
Osisko Metals Incorporated (TSX-V: OM) (OTCQX: OMZNF) (FRANKFURT: 0B51) is pleased to announce that, further to its news release dated July 11, 2022 (entitled “Osisko Metals Exercises Option to Acquire Gaspé Copper Project”), it has completed the acquisition of a 100% interest in the past-producing Gaspé Copper Mine pursuant to a purchase agreement dated July 8, 2022 between the Company and Glencore Canada Corporation, a wholly-owned subsidiary of Glencore plc.
Robert Wares, Chairman & CEO of Osisko Metals, commented: “The acquisition of the Gaspé Copper Project is a milestone for the Company that provides shareholders with significant copper exposure in the mining-friendly province of Québec. Last year’s excellent drill results at Gaspé support our belief in the high-value potential of this asset and we are convinced that the acquisition of Gaspé Copper, together with our ongoing development of our joint-ventured Pine-Point project, positions Osisko Metals as a premier base metal development company in Canada. I wish to thank both the Osisko Metals and Glencore teams, as well as all stakeholders, for their diligence and perseverance in completing this complex transaction that will no doubt benefit all parties and shareholders.”
In connection with the Transaction:
Upon conversion of the Convertible Note by Glencore, Glencore may hold, on a post-conversion basis, such number of Common Shares and Warrants that would exceed 20% of the pro forma issued and outstanding Common Shares, both on a non-diluted and partially-diluted, post-conversion basis, thus resulting in Glencore becoming a Control Person (as such term is defined in the policies of the TSX Venture Exchange) of the Company. Accordingly, in accordance with the policies of the Exchange, the disinterested shareholders of the Company were required to approve Glencore as a Control Person of the Company, which approval was obtained at a meeting of shareholders held on June 23, 2022. For more information, please refer to the management information circular of the Company dated May 11, 2022, a copy of which is available on SEDAR (www.sedar.com) under the Company’s issuer profile.
In accordance with the terms of the Investor Rights Agreement, Mr. Peter Wright will be appointed to the board of the Company. Mr. Wright has served as Director and Vice President, Legal, with Glencore since 2018, having joined the company in 2014. Previously, Mr. Wright practiced corporate law in Toronto with Torys LLP and Cassels, Brock & Blackwell LLP as well as in New York with Paul, Weiss, Rifkind, Wharton & Garrison LLP. Mr. Wright graduated from the McGill Faculty of Law with Great Distinction in 2004 (BCL/LLB) and has since been called to the bars of Ontario (2005) and New York (2006).
About Gaspé Copper
Gaspé Copper, a 44-year former copper and molybdenum producer that was initially operated by Noranda Inc., is located next to the community of Murdochville, in the Gaspé Peninsula of Eastern Quebec, approximately 825km east of Montreal. Most support infrastructure for the potential re-opening of Gaspé Copper is already in place. The former mine site benefits from paved road access with local highway 198 linking Murdochville with the coastal community of Gaspé.
As of the date hereof, the Company has completed approximately 28,000 meters of drilling at Gaspé Copper in accordance with the recommended work program outlined in the Technical Report (as defined below). Between 6,000 meters and 10,000 meters in additional drilling is expected to be completed by the Company during the 2023-2024 drill program. A reconciliation of the proposed work program against the work program recommended in the Technical Report is provided in the table below.
Recommended 2021 Work Program for the Gaspe Copper Deposit | Technical Report | Incurred on project as at June 30, 2023(4) | Remaining work as at June 30, 2023 |
Drilling 30,000m ($350 m all inclusive)(1) | $10,500,000 | $10,600,000(2) | $3,000,000(3) |
Metallurgical Testing and Analysis | $75,000 | $75,000 | Nil |
TOTAL | $10,575,000 | $10,675,000 | $3,000,000 |
Note:
For more detailed information about Gaspé Copper, please refer to the technical report entitled “Gaspé Copper Project, Mineral Resource Estimate, Mount Copper Deposit, Québec, Canada” dated June 12, 2022 (with an effective date of April 12, 2022), which has been prepared for Osisko Metals by representatives of SGS Canada Inc., a copy of which is available on SEDAR (www.sedar.com) under Osisko Metals’ issuer profile (the “Technical Report“).
Advisors
Bennett Jones LLP acted as legal counsel to Osisko Metals in connection with the Transaction.
About Glencore and its Holdings in the Company
Glencore is one of the world’s largest global diversified natural resource companies and a major producer and marketer of more than 60 commodities that advance everyday life. Through a network of assets, customers and suppliers that spans the globe, Glencore produces, processes, recycles, sources, markets and distributes the commodities that support decarbonization while meeting the energy needs of today. With around 140,000 employees and contractors and a strong footprint in over 35 countries in both established and emerging regions for natural resources, Glencore’s marketing and industrial activities are supported by a global network of more than 40 offices.
Glencore’s customers are industrial consumers, such as those in the automotive, steel, power generation, battery manufacturing and oil sectors. Glencore also provides financing, logistics and other services to producers and consumers of commodities.
Glencore is proud to be a member of the Voluntary Principles on Security and Human Rights and the International Council on Mining and Metals. Glencore is an active participant in the Extractive Industries Transparency Initiative and is working to decarbonize its operational footprint.
Certain information in this news release is provided by Glencore in satisfaction of the early warning requirements of National Instrument 62-104 – Take-Over Bids and Issuer Bids. Glencore acquired the Convertible Note for investment purposes and may elect to convert the Convertible Note, in whole or in part, into Units in accordance with its terms and to exercise some or all of the Warrants issued upon conversion. Glencore will continue to monitor the business, prospects, financial condition and potential capital requirements of the Company. Depending on its evaluation of these and other factors, Glencore may from time to time in the future decrease or increase its direct or indirect ownership, control or direction over securities of the Company through market transactions, private agreements, subscriptions from treasury or otherwise or may in the future develop plans or intentions relating to any of the other actions listed in (a) through (j) of Item 5 of Form 62-103F1 – Required Disclosure Under the Early Warning Requirements.
For the purposes of this news release and early warning disclosure, the pro-forma number and percentage of outstanding Common Shares owned and controlled by Glencore following completion of the Transaction is based on 256,574,935 outstanding Common Shares following the completion of the Transaction.
About Osisko Metals
Osisko Metals Incorporated is a Canadian exploration and development company creating value in the critical metals space, specifically copper and zinc. The Company is a joint venture partner with Appian Natural Resources Fund III LP for the advancement of one of Canada’s premier past-producing zinc mining camps, the Pine Point project, located in the Northwest Territories, for which the 2022 PEA (as defined herein) has indicated an after-tax NPV of C$602 million and an IRR of 25%, based on long-term zinc price of US$1.37/lb and the current mineral resource estimates that are amenable to open pit and shallow underground mining. The current mineral resource estimate in the 2022 PEA consists of 15.7Mt grading 5.55% ZnEq of indicated mineral resources and 47.2Mt grading 5.94% ZnEq of inferred mineral resources. Please refer to the technical report entitled “Preliminary Economic Assessment, Pine Point Project, Hay River, Northwest Territories, Canada” dated August 26, 2022 (with an effective date of July 30, 2022), which has been prepared for Osisko Metals an PPML by representatives of BBA Engineering Inc., Hydro-Resources Inc., PLR Resources Inc. and WSP Canada Inc. Please refer to the full text of the 2022 PEA, a copy of which is available on SEDAR (www.sedar.com) under Osisko Metals’ issuer profile, for the assumptions, methodologies, qualifications and limitations described therein. The Pine Point Project is located on the south shore of Great Slave Lake in the Northwest Territories, near infrastructure, paved highway access, and has an electrical substation as well as 100 kilometres of viable haulage roads already in place.
As described above, the Company has acquired a 100% interest in the past-producing Gaspé Copper Mine, located near Murdochville in the Gaspé peninsula of Québec. The Company is currently focused on resource evaluation of the Mount Copper Expansion Project that hosts an inferred mineral resource (in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects) of 456Mt grading 0.31% Cu (see April 28, 2022 news release of Osisko Metals entitled “Osisko Metals Announces Maiden Resource at Gaspé Copper – Inferred Resource of 456Mt Grading 0.31% Copper”). Gaspé Copper hosts the largest undeveloped copper resource in Eastern North America, strategically located near existing infrastructure in the mining-friendly province of Québec.
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