Exchange.
The Project was the subject of an existing optionagreement between Voyageur and Laser Gold Resources Inc.(“ Laser Gold ”). Laser Gold has agreed to terminate the earlier optionagreement pursuant to a compensation agreement dated April 4, 2024,with the Company (the “ Compensation Agreement ”). Under the terms ofthe Compensation Agreement, the Company has agreed to issue 4,000,000common shares and pay CAD$40,000 to Laser Gold. The terms of theCompensation Agreement provide that the shares to be issued to LaserGold may be issued in tranches and will not be issued until such timeas Laser Gold will not be holding shares of the Company that exceed9.9% of the issued and outstanding shares of the Company. Laser Goldis arm’s length party to the Company and to Voyageur. The shareissuances and payments under the Compensation Agreement are subject tothe approval of the TSX Venture Exchange.
OPtioned Property – Mink Narrows | |||
Time of Commitment | Cash or Royalty Payment | Consideration Shares | Dollar value of Work Commitment |
Upon TSX Venture Exchange approval | $10,000 in cash | 200,000 | |
On or before August 14 th , 2024 | The greater of 200,000 or $20,000 in ConsiderationShares based on the ten-day volume weighted average trading price ofthe common shares of the Company at the time of issuance | $300,000 | |
On or before August 14 th , 2025 | The greater of 200,000 or $40,000 in ConsiderationShares based on the ten-day volume weighted average trading price ofthe common shares of the Company at the time of issuance | $100,000 | |
On or before April 14 th , 2026 | $10,000 in cash | The greater of 300,000 or $60,000 in ConsiderationShares based on the ten-day volume weighted average trading price ofthe common shares of the Company at the time ofissuance | $200,000 |
On or before April 14 th , 2027 | $10,000 in cash | The greater of 400,000 or $80,000 in ConsiderationShares based on the ten-day volume weighted average trading price ofthe common shares of the Company at the time of issuance | $200,000 |
On or before April 14 th , 2028 | $25,000 in cash | The greater of 500,000 or $100,000 in ConsiderationShares based on the ten-day volume weighted average trading price ofthe common shares of the Company at the time of issuance | $200,000 |
On the Exercise Date | Royalty 2% NSR (1) | ||
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Concurrent with the closing of the acquisition of theProject, the Company has agreed to appoint Richard Masson as Presidentand CEO of the Company. The Company has also agreed to appoint JimEngdahl as a director of the Company. Mr. Engdahl is currently theChairman of Laser Gold, which is a private company.
Concurrent Part and Parcel PrivatePlacement and Future Private Placements
The Company intends to complete a non-brokeredconcurrent part and parcel private placement (the “ Financing ”) of upto 3,000,000 units (each a “ Unit ”) at a price of CAD $0.05 per Unit foraggregate proceeds of CAD $150,000. Each unit will consist of onecommon share of the Company (a “ Share ”) andone-half of one common share purchase warrant (with two half warrantsbeing a “ Warrant ”). Each Warrant will entitle theholder thereof to acquire one additional common share in the capitalof the Company (a “ WarrantShare ”) at a price of $0.075 per Warrant Shareat any time prior to 5:00 p.m. (Vancouver time) on the date that is 12months following the closing date and at a price of $0.10 per WarrantShare at any time prior to 5:00 pm (Vancouver time) on the date thatis 24 months following the closing date. The Warrant may be subject toaccelerated exercise provisions.
The proceeds from the Financing will be used for general workingcapital purposes primarily relating to the approval and closing of theProject acquisition. In connection with the Financing, the Company maypay finder’s fees in cash or securities or a combination of both, aspermitted by the policies of the TSX Venture Exchange.
The securities issued pursuant to the Financing will besubject to a hold period under applicable securities laws, which willexpire four months plus one day from the date of closing of theFinancing. Closing of the Financing is subject to receipt of allnecessary corporate and regulatory approvals, including approval ofthe TSX Venture Exchange.
The Company intends to announce additional privateplacements, both flow-through and non-flow-through to fund explorationwork on the Project and for general working capital. The Companyreasonably anticipates the additional private placements will resultin significant dilution.
Finder’s Fees
In connection with the acquisition of the Project, theCompany intends to issue up to 1,066,666 common shares as finder’sfees to arm’s length parties, as permitted by the policies of theTSX Venture Exchange. The shares will be issued to Axiom ExplorationGroup Ltd. (as to 533,333 shares) and to Lockwood Financial Ltd. (asto 533,333 shares). The securities issued pursuant to the Finder’sFees will be subject to a hold period under applicable securitieslaws, which will expire four months plus one day from the date ofclosing of the acquisition of the Projects and is subject to receiptof all necessary corporate and regulatory approvals, includingapproval of the TSX Venture Exchange.
Debt Settlement
The Company has agreed to settle $210,000 of debt owing to itsconsultants, creditors, and insiders by issuing 4,200,000 Shares inthe capital of the Company at a deemed price of $0.05 per Share. Nowarrants will be issued in connection with the debt settlement.
The debt settlement transaction is subject to the approval of the TSXVenture Exchange, and all Shares issued pursuant to the debtsettlements will be subject to a four-month statutory hold period. Thedebt settlement will not create a new control person.
The Company believes it is in the best interests of its shareholdersto reduce the amount of indebtedness to improve its financial positionand allow for the acquisition and funding of the Project.
The issuance of a portion of the Shares constitutes a Related PartyTransaction within the meaning of Multilateral Instrument 61-101, asdirectors and officers of the Company will receive an aggregate of1,500,000 Shares. All the directors of the company without a materialinterest in the debt settlement, acting in good faith, considered thedebt settlement and have determined that the value of theconsideration received by the Company is fair and reasonable. TheCompany is relying on exemptions from the formal valuation andminority approval requirements of MI 61-101 contained in sections5.5(a) and 5.7(1)(a) of MI 61-101 as the fair market value of the debtsettlement insofar as it involves related parties, does not exceed 25%of the market capitalization of the Company.
Name Change
Concurrent with or prior to the closing of the acquisition of theProject, the Company intends to change its name to Copper ReefMinerals Inc. and to change the Company’s trading symbol to betterreflect the new focus of the Company. A further announcement will bemade regarding the name change. There will be no share consolidationwith the name change.
Qualified Person
This press release was reviewed and approved by StephenMasson, MSc., P. Geo, who is a qualified person as defined underNational Instrument 43-101, and responsible for the technicalinformation provided in this news release . |
African Energy Metals is a natural resource company with a focus onthe acquisition, exploration, development, and operation of criticalmetals projects in the Manitoba Flin Flon mining belt. African EnergyMetals will have an experienced management and exploration teamlocated in Flin Flon Manitoba.
For further information, please contact:
Stephen Barley, Executive Chairman Phone: +1-604-428-7050
Email: info@africanenergymetals.com Website: www.africanenergymetals.com
Reader Advisory
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.
This news release may containforward-looking information within the meaning of applicablesecurities laws. All information and statements other than statementsof current or historical facts contained in this news release areforward-looking information.
Forward-looking statements aresubject to various risks and uncertainties concerning the specificfactors disclosed here and elsewhere in African Energy Metals’periodic filings with Canadian securities regulators. When used inthis news release, words such as "will", "could","plan", "estimate", "expect","intend", "may", "potential","should," and similar expressions, are forward- lookingstatements. Information provided in this document is necessarilysummarized and may not contain all available material information.
Forward-looking statements includethose in relation to African Energy Metals’ ability to close on theacquisition of the Project; in relation to satisfying TSX VentureExchange requirements in connection with the acquisition, the debt settlement, the finder’sfees, the private placements; the acceptance of the NI 43-101technical report, to completing the concurrent private placement, andfurther private placements. Although African Energy Metals believesthe expectations reflected in such forward-looking statements arebased on reasonable assumptions, it can’t make any assurances thatits expectations will be achieved. Such assumptions may proveincorrect.
Factors that could cause actualresults to differ materially from expectations include (i) potentialdelays due to COVID-19 restrictions; (ii) the failure of AfricanEnergy Metals’ projects, for technical, logistical, labourrelations, or other reasons; (iii) a decrease in the price of mineralsbelow what is necessary to sustain the African Energy Metals’operations; (iv) an increase in the cooperating costs above what isnecessary to sustain its operations; (v) accidents, labour disputes,or the materialization of similar risks; (vi) generally, AfricanEnergy Metals’ inability to develop and implement its successfulbusiness plans for any reason.
In addition, the factors describedor referred to in the section entitled “Risks Related to theCompany’s Business” in the Company’s Management Discussion andAnalysis for the year ended December 31, 2023 and 2022, which isavailable on the SEDAR at www.sedarplus.ca, should be reviewed inconjunction with the information found in this news release.
Although African Energy Metals hasattempted to identify important factors that could cause actualresults, performance, or achievements to differ materially from thosecontained in the forward- looking statements, there can be otherfactors that cause results, performance, or achievements not to be asanticipated, estimated, or intended. There can be no assurance thatsuch information will prove to be accurate or that management'sexpectations or estimates of future developments, circumstances, orresults will materialize. As a result of these risks anduncertainties, no assurance can be given that any events anticipatedby the forward-looking information in this news release will transpireor occur, or, if any of them do so, what benefits that African EnergyMetals will derive therefrom. Accordingly, readers should not placeundue reliance on forward-looking statements.
The forward-looking statements inthis news release are made as of the date of this news release, andAfrican Energy Metals disclaims any intention or obligation to updateor revise such information, except as required by applicablelaw.
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