REG - Fulcrum Metals PLC - Letter of intent for sale of Tully Gold property

Fulcrum MetalsAnnouncement

09/04/2025 07:00

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RNS Number : 2204E  Fulcrum Metals PLC  09 April 2025

This announcement contains inside information for the purposes of Regulation
11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310

 

Fulcrum Metals plc / EPIC: FMET / Market: AIM / Sector: Mining

 

 

9 April 2025

 

 

Fulcrum Metals plc

("Fulcrum" or the "Company" or the "Group")

 

Letter of intent for sale of Tully Gold property

 

Fulcrum Metals plc (LON: FMET), a technology led company focused on the
recovery of precious metals from mine tailings in Canada, is pleased to
announce that it has signed a binding letter of intent (the "LOI") with TSX
Venture Exchange listed Loyalist Exploration Limited ("Loyalist") for the sale
of the Company's 100% interest in the Tully Gold Project ("Tully" or the
"Project") in Timmins, Ontario.

 

Loyalist Exploration Limited is a recently restructured mineral exploration
company led by an experienced management and directors focused on acquiring,
exploring, and developing quality mineral properties in Canada. Loyalist
recently announced a strengthening of its portfolio through the addition of
the Loveland nickel/copper/gold property and the Gold Rush gold/silver
property, both located in the Timmins, Ontario mining district.

 

LOI highlights

·    Cash payment of CA$500,000 payable to Fulcrum on completion

·    89,255,000 common shares in Loyalist to be issued to Fulcrum
representing a shareholding of 19.9% in the issued share capital of Loyalist
upon completion (subject to adjustment) with an implied value of CA$892,550
based on a price of CA$0.01 per share

·    A 2% net smelter royalty ("NSR") to be granted to Fulcrum over the
Project with a CA$1,000,000 buy back for 1%

·    Potential future milestone payments to Fulcrum of CA$100,000 in cash
and 30,000,000 shares in Loyalist at a price of CA$0.01 per share or cash in
lieu

·    Exposure to multiple highly prospective projects in the Timmins
mining district

Ryan Mee, Chief Executive Officer of Fulcrum, commented:

"I am very pleased to announce the signing of the LOI with Loyalist over the
highly prospective Tully Gold Project in Timmins, Ontario. This transaction
aligns perfectly with our broader strategy to divest exploration assets and
focus on the development of our gold tailings projects in Kirkland Lake and
the potential commercial opportunities open to us.

"We believe that Tully is a high quality asset that is located in one of the
world's most prolific gold districts, and the terms retain significant
exposure for Fulcrum in the potential upside through the shareholding and the
milestone and royalty structure.

I look forward to working alongside Loyalist to closing this transaction."

Errol Farr, Loyalist's President & Chief Executive Officer, commented:

"We are very excited to announce the proposed acquisition of the Tully
property, which hosts a significant historical gold resource, numerous high
grade drill intersection and is open and along strike. The acquisition of
Tully along with the Gold Rush Gold property and the Loveland
Nickel/Copper/Gold property, all within the prolific Timmins mining camp,
builds on the company's strategy of becoming a serious mineral exploration and
development company."

Key terms of LOI

 

The binding LOI sets out the intention of both parties to enter into a
definitive agreement (the "Definitive Agreement") and formal purchase and sale
agreement by 30(th) June 2025. There can be no guarantee that a definitive
agreement will be entered into nor that the terms will be the same as set out
in the LOI and this announcement.  The LOI is also subject to, inter alia,
the satisfactory completion of due diligence by both parties.

Completion of the purchase agreement will result in the acquisition of a 100%
ownership of the Tully gold project by Loyalist. Pursuant to the terms of the
LOI, Loyalist will:

a)    pay to Fulcrum aggregate cash consideration of CA$500,000 upon
closing of the Purchase;

 

b)    issue approximately 89,255,000 shares in Loyalist to Fulcrum (with an
implied value of CA$892,550 based on a price of CA$0.01 per share) that will
result in Fulcrum having  ownership of 19.9% of the total issued and
outstanding common shares in Loyalist after giving effect to the Definitive
Agreement, completion by Loyalist of the acquisition of the option to acquire
the Gold Rush Property and the acquisition by Loyalist of the Loveland
property (both as previously announced by Loyalist) and the completion by
Loyalist of a total cumulative financing of a minimum of  CA$1.3 million or
more; and

 

c)    grant to Fulcrum a 2.0% NSR on the Project's mining claims with an
option for Loyalist to re-purchase 50% of the NSR (i.e. 1.0% of the 2.0% NSR)
at any time at a price of CA$1,000,000 (subject to CPI adjustment).

Additional Future Consideration

As additional consideration, Loyalist will: (1) pay to Fulcrum an aggregate of
CA$100,000 in cash; and (ii) issue to Fulcrum an aggregate of thirty million
(30,000,000) shares in Loyalist or cash in lieu thereof, in whole or in part,
at the sole discretion of Loyalist, at a price of CA$0.01 per Loyalist share,
in instalments upon the achievement of milestones on any part of the Property,
as follows:

 

a)    CA$100,000 upon the completion of a drilling intercept of at least 6
g/t of gold over 8 metres or equivalent on the Property payable and issuable
within sixty (60) days of the announcement of this milestone;

 

b)    15,000,000 shares in Loyalist upon filing of a technical report on
the Property where a gold resource is re-evaluated (or restated) to a NI
43-101 standard and the total gold resource exceeds 200,000 ounces, payable
and issuable within sixty (60) days of the technical report being filed under
the Purchaser's profile on SEDAR+; and

 

c)    15,000,000 shares in Loyalist at the time of announcement of a
decision to mine on the Property, payable within sixty (60) days of such
announcement.

 

Cash generated by Fulcrum on the sale of Tully would be used for Fulcrum to
support the Group's ongoing capital needs with a particular focus on the
Group's tailings projects in the Kirkland Lake region of Ontario.

 

Tully Project overview

 

Tully is located 25 kilometres northeast of Timmins and includes an historic
Indicated and Inferred Mineral Resource consistent with NI‐43‐101
reporting requirements and estimated in accordance with the Canadian
Institute of Mining, Metallurgy and Petroleum definitions. The Project is
located within the world-class Timmins-Porcupine Gold Camp and is 2 kilometres
southwest of the Bradshaw Gold Project of Gowest Gold Ltd., where work is
underway to restart mine operations.

 

The Tully Property covers 458 hectares in area, northeast of Timmins,
Ontario within an established mine camp with excellent
infrastructure. The Timmins-Porcupine Gold Camp, including the major Dome
and Hollinger mines, is one of the most productive gold fields in the world
primarily from high grade multiple vein systems, with more than 70 Moz of gold
produced to date.

 

Prospective structures splay off the Porcupine-Destor Fault through the Tully
area. Mineralisation at Tully occurs within a 30m wide mafic volcanic unit
with an approximate west-southwest strike and steep northerly dip. The hanging
wall consists of sedimentary rocks and the footwall consists of ultramafic
rocks. As currently understood, the deposit comprises an array of shallowly
inclined quartz-carbonate veins or lenses stacked 'ladder-style' within the
mafic host unit and constrained by its hanging wall and footwall contacts. The
higher-grade core of the deposit extends over 600m along strike and 400m down
dip, and plunges moderately toward the east-northeast. The mineralised
veins/lenses host gold primarily within irregular pyrite clusters and also
commonly as free visible gold, with assays running as high as 2,555.5 g/t Au.
Lower order gold values also occur within the host tuff unit outside of the
vein systems included in the resource estimate, sometimes over considerable
widths.

 

The Tully property occurs within a swampy area and is covered by blanket of
glacial drift, averaging 30m thickness which hid the deposit from early
explorers; thus, the geology is entirely derived from drillhole and
geophysical data. Exploration by a number of companies over several decades
has resulted in the drilling of many holes - the resource estimate utilised
data from an extensive database of 356 holes totalling 91,623 m, with 718
vein intercepts being interpreted and incorporated into the lens
wireframes.

 

The 2013 resource estimate of 107,000 ounces Au by Francis Minerals
Ltd combined in the Indicated and Inferred categories (uncapped 144,000
ounces Au) range in grade from 5.17g/t to 6.56g/t Au which is considered as
potentially economic grade for underground mining. While test work is
required to establish the optimum gold recovery process route from ore the
occurrence of a significant amount of coarse gold suggests that some of the
mineral could be amenable to simple gravity separation.

 

Fulcrum acquired the Project in August 2023, details of which were set out in
the announcement released by the Company on 7 August 2023.

 

During the year ended 31 December 2023, the Group expended approximately
£36,000 on the Project. The carrying value of the Project as at 30 June 2024
was £545,819 (as set out in the unaudited interim results released by Fulcrum
on 23 September 2024).

 

Technical Glossary

 Au                   Gold
 g/t                  grams per metric tonne
 NI 43-101 compliant  National Instrument 43-101 Standards of Disclosure for Mineral Projects is a
                      securities regulatory instrument that governs how companies can disclose
                      mining-related information in Canada.

 

 

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.

 

For further information please visit https://fulcrummetals.com/
(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 / Daniel Dearden-Williams       Tel: +44 (0) 203 328 5656

 Clear Capital Markets Limited (Broker)
 Bob Roberts                                  Tel: +44 (0) 203 869 6081

 St Brides Partners Ltd (Financial PR)
 Ana Ribeiro / Paul Dulieu                    Tel: +44 (0) 20 7236 1177

 

Notes to Editors

 

About Fulcrum Metals PLC

 

Fulcrum Metals PLC (AIM: FMET) is an AIM listed technology led natural
resources company focused on recovery of precious metals from mine tailings
(previously milled and processed ore) in Canada using environmentally friendly
leaching technology developed by Extrakt Process Solutions LLC and its
associates (together "Extrakt").  The Company's initial projects are at the
former Teck-Hughes and Sylvanite mines, located at the Kirkland Lake region in
Ontario. In addition, the Company has interests in a portfolio of highly
prospective mineral exploration and development projects in both Ontario and
Saskatchewan Canada.

 

Fulcrum is in advanced discussions with Extrakt to acquire exclusive licenced
use of their proven leaching technology on gold mine waste sites over the
mining districts of Timmins and Kirkland Lake. These are two of Canada's
biggest gold camps with a history of over 110Moz Au produced over the past 100
years and more than 70 documented legacy mine waste sites. This presents
Fulcrum with opportunity to develop into a significant environmentally
friendly gold producing entity in the near term.

 

About Loyalist Exploration Limited

 

Loyalist Exploration Limited is a mineral exploration company concentrating on
acquiring, exploring, and developing quality mineral properties in Canada. The
Company is focused on the Loveland nickel/copper/gold property and the
recently announced Gold Rush gold/silver property, both located in the
Timmins, Ontario mining district.

 

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