MGX Minerals To Acquire Petrolithium and
Spodumene-Bearing Pegmatite Project Portfolio from Power Metals
Corp.
VANCOUVER, BRITISH COLUMBIA -- August 02, 2017 --
InvestorsHub Newswire -- MGX Minerals Inc. (MGX or the
Company) (CSE: XMG / FKT: 1MG / OTC: MGXMF) announces it has entered
into a Binding Letter of Intent (the LOI) with Power Metals Corp.
(Power Metals) dated July 27th, 2017 to acquire certain interests
held by Power Metals in exchange for common shares of the Company
(the Proposed Transaction).
The Proposed Transaction terms are as follows:
- MGX will acquire all of Power Metals U.S. Petrolithium Brine
assets (listed below) and a 20 percent working interest in all of
Power Metals current hard rock assets and any future assets
acquired by Power Metals for the following 36 months;
- MGX will have the right to purchase an additional 15 percent
working interest in Power Metals hard rock assets for a period of
36 months for a total of C$10,000,000.
- MGX will receive a call option to purchase up to 10,000,000
common shares of Power Metals at a price of C$0.65 per share for a
period of 36 months.
- MGX will issue Power Metals 3,000,000 common shares. These
shares will be restricted and subject to a release schedule of
1,000,000 shares every 5 months from the signing of the definitive
agreement.
The Transaction terms are subject to amendment based on tax and
legal advice, and that the Parties agree to work together in good
faith to negotiate and settle the final terms of the Transaction to
be incorporated into the Definitive Agreements.
The LOI provides for an exclusive dealing period (the
Exclusivity Period) commencing on acceptance of the LOI and ending
on the date of closing of the Definitive Agreements, unless
otherwise extended by the Parties. During the Exclusivity Period:
(i) the Parties will continue their due diligence investigations in
respect of each other, as applicable, and their respective
businesses, operations, assets, financial condition and affairs;
(ii) the Parties will proceed with the negotiation and settlement
of the terms of the binding Definitive Agreements in respect of the
Transaction; and, (iii) the Parties will cooperate in making
application and providing all necessary information to the TSX
Venture Exchange (TSXV) and the Canadian Securities Exchange (CSE)
in order to obtain pre-clearance of the Transaction and all matters
related thereto.
Johnathan More, Chairman of Power Metals states, "We are pleased
to have signed this deal with MGX Minerals, unquestionably the
leader in the petrolithium space. Aligning ourselves to participate
in the evolution of the new energy industry, our shareholders will
be best served with our asset package being shepherded by MGX. At
the technical forefront of the lithium industry, MGXs drive and
domain expertise have the potential to drive value for related
participants. This partnership allows PWM to focus on its marquee
Case Lake hard rock pegmatite asset with drilling commencing in the
coming days followed by metallurgy work by MGX using its new
technology applied to our lithium hard rock prospect. Additionally,
our shareholders will continue to benefit and see potential upside
in these petrolithium assets being run by MGX through the large
share position PWM will own in their company".
Power Metals U.S. Petrolithium Properties
Paradox Basin, Utah
PWM has an executed joint venture with American Potash Corp.,
("AMP") to explore and develop lithium brines totaling 13,520
acres. AMPs US Federal claims and Utah state leases cover known
brine-hosting clastic stratigraphy in the Paradox Formation.
Coyote Project Lisbon Valley, Utah
The Project includes 150 placer mineral claims covering an area
of 3,000 acres and inclusive of lithium brine mineral rights, on
trend and adjoining to the north, the Lisbon Valley oil and gas
field, where historic lithium brine content has been reported as
high as 730 parts per million lithium (Superior Oil 88-21P). The
Lisbon Valley oil and gas field is located approximately 40 miles
southeast of Moab, Utah in the salt anticline belt on the southwest
edge of the Paradox Basin in San Juan county. The oilfield was
first discovered by Pure Oil Company in 1960. The Lisbon field
produces oil and gas from the southwest flank of a faulted
anticlinal trap in the Devonian sandstones and Mississippian
limestones (Segal et al., 1986).
PWM Hard Rock Properties:
Case Lake
Case Lake spodumene pegmatite swarm is located 80 km east of
Cochrane, northeastern Ontario. Case pegmatite swarm consists of
five dykes exposed on surface: North, Main, South, East and
Northeast Dyke. North, Main and Northeast Dykes contain spodumene.
The North Dyke has greater than 100 m strike length, the Main
Dyke has greater than 350 m strike length and the Northeast
Dyke has greater than 75 m strike length. Power Metals' summer
2017 exploration program on the Case Lake Property will consist of
approximately 30 drill holes. The drilling will target the North
and Main Dykes to define the pegmatite and lithium mineralization
and to extend the dykes to the east and west along strike and down
dip. There is 100 m of surface exposed strike length for the Main
Dyke that has not yet been drill tested. The Company will also test
the possibility that the Main Dyke is actually two parallel
pegmatite dykes not just one dyke. Since the pegmatite dykes within
the Case Lake pegmatite swarm are parallel to each other, there is
potential to find additional buried dykes at depth.
Paterson Lake
The Paterson Lake Property is located 75 km north of Kenora,
northwestern Ontario in Paterson Lake. The Property is composed of
64 mining claims totaling 1198 ha and is approximately 15 km by 5
km in size. The project is proximal to Avalon's Big Whopper
pegmatite which is located about 3 km west of the western edge of
the claim block. This has a strike length of 600m to a maximum
vertical depth of 250m.
Gullwing - Tot Lake
The Gullwing - Tot Lake Property is located 30 km northeast of
Dryden, northwestern Ontario in Webb township. The Property is
composed of 76 mining claims totaling 1216 ha and is approximately
17 km by 1.5 km in size. The Gullwing - Tot Lake pegmatites are
located 13 km north east of International Lithium Corp.'s Mavis
Lake - Fairservice pegmatites. International Lithium's partner
Pioneer Resource Limited completed 12 drill holes totaling 1,305 m
on March 2, 2017 on the Mavis Lake Property with drill highlights
of 1.47 % Li2O over 17.9 m and 1.70 % Li2O over 26.3 m
(International Lithium, press release dated April 11, 2017).
Larder River
Larder River is in the same South Mountain Batholith of extruded
igneous rock that contains Brazil Lake (Larder is in the center of
this batholith and Brazil Lake is at the south end). Larder River
has, at surface, extrusion of light colour granite rock just like
Brazil Lake. These granites host pegmatite dikes which contain high
grades of Lithium, Tantalum and Rubidium. Brazil Lake pegmatite
boulder sampling in 2011, looking for new pegmatites to drill test
showed results in the same range for Lithium as the anomalies seen
in the soil sampling program at Larder River. A core drilling
program of 28 holes in 2011 at Brazil Lake encountered extensive
LiO² mineralization.
Completion of the Proposed Transaction is subject to a number of
conditions including, but not limited to completion of satisfactory
due diligence, the negotiation and execution of a definitive
agreement and the receipt of applicable regulatory approvals,
including the approval of the CSE and the TSX.
Qualified Person
The technical portions of this press release were prepared and
reviewed by Andris Kikauka (P. Geo.), Vice President of Exploration
for MGX Minerals. Mr. Kikauka is a non-independent Qualified Person
within the meaning of National Instrument (N.I.) 43-101
Standards.
About MGX Minerals
MGX Minerals is a diversified Canadian resource company with
interests in petrolithium, magnesium and silicon assets throughout
North America. Learn more at www.mgxminerals.com.
Contact Information
Jared Lazerson
President and CEO
Telephone: 1.604.681.7735
Web: www.mgxminerals.com
Neither the Canadian Securities Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
Canadian Securities Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Forward-Looking Statements
This press release contains forward-looking information or
forward-looking statements including the completion of the rights
offering (collectively "forward-looking information") within the
meaning of applicable securities laws. Forward-looking information
is typically identified by words such as: "believe", "expect",
"anticipate", "intend", "estimate", "potentially" and similar
expressions, or are those, which, by their nature, refer to future
events. The Company cautions investors that any forward-looking
information provided by the Company is not a guarantee of future
results or performance, and that actual results may differ
materially from those in forward-looking information as a result of
various factors. The reader is referred to the Company's public
filings for a more complete discussion of such risk factors and
their potential effects which may be accessed through the Company's
profile on SEDAR at www.sedar.com.
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