Electric Royalties to Acquire 1.5% NSR on Canadian Lithium Deposit
VANCOUVER, BC, Feb. 17, 2021 /CNW/ – Electric Royalties Ltd. (TSXV: ELEC) (“Electric Royalties” or the “Company”) is pleased to announce the signing of a Purchase and Sale Agreement to acquire a 1.5% Net Smelter Royalty (“NSR“) interest from an arm’s-length party on the Seymour Lake Lithium Deposit, located near significant infrastructure in Ontario, Canada.
Brendan Yurik, CEO of Electric Royalties, stated “We are excited to acquire another royalty on an advanced hard rock lithium project in central Canada where a new lithium hub is beginning to emerge. In Seymour Lake, we see a project with similar potential to the Authier project in Quebec, operated by Sayona Mining, on which the Company holds a royalty. Separately, I am pleased to welcome Ryan Kalt to our advisory team. He has significant experience in mining royalties and previously led the successful sale of Gold Royalties Corp. to Sandstorm Gold in 2015.”
Seymour Lake Lithium Deposit
The Seymour Lake lithium-tantalum deposit is operated by ASX-listed Ardiden Limited (ASX:ADV) and is located within the Caribou Lake Greenstone Belt approximately 45 km northeast of Armstrong in northwestern Ontario. The property covers 16,654 ha and contains lithium mineralization hosted in spodumene-bearing pegmatite sills with thicknesses of more than 26 metres. These near surface pegmatite sills have been defined over a 5 km strike length and comprise multiple prospective targets including North Aubry, Central Aubry, South Aubry and Pye. The main pegmatite at the North Aubry prospect is 250 metres wide and 300 metres long and remains open along strike and at depth.
The proximity of the pegmatites to surface at the North Aubry prospect is considered to be a strategic advantage, potentially allowing easier access to high-quality mineralization in a future mining scenario, reducing the required pre-strip and resulting in a lower extraction cost and improved project economics. Depending on future exploration and drilling results, the mineralization at North Aubry may be amenable to extraction via a series of high-grade, low-strip open pits.
The Seymour Lake lithium deposit has excellent road access. It is also beneficially located within 9 kilometres of Ferland Station, which is located on the main CN rail line, thus allowing access to the US market via Thunder Bay and Lake Superior in any potential future mining scenario.
In 2019, Ardiden Limited signed a non-binding Memorandum of Understanding (MOU) with nearby lithium developer, Rock Tech Lithium Inc (TSX-V: RCK) to investigate the joint development of the Seymour Lake lithium deposit and Rock Tech’s Georgia Lake Lithium project.
In 2020, Rock Tech completed an updated Preliminary Economic Assessment (“PEA”) on the Georgia Lake lithium deposit, which involved construction of a Lithium Hydroxide manufacturing plant near Thunder Bay, Ontario. The 24,000 tonnes per annum (“tpa”) case presented in the PEA would require Rock Tech to supplement the available material from Georgia Lake with material from other lithium deposits. This 24,000 tpa case had a post-tax net present value of US$ 875 million and an internal rate of return of 27.7%1. This information is based on technical work programs reported in a PEA study that is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty that the projections will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
The Company is acquiring the 1.5% NSR (the “NSR Interest“), being one-half of an aggregate 3.0% NSR (the “Project NSR“), directly from an arm’s-length holder (the “Royalty Investor“) who acquired the NSR Interest in 2011, with the balance of the Project NSR held by Sandstorm Gold Ltd.
Subject to certain customary conditions and TSX-V approval, Electric Royalties shall acquire the NSR Interest by issuing a total of 3,000,000 common shares of Electric Royalties to the Royalty Investor.
1 Based on long term price of US$850/t Li2O. The persons responsible for the Georgia Lake mineral resource estimate are Ryan James Hanrahan, BEng, GAICD, MIEAust, CPEng, NPER, IntPE, and Chris Larder, FAusIMM, qualified persons as defined under 43-101. The technical report is Preliminary Economic Assessment for an Integrated Lithium Hydroxide Operation from the Georgia Lake Lithium Project, Northwest Ontario, Canada; October 30, 2020 filed at www.sedar.com
Ryan Kalt Joins Advisory Team
The Company is also pleased to announce that Ryan Kalt has agreed to join the Company’s Advisory Team.
“I believe Electric Royalties represents a disruptive innovator within the royalty space and is well-positioned to become a leading next-generation metals royalty company. The company’s focus on battery and electric metals is one that I am confident presents tremendous go-forward opportunity for shareholders. Similar to some of today’s leading gold royalty businesses that evolved into multi-billion-dollar enterprises through more traditional-commodity royalty models, I believe Electric Royalties is at the cusp of building-out a uniquely positioned strategic royalty model in what may prove to be an even larger global market, electrification,” commented Ryan Kalt, Advisor to Electric Royalties.
Mr. Kalt is an experienced entrepreneur and businessperson who has founded and built a number of significant private and publicly-traded companies. He is presently the Chairman of Kalt Industries Ltd., a diversified investment company based in Calgary, Alberta.
Mr. Kalt also currently serves as the Chairman and Chief Executive Officer of Red Lake Gold Inc. and as Chairman and Chief Executive Officer of Dixie Gold Inc. and has served as a director for a variety of publicly traded companies. Mr. Kalt is also the Chairman and Chief Executive Officer of Alma Gold Inc., a private reporting issuer, and is an active member of the Law Society of Alberta.
He previously served as the Founder and Chief Executive Officer of Gold Royalties Corp., which was publicly traded until its acquisition by Sandstorm Gold Ltd. in 2015.
Mr. Kalt holds a B.Comm from Queen’s University, an LL.B. from the University of Western Ontario, an LL.M. in Natural Resources, Energy and Environment Law from the University of Calgary and a Master of Business Administration (MBA) from the Richard Ivey School of Business.
In connection with the foregoing, the Company has granted 200,000 options of the Company to Mr. Kalt.
David Gaunt, PGeo., 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 (lithium, vanadium, manganese, tin, graphite, cobalt, nickel & copper) 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 now has a portfolio of 12 royalties and plans to focus predominantly on acquiring royalties on advanced stage and operating projects to build a diversified portfolio located in jurisdictions with low geopolitical risk.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statements Regarding Forward-Looking Information and Other Company Information
This news release includes information regarding other companies based on previously disclosed pubic information disclosed by those companies and the Company is not responsibility for the accuracy of that information, and that all information provided herein is subject to this FLI cautionary. This news release also includes forward-looking information and forward-looking statements (collectively, “forward-looking information”) with respect to the Company and these other companies and within the meaning of Canadian securities laws. Forward looking information is typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. This information represents predictions and actual events or results may differ materially. Forward-looking information may relate to the Company’s future outlook and anticipated events or results or those of these other companies and may include statements regarding the Company’s financial results, future financial position, expected growth of cash flows, business strategy, budgets, projected costs, projected capital expenditures, taxes, plans, objectives, industry trends and growth opportunities or those of these other companies.
While management considers these assumptions to be reasonable, based on information available, they may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company or these other companies to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to risks associated with general economic conditions; adverse industry events; marketing costs; loss of markets; future legislative and regulatory developments involving the renewable energy industry; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the mining industry generally, the Covid-19 pandemic, recent market volatility, income tax and regulatory matters; the ability of the Company or any of these other companies to implement its business strategies including expansion plans; competition; currency and interest rate fluctuations, and the other risks.
The reader is referred to the Company’s most recent filings on SEDAR and those of these other companies, or equivalent public filings for a more complete discussion of all applicable risk factors and their potential effects, copies of which may be accessed through the Company’s profile page at www.sedar.com.
SOURCE Electric Royalties Ltd.
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