REG - Fulcrum Metals PLC - Signs LOI for the sale of its uranium assets

Fulcrum MetalsAnnouncement

03/04/2024 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240403:nRSC0598Ja&default-theme=true

RNS Number : 0598J  Fulcrum Metals PLC  03 April 2024

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

 

 

3 April 2024

 

 

Fulcrum Metals plc

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

 

Announces Letter of Intent with Terra Balcanica Resources Corp. for the sale
of Fulcrum's

Saskatchewan uranium projects

 

Fulcrum Metals plc (LON: FMET), a company focused on mineral exploration and
development in Canada, is pleased to announce that it has entered into a
non-binding Letter of Intent ("LOI") with Terra Balcanica Resources Corp.
(CNSX: TERA) ("Terra" or the "Optionee"), a mining explorer with projects in
Bosnia and Herzegovina and Serbia.  Pursuant to the LOI, Terra, through an
Option Agreement (the "Option Agreement"), will be granted the option to
acquire a 100% interest in Fulcrum's uranium projects (the "Uranium Projects")
located in Saskatchewan, Canada.

 

Terra will have the option to acquire the Uranium Projects, consisting of the
Charlot-Neely, Fontaine Lake, Snowbird and South Pendleton projects by
completing four years of exploration programmes and making a series of cash
and equity payments as outlined below:

 

 

                                                                           Cash to Fulcrum                                Value of Shares in Terra to Fulcrum  Exploration Expenditures required by Terra

 Payment to Fulcrum for exclusivity on execution of signing the letter of  CA$7,500
 intent
 Payment to Fulcrum on closing of Option Agreement                         CA$25,000 less CA$7,500 exclusivity agreement  CA$250,000

                                                                                                                                                               Complete minimum work expenditures totalling CA$3,250,000

                                                                                                                                                               Prior to fourth anniversary of the Option Agreement
 Year 1                                                                    CA$50,000                                      CA$350,000
 Year 2                                                                    CA$75,000                                      CA$500,000
 Year 3                                                                    CA$75,000                                      CA$650,000
 Year 4                                                                    CA$75,000                                      CA$1,250,000
 Total                                                                     CA$300,000                                     CA$3,000,000                         CA$3,250,000

 

The new shares in Terra that could be issued to Fulcrum under the terms of the
Option Agreement will be issued at the 10-day Volume Weighted Average Price
("VWAP") prior to the date of issuance. The shares issued to Fulcrum on
closing of the Option Agreement will be capped at CA$0.065 per share,
pre-consolidation by Terra. Cash generated from the sale of the Uranium
projects will be used by Fulcrum for its ongoing capital needs.

 

In addition, and following the exercise of the option, Fulcrum will retain a 1
per cent. Net Smelter Return ("NSR") royalty on all claims with a buydown
option of 0.5 percent NSR for CA$1 million. As part of the Option Agreement,
and for terminating the existing agreement (the "Prior Agreement") between
Fulcrum and Global Energy Metals Corp. ("Global Energy"), details of which
were announced by Fulcrum on 30 January 2024, Global Energy will be
compensated with CA$150,000 to be satisfied through the issue of new shares in
Terra on the closing of the Option Agreement and a 0.5 per cent. NSR on all
claims.

 

Completion of the transaction outlined in the LOI is conditional on the
completion of due diligence, Board approval by Fulcrum and Terra, receipt of
all required third party consents and execution of the Definitive Option
Agreement. The Company anticipates the completion of the definitive agreement
to take place by 1(st) May 2024.

 

The LOI is non-binding and sets out the intention of both parties to enter
into a definitive agreement on the terms set out in the LOI, the key terms of
which are summarised in this announcement. There can be no guarantee that a
definitive agreement in relation to the Option Agreement will be entered into
nor that the terms will be the same as set out in the LOI and this
announcement.

 

Addition terms of the LOI

 

 Orderly Sales Agreement  Fulcrum will agree to orderly sales provisions with respect to its equity
                          interest in Terra
 Dunn Option*             The Option Agreement will include a covenant by Fulcrum to maintain the Dunn
                          Option in good standing, and to exercise the Dunn Option and acquire a 100%
                          interest in the properties included in the Uranium Projects that are subject
                          to the Dunn Option.
 Governing Law            The Option Agreement shall be governed by and construed in accordance with the
                          laws of the Province of British Columbia, and the federal laws of Canada.

* Certain claims comprising properties that are owned by Gary Clayton Dunn and
Jonathan Stewart Dunn who granted an option to acquire a 100% interest in them
to Fulcrum pursuant to a mining option agreement

 

 

Ryan Mee, Chief Executive Office of Fulcrum, commented:

 

"We have experienced significant interest from third parties over our uranium
assets in Saskatchewan and are pleased to be able to announce the signing of
this non-binding LOI with such a strong operational partner in Terra to apply
their technical expertise to advance these Uranium projects. The completion of
the option agreement will facilitate four years of exploration on these highly
prospective licence areas, at a time when uranium prices, driven by the energy
transition, continue to rise.

 

The terms outlined in the LOI, and consequent Option Agreement will enable
Fulcrum shareholders to benefit from the potential upside of these projects,
via the net smelter royalty and Terra shares, whilst providing Fulcrum with an
injection of cash which we can use to advance other projects."

 

"At Fulcrum we are fortunate to have an outstanding team and this agreement
not only endorses the strategy deployed by Fulcrum but is an important step
for Fulcrum to execute the next stage of the strategy with a clear focus on
gold, and in particular more so on gold tailings and mine waste in Ontario.

 

The gold tailings and mine waste in Ontario combines established mining
jurisdiction with low discovery risk, and potential for earlier cash-flow
opportunities. Teck-Hughes is Fulcrum's first gold tailings project, located
in Kirkland Lake, Ontario for which sampling was complete in January and
testing is underway at Extrakt Process Solutions testing facility. In addition
to this the company is working on a framework with Extrakt Process Solutions
and their alliance partners including Bechtel Corporation on licensing
opportunities in Ontario.

 

Fulcrum has significant opportunities opening up, and I look forward to
updating the market at the appropriate time as we progress these".

 

 Additional project information

The project portfolio totals over 59k hectares targeting major structures
along strike from historic Uranium mines and projects that have attracted
significant investment. Discoveries such as the Arrow discovery (4.3m tonnes
at 0.83% U308) and Triple R discovery (2.7m tonnes at 1.94% U308) have proved
the concept of exploring along structure outside of the Athabasca basin.

Highlights

·   Proximal to northern and southeastern edges of the Athabasca Basin
("Basin") in northern Saskatchewan, a premium mining district and leading
global source of high-grade uranium;

 

·   Charlot-Neely is located within the emerging Uranium City district on
the northwestern margin of the Basin

 

·   Historical work at the projects has demonstrated evidence of uranium
mineralization along favourable structural trends with prospective target
horizons based on electromagnetic conductors;

 

·   Future exploration by Terra will see the undertaking of a modern
systematic geologic fieldwork to determine the resource potential.

 

 

Background of Terra

 

Terra is a public company listed on the Canadian Securities Exchange. Terra
has mining exploration projects in Bosnia & Herzegovina and Serbia. The
Terra management team has a track record in the mineral exploration,
development and mining industries as well as Canadian capital markets.

For the year ended 31 January 2023, Terra incurred a loss for the year before
tax of $CAD2,013,644 with net assets of $CAD2,291,508.

Technical Glossary

 "cps"       Counts per second
 "EM"        Electromagnetic
 "ppm"       Parts per million
 "REE"       Rare-earth element
 "TREE"      Total Rare earth elements are a group of 17 elements composed of scandium,
             yttrium and the lanthanides
 "U(3)0(8)"  Triuranium octoxide, a compound of uranium

 

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 / George Payne                  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

 

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.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  LOIQKBBNCBKDNQK