Electric Royalties Ltd. (TSX-V: ELEC) is pleased to announce the signing of two royalty purchase and sale agreements to acquire, in the aggregate, a 1% Net Smelter Royalty (the “1% NSR”) on licenses comprising core strategic tenure at the Cancet Lithium Project situated in Quebec, Canada, such transactions being with arm’s-length parties.
“We are pleased to add the Cancet lithium royalty to our portfolio of high-impact hardrock lithium royalties on projects securely located in Eastern Canada. MetalsTech Limited, the Australian-listed developer of the Cancet Project, has had significant corporate success advancing the asset including a recent royalty financing with the privately-held Lithium Royalty Corp., and a recent announcement to spin out their portfolio of lithium assets (which includes the Cancet Project) into a new company, Winsome Resources Limited. MetalsTech has also appointed Canaccord Genuity (Australia) as lead manager for up to an A$18 million financing as relates to the proposed spin-out transaction of their lithium assets.
The Cancet Project is favourably located in the heart of Plan Nord, an area in which the Quebec government is fostering resource development, including the next generation of battery metal deposits. Cancet is located adjacent to the Taiga Highway and would have access to abundant hydropower which could provide clean power for any eventual mining operation. Initial work suggests that the mineralization at Cancet compares very favorably with other deposits in the region. At Electric Royalties, we expect the project to advance toward a resource with additional drilling over the next several years.
In addition, the contribution of the Cancet lithium royalty under an all-share basis to our portfolio reflects the growing strategic value of our listed-equity and demonstrates our capacity to build Electric Royalties into North America’s premier battery metals royalty company with ongoing transactional velocity,” noted Brendan Yurik CEO of Electric Royalties.
Electric Royalties is acquiring the 1% NSR on the Cancet Project for a total consideration of 3,000,000 common shares (“Acquisition Consideration”) of the Company. The Acquisition Consideration will be subject to a voluntary escrow lock-up agreement, which provides that 50% of the common shares will be subject to a hold period of 4 months, 25% for 8 months and the remaining 25% for 12 months.
The transactions noted herein are subject to completion of due diligence, approval of the TSX Venture Exchange and other customary conditions.
Cancet Lithium Project Overview
The Cancet Project is an exploration stage project 100% owned by MetalsTech Limited (ASX: MTC). The project is located in northern Quebec approximately 250 km east of James Bay, in the administrative region known as Nord-du-Québec. The broader project covers approximately 12,746 hectares, is beneficially located on an all-season highway and is in close proximity to low-cost hydroelectric power.
In 2017, a two-phase drill program totaling 5,216 metres in 59 holes was completed on the property. Spodumene-bearing pegmatite was traced continuously along strike for approximately 1.1 km. The mineralization, as well as host pegmatite, is interpreted to be shallow dipping; however, drill testing of the down dip continuity is limited. The discovery of additional pegmatite outcrop and a spodumene-bearing boulder attests to the on-strike exploration potential at Cancet.
David Gaunt, P.Geo., a Qualified Person who is not independent of Electric Royalties, has reviewed and approved the technical information in this release.
About Electric Royalties Ltd.
Electric Royalties is a royalty company established to take advantage of the demand for a wide range of commodities including lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc, copper and iron that will benefit from the drive toward electrification of a variety of consumer products: cars, rechargeable batteries, large scale energy storage, renewable energy generation and other applications.
Electric vehicle sales, battery production capacity and renewable energy generation are slated to increase significantly over the next several years and with it, the demand for these targeted commodities. This creates a unique opportunity to invest in and acquire royalties over the mines and projects that will supply the materials needed to feed the electric revolution.
Electric Royalties has a growing portfolio of 16 royalties and is focused predominantly on acquiring royalties on advanced stage and operating projects to build a diversified portfolio located in jurisdictions with low geopolitical risk.
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We acknowledge the [financial] support of the Government of Canada.