VANCOUVER, Oct. 19, 2021 /CNW/ - Electric Royalties Ltd. (TSXV: ELEC) (OTCQB: ELECF) ("Electric Royalties" or the "Company") is pleased to announce the signing of a letter of intent with Scandinavian Resource Holdings ("SRH") and Global Energy Metals Corp. (TSX-V: GEMC) to acquire a 1% net smelter revenue royalty (the "1% NSR") on four exploration licenses totaling 25 square kilometers in the Råna mafic-ultramafic intrusion in Northern Norway, including the past producing Bruvann Nickel mine (the "Rana Nickel Project" or "Rana").
Rana Nickel Royalty Acquisition Highlights
Includes the past producing Bruvann Ni-Cu-Co mine that shut down in 2002 due to low nickel prices, which has significant remaining historical resources.
Located adjacent to main north-south highway and in an area with a long history of mining and skilled manpower.
Available mine infrastructure includes power, roads, and conveyor from mine site to existing port facilities.
Large historical drill database of 3,845 holes which demonstrates compelling near mine exploration potential.
Underexplored property with demonstrated exploration potential.
Rana Nickel Project Overview
The Rana Nickel Project is located on the Ofoten Fjord in Northern Norway and is ice-free year-round. The project includes the past producing Bruvann Ni-Cu-Co mine which was in production from 1989 until 2002 and processed 8.2 million tonnes of ore at an average grade of 0.52% Ni, 0.1% Cu and 0.02% Co1.
A historical estimate of the remaining resource is 9.15 million tonnes at grades of 0.36% Ni, 0.09% Cu and 0.01% Co above a cut-off of 0.3% Ni1. The mineralization is reported to be open in several directions.
The estimate was obtained from a report prepared by the Norwegian Geological Survey ("NGU"). No classification of the estimate was reported. The estimate is historical in nature and does not qualify as mineral resources under CIM Definition standards and NI 43-101. A qualified person under has not done sufficient work to classify the estimates as current mineral resources and the Company is not treating them as current.
Bruvann is located 2 km away from a shipping dock with an existing conveyor connecting the mine site with dock facilities. Mine roads and power facilities as well as some of the mine buildings have been maintained and the main north-south highway in the region crosses the property.
1 The past production and historical estimate for the Rana Project is reported in Carl Olaf Mathiesen and Rognvald Boyd, 2017: History of exploration of the nickel resources of the Råna Intrusion, Nordland, Norway, NGU Report 2017.31, available at https://www.ngu.no/upload/Publikasjoner/Rapporter/2017/2017_031.pdf.
Electric Royalties is acquiring the 1% NSR on the Rana Nickel Project for a total consideration of 2,000,000 common shares of the Company ("Consideration Shares") and $100,000 cash. The Consideration Shares 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 and one day, 25% for 8 months and the remaining 25% for 12 months. The transaction noted herein is subject to completion of due diligence, approval of the TSX Venture Exchange and other customary conditions.
Brendan Yurik, CEO of Electric Royalties commented, "We are very pleased to add the Rana 1% NSR to our royalty portfolio as it represents our first exposure to nickel. Furthermore, we are excited about the potential of the mine's restart as well as the prospectivity of the surrounding land package. The mine was shut down in 2002 due to low nickel prices which averaged less than $4/lb during its operation. Nickel prices are more than double what they were when the mine shut down. Given the projects excellent jurisdiction, good infrastructure and available skilled workforce we believe that Rana has excellent potential to help supply the nickel required to transition the world away from fossil fuels and toward a decarbonized global economy."
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 (lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc & 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 has a growing portfolio of 17 royalties, including one royalty that currently generates revenue. The Company is focused predominantly on acquiring royalties on advanced stage and operating projects to build a diversified portfolio located in jurisdictions with low geopolitical risk, which offers investors exposure to the clean energy transition via the underlying commodities required to rebuild the global infrastructure over the next several decades towards a decarbonized global economy.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange), nor any other regulatory body or securities exchange platform, accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statements Regarding Forward-Looking Information and Other Company Information
This news release includes forward-looking information and forward-looking statements (collectively, "forward-looking information") with respect to the Company 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 and may include statements regarding the 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 of the Company and the projects in which it holds royalty interests.
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 projects 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 the owners of these projects to implement their 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 as well as other information filed with the OTC Markets 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 and at otcmarkets.com.
SOURCE Electric Royalties Ltd.
View original content to download multimedia: http://www.newswire.ca/en/releases/archive/October2021/19/c6774.html