REG - Guardian Metal Rsrc. - LOI re Strategic Nevada Tungsten Project

Guardian Metal ResourcesAnnouncement

31/10/2024 07:00

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RNS Number : 3281K  Guardian Metal Resources PLC  31 October 2024

31 October 2024

Guardian Metal Resources plc

('Guardian Metal' or the 'Company')

Letter of Intent re Option to Acquire Strategic Nevada Tungsten Mine and Mill
Project

Guardian Metal Resources plc (LON:GMET, OTCQX:GMTLF), a strategic development
and mineral exploration company focused in Nevada, USA, is pleased to announce
that it has entered into a binding letter of intent ("LOI" or the "Agreement")
with Hinkinite Resources LLC ("Hinkinite" or the "Optionor") to acquire an
option ("Option") for the acquisition of the Tempiute Tungsten Mine & Mill
("Tempiute" or the "Project"). Tempiute, also formerly known as the Emerson
Tungsten or Black Dog Mine, is located in south-central Nevada less than 240
km north of Las Vegas. The acquisition of the Option is subject the
satisfactory completion of due diligence by Guardian on the Project within 90
days of the signing of the LOI.

Hinkinite is a privately owned and operated Utah-based company focused on the
prospecting and development of precious, base-metal and industrial material
deposits as well as on revitalising historic mining operations located
throughout the western United States. These holdings are diversified into a
variety of different commodities including tungsten, gold, silver, limestone,
gypsum, talc, silica, tar sands, and construction aggregates.

Oliver Friesen, CEO of Guardian Metal, commented:

"In the three years since the Company acquired the Pilot Mountain project, the
Guardian team has spent countless hours building its knowledge in the tungsten
sector, and forging key relationships across both the U.S. and globally.
Through this, we have come to the conclusion that the macro setup for this key
defence metal warrants our investment decision to gain more exposure to this
critical commodity.

"Tempiute, being a significant tungsten producer as recently as the late
1980s, along with the extensive in-place infrastructure and its location
almost entirely within patented, wholly owned claims, makes it an extremely
attractive Project. While on my recent site visit I was able to tour Tempiute
with the Optionor and was very impressed by what the Project offers.

"If due diligence is satisfactory and we proceed with the Option, Tempiute,
which is located only 290 km by road from our flagship Pilot Mountain project,
would add a further significant tungsten project to the Guardian Metal
portfolio. We look forward to providing the market with further updates as the
due diligence work concludes."

About Tempiute:

 

§   Tempiute is located in south-central Nevada, 237 km north of Las Vegas
and only 290 km by road from Pilot Mountain.

 

§   Formerly the Emerson Mine, the Project has been explored and mined for
tungsten, silver and zinc intermittently over the last century, most recently
being in operation by United Carbide from 1977 to 1987, ceasing operations due
to a crash in tungsten prices following market flooding by Chinese producers.

 

§   The majority of the known mineralisation at the Project is located
within 10 patented claims which provide exclusive ownership of the land,
minerals, and all resources. The Project also comprises six unpatented Bureau
of Land Management ("BLM") millsite claims, four BLM lode claims and two BLM
placer claims.

 

§    The two placer claims cover the historic tailings located less than
1.5km from the Project. The tailings measure approximately 300m x 300m and are
believed to be circa 10-15m thick. Considering the metals that were extracted
during the previous production period, it is believed that multiple
recoverable metals may still exist within the tailings which could allow for
near term reprocessing if sampling results prove promising.

 

§     Six high-grade stockpiles exist within the Project which were not
processed in the 1980s due to the lack of technology available to efficiently
process sulphide rich material. Today, the technology is well advanced to
efficiently process this type of material.

 

§   Multiple historical resource estimates have been reported on the
Project. Currently the documentation pertaining to these estimates has not
been located by the Company, however, an internal report by a previous owner
outlined a combined Measured, Indicated and Inferred estimate of 8,000,000
tons grading 0.43% W0(3). Further work will be required to confirm these
estimates but the bonus payment outlined in the Agreement is based on the
above estimate.

 

§   The Company's CEO visited the Project with the Optionor during a recent
site visit to Nevada and took a total of 17 due diligence samples from various
high-grade stockpiles and exposed surface showings as well as from the
tailings. These samples are now with ALS Laboratory in Reno, Nevada, for rush
analysis.

 

Commercial Terms:

 

§    Within three (3) business days of execution of the Agreement,
Guardian Metal will pay to the Optionor a deposit of US$5,000 (the
"Deposit").

 

§    For a period of ninety (90) calendar days following the date of the
Agreement, Guardian Metal may conduct due diligence investigations in respect
of the Project (the "Due Diligence Review"). If, at any time, Guardian Metal
determines that it is not satisfied, in its sole discretion, with the results
of such investigations, it may elect to terminate the Agreement.

 

§   Assuming the Company is satisfied with the findings of the Due
Diligence Review, Guardian Metal may proceed with the execution of the
definitive agreement (the "Definitive" or "Definitive Agreement") to acquire
the Option.  At this point a cash payment of US$50,000 will be made to the
Optionor along with the issue to the Optionor of 150,000 Guardian Shares.

 

§   Following execution of the Definitive Agreement and until such time as
the Option is exercised or the Definitive Agreement is terminated, Guardian
Metal will pay the Optionor a cash payment of US$25,000 at the end of each six
month period following the date of the Definitive Agreement.

 

§    In order to exercise the Option, Guardian Metal will be required, (i)
within three (3) years of the date of the Definitive Agreement, to establish
on the Property a "mineral resource" of tungsten trioxide (WO(3)) with a
minimum cut off grade of 0.4%, prepared in accordance with either the CIM
Definition Standards on Mineral Resources and Mineral Reserves adopted by CIM
Council, as amended, or the Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves (the "Maiden Resource"), and (ii)
within five (5) business days of the announcement of the Maiden Resource to
pay the Optionor a bonus of US$100,000 for each 3,100 tons WO(3) of such
Maiden Resource (the "Bonus Payment"), equal to US$1,000,000 for a 31,000 ton
WO(3) Maiden Resource, up to a maximum Bonus Payment of US$2,000,000. Guardian
Metal may, in its sole discretion, satisfy up to 50% of the Bonus Payment by
issuing to the Optionor Guardian Shares at a deemed price per share equal to
the volume weighted average trading price of the Guardian Shares on the London
Stock Exchange for the last ten (10) trading days ("10-day VWAP") calculated
as of the date of the announcement of the Maiden Resource, converted from
pounds sterling to United States dollars using the Bank of England daily spot
exchange rate as of the date of the announcement.  In the event that Guardian
Metal does not establish a Maiden Resource and make the Bonus Payment within
three (3) years of the date of the Definitive Agreement, the Definitive
Agreement will terminate and Optionor will retain a 100% interest in the
Property.

 

§    Upon Guardian Metal having established a Maiden Resource and payment
of the Bonus Payment, Guardian Metal will be deemed to have acquired a 100%
interest in the Project.

 

§    Upon exercise of the Option, Guardian Metal will grant the Optionor a
production royalty equal to 1.5% of the net smelter returns from all mineral
production from the Project (the "NSR Royalty"). Guardian Metal may, at any
time after the grant of the NSR Royalty, repurchase 50% of the NSR Royalty for
a one time payment of US$1,000,000 by Guardian Metal to Optionor, payable at
the option of Guardian Metal in cash or in Guardian Shares at a deemed price
per share equal to the 10-Day VWAP converted from pounds sterling to United
States dollars using the Bank of England daily spot exchange rate calculated
as of the date that Guardian Metal provides notice to the Optionor of its
election to repurchase. The balance of the NSR Royalty after repurchase will
be 0.75% of the net smelter returns from all mineral production on the
Project.

 

§   Whilst there is no guarantee of completion, the Company and the
Optionor will work together to complete all required due diligence items
within the 90 day period which will allow Guardian Metal to make a decision
regarding signing of the Definitive Agreement.

 

Media

Figure 1: Nevada location map showing position of the Company's 100% owned
Pilot Mountain Project and Tempiute.

 

Figure 2: View over the Project's Millsite claims showing the location of the
mill (centre), maintenance shack (left), and office/bathhouse, 3000KW
substation and water tank (right).

 

Figure 3: One of the Project's (six) high-grade sulphide rich stockpiles.

 

References

1:            Golden Predator Mines Inc. Internal Document dated 22
May 2008.

 

 

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014 (which forms part of domestic UK law pursuant to the
European Union (Withdrawal) Act 2018).

 

 

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and
approved by Mr Nick O'Reilly (MSc, DIC, MIMMM QMR, MAusIMM, FGS), who is a
qualified geologist and acts as the Competent Person under the AIM Rules -
Note for Mining and Oil & Gas Companies. Mr O'Reilly is a Principal
consultant working for Mining Analyst Consulting Ltd which has been retained
by Guardian Metal Resources plc to provide technical support.

Forward Looking Statements

This announcement contains forward-looking statements relating to expected or
anticipated future events and anticipated results that are forward-looking in
nature and, as a result, are subject to certain risks and uncertainties, such
as general economic, market and business conditions, competition for qualified
staff, the regulatory process and actions, technical issues, new legislation,
uncertainties resulting from potential delays or changes in plans,
uncertainties resulting from working in a new political jurisdiction,
uncertainties regarding the results of exploration, uncertainties regarding
the timing and granting of prospecting rights, uncertainties regarding the
timing and granting of regulatory and other third party consents and
approvals, uncertainties regarding the Company's or any third party's ability
to execute and implement future plans, and the occurrence of unexpected
events.

Actual results achieved may vary from the information provided herein as a
result of numerous known and unknown risks and uncertainties and other
factors.

For further information visit www.Guardianmetalresources.com
(http://www.goldenmetalresources.com) or contact the following:

 Guardian Metal Resources plc                 Tel: +44 (0) 20 7583 8304

 Oliver Friesen (CEO)
 Cairn Financial Advisers LLP                 Tel: +44 20 7213 0880

 Nominated Adviser

 Sandy Jamieson/Jo Turner/Louise O'Driscoll
 Shard Capital Partners LLP                   Tel: +44 (0) 20 7186 9000

 Lead Broker

 Damon Heath/Erik Woolgar

 

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