REG - Chesterfield Res Plc - Sale of Adeline Project

Chesterfield ResourcesAnnouncement

19/10/2022 07:00

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RNS Number : 3314D  Chesterfield Resources PLC  19 October 2022

Chesterfield Resources PLC / EPIC: CHF / Market: LSE / Sector: Mining

 

19 October 2022

CHESTERFIELD RESOURCES PLC

("Chesterfield" or the "Company")

 

SALE OF ADELINE PROJECT FOR CASH AND SIGNIFICANT STAKE IN CANADIAN EXPLORER

 

Chesterfield Resources plc is pleased to announce that it has signed an
Agreement with Pacton Gold Inc. ("PAC.V") ("Pacton"), a TSX-V listed
exploration company with regard to Chesterfield's Adeline project in Labrador.
The agreement is conditional, inter alia upon the approval by the relevant
authorities at the TSX Venture Exchange, and a successful equity raise by
Pacton.

 

Under the terms of the agreement, Chesterfield's Canadian subsidiary
Chesterfield (Canada) Inc. will sell its 100% interest in its Adeline licences
to Pacton in exchange for a combination of cash and shares in Pacton. As a
result Chesterfield (Canada) Inc. will become a significant shareholder in
Pacton, obtain a seat on Pacton's board and will actively participate in the
development of the Adeline project. Chesterfield's board anticipates that the
development of the Adeline project will therefore be able to progress much
more quickly and effectively than would have been the case had Chesterfield
pursued the funding and carried out this work on its own. Chesterfield
shareholders will continue to have exposure to any discovery at Adeline
through Chesterfield (Canada) Inc's 19.99% post funding dilution stake in
Pacton. For reference, Pacton is currently valued at CAD12.99m (£8.4m).
Chesterfield's ability to sell its shares in Pacton will be restricted
according to certain terms detailed in the agreement and all payments are
subject to potential tax liability in Canada.

 

Chesterfield Executive Chairman Paul Ensor said, "This agreement follows a
process during which the Adeline project was reviewed by a number of
potentially interested groups. Our pre-requisites in choosing a partner
included the following: 1) the ability to promptly fund the next stage of work
in Labrador 2) technical competence to carry out and successfully complete all
necessary work to yield the quickest and best possible results from our
Adeline licences and 3) a track record of past success in previous similar
endeavours. Pacton fulfils all of these criteria. This is a good deal for
Chesterfield in many respects, as it values Adeline on fair terms, whilst also
potentially capturing additional value as the project is advanced. We look
forward to working closely with Pacton to deliver the best possible value from
Adeline to our shareholders as quickly as possible."

 

Pacton President and CEO Nav Dhaliwal said "Proven high-grade showings and
drill ready targets make Adeline an ideal property for rapid exploration. We
have an award winning in-house technical team and management with a track
record for increasing shareholder wealth. With the early-stage exploration
already complete, Pacton will be looking to commence drilling this remarkable
property at the earliest opportunity."

 

 

 

KEY COMMERCIAL TERMS

 

·      Pacton will issue consideration shares to Chesterfield equal to a
19.99% share of the post dilution outstanding share capital of Pacton.

·      Pacton will pay Chesterfield a total of CAD1.25m (£804,000) in
staged payments over a period of 12 months.

·      Pacton and Chesterfield will agree a development programme to be
carried out by Pacton.

·      Chesterfield will advise Pacton for a defined handover period
post completion and will receive additional compensation of CAD300,000 (c
£193,000) for this work of during the transition period.

 

 

ABOUT PACTON GOLD

 

Pacton is a Canadian exploration company with key strategic partners focused
on the exploration and development of high-grade mineral resource properties
in Ontario, Canada. The Company also owns a strategic portfolio of prospective
projects in Western Australia and Canada.

 

 

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed
inside information for the purposes of Article 7 of Regulation (EU) No
596/2014 until the release of this announcement.

 For further information please visit www.chesterfieldresourcesplc.com
(http://www.chesterfieldresourcesplc.com) or contact:

 Chesterfield Resources plc                                  Paul Ensor, Executive Chairman  Tel: +44 (0) 7595 219 011
 First Equity Limited (https://www.brandonhillcapital.com/)  Jason Robertson                 Tel: +44 20 7330 1883

 

 

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