THUNDER BAY, ON, Nov. 16, 2017 /CNW/ - Wolfden Resources
Corporation (WLF:TSX-V) ("Wolfden" or
the "Company") is pleased to announce that it has
completed the previously announced acquisition of a 100% interest
in the Pickett Mountain Property, located in Penobscot County, northern Maine, U.S.A (the "Property") for a
cash purchase price of US$8.5 million
(the "Acquisition"). The Property comprises 6,871
acres of timberland and all minerals, mining, subsurface and
surface rights owned by the seller, and includes the Pickett
Mountain base metal deposit (the "Pickett Mountain
Project").
To fund the Acquisition, the Company granted a 1.35% gross sales
royalty on the Pickett Mountain Project to a subsidiary of Altius
Minerals Corporation ("Altius", ALS:TSX) for cash
consideration of US$6,000,000 and
completed a non-brokered private placement (the "Offering")
of 20,200,000 subscription receipts ("Subscription
Receipts") at a price of C$0.25
per Subscription Receipt for gross proceeds of C$5,050,000, with Altius subscribing for
14,200,000 Subscription Receipts.
The Financing
Immediately prior to the completion of the Acquisition, upon
satisfaction of the escrow release conditions in respect of the
Subscription Receipts, each holder of Subscription Receipts
received, without the payment of additional consideration or
further action on the part of the holder, one unit of the Company
(each a "Unit"). Each Unit comprised of one common share of
the Company (a "Common Share") and one half (1/2) of one
common share purchase warrant of the Company (each whole warrant, a
"Warrant"). Each Warrant is exercisable to acquire one
Common Share (a "Warrant Share") at price of C$0.35 for a period of 60 months from the closing
date of the Offering.
All securities issued pursuant to the Offering are subject to a
statutory four-month hold period in accordance with Canadian
securities legislation and the TSX Venture Exchange.
In connection with the Offering, the Company has paid an
aggregate of $49,775 in cash finder's
fees to Medalist Capital Ltd., Sprott Global Resources Investments,
Ltd. and Haywood Securities Inc. in connection with purchases of
Subscription Receipts made by subscribers introduced by such
parties. A further $177,500 in cash
finder's fees and, subject to the approval of the TSX Venture
Exchange, a $100,000 advisory fee
will be paid by the Corporation to Cormark Securities Inc. in
connection with the Offering and the Altius royalty,
respectively.
A related party of the Company has participated in the Offering
on the same terms as arm's length investors. The Company did not
file a material change report more than 21 days before the expected
closing date of the Offering as the details of the Offering,
including participation therein by related parties of the Company,
had not been confirmed at that time and the Offering was completed
taking into account the timeframe of the Acquisition. A copy of the
material change report in respect of the matters referenced in this
news release will be available on www.sedar.com.
The Royalty Agreement
Pursuant to the royalty agreement between Altius and the Company
(the "Royalty Agreement"), Altius has the option to purchase
an additional 0.50% gross sales royalty at any time before the
first anniversary of commercial production for US$7,500,000. Under the Royalty Agreement, the
Corporation has also granted to Altius certain rights to convert
the royalty to equity under certain circumstances or to exchange
the royalty for a similar royalty on the Corporation's Orvan Brook property.
The Pickett Mountain Project and New Mining Laws in
Maine
The Pickett Mountain Zn-Pb-Cu-Ag deposit is known to be one of
the highest-grade undeveloped volcanogenic massive sulphide
deposits (VMS) in North America.
The deposit was discovered by Getty Mines Ltd. in 1979, using a
combination of soil surveys ground surveys and diamond drilling and
has not been explored since 1989.
Wolfden management believes that the Property has excellent
potential to host an economic VMS deposit as evidenced by grades
obtained from historic diamond drilling1 that
intersected (true widths):
- 18.66% Zn, 10.27% Pb, 1.63% Cu & 6.72 oz/t Ag over 7.70
metres
- 14.65% Zn, 6.48% Pb, 2.74% Cu & 3.78 oz/t Ag over 7.68
metres
- 15.95% Zn, 7.41% Pb, 1.41% Cu & 5.25 oz/t Ag over 7.30
metres
- 13.71% Zn, 5.25% Pb, 1.07% Cu & 3.57oz/t Ag over 6.30
metres
1 Data documented in an internal report authored
by Getty Mines Ltd.
The deposit has been traced over a strike length of close to 900
metres and appears to be open at depth. Wolfden plans to begin
drilling in the near future with a mineral resource estimate
planned in 2018.
Preliminary metallurgical test work completed on drill core
produced 3 floatation concentrates with resulting recoveries of 80%
for copper, 78% for lead and 88% for zinc; considered to be
excellent recoveries compared to most massive sulphide deposits
situated in the North American Appalachians. A number of untested
Cu-Pb-Zn soil anomalies situated along strike from the known
deposit and distal to the deposit, auger well for the potential to
find additional similar mineralization elsewhere on the land
tract.
Recently, LD 820 was enacted by the Maine legislature, permitting mining of
metallic minerals in Maine in
certain prescribed situations. The new legislation took effect on
November 1, 2017. Prior to the
introduction of proposed new legislation in 2013 and the enactment
of LD 820 into law in 2017, there was little mining and mineral
exploration in Maine. Interest in
the geology and potential for VMS projects like the Pickett
Mountain Project has been revived with zinc and copper price
appreciation and the opening up of the mine permitting regime under
specific prescribed limitations. Wolfden sees significant
exploration opportunity in this jurisdiction that it believes is
vastly under-explored.
About Wolfden Resources:
Wolfden is a mineral exploration company exploring the Rice
Island and Nickel Island properties in Manitoba. Manitoba is ranked #2 in Canada and #2 in the World as the most
favourable jurisdiction to conduct mining and exploration (Fraser
Institute (2016-2017). The Company also retains a 16,000 hectare
land position in the Bathurst Mining Camp in northern New Brunswick.
About Altius
Altius directly and indirectly holds diversified royalties and
streams that generate revenue from 15 operating mines. These are
located in Canada and Brazil and produce copper, zinc, nickel,
cobalt, iron ore, potash and thermal (electrical) and metallurgical
coal. The portfolio also includes numerous pre-development stage
royalties covering a wide spectrum of mineral commodities and
jurisdictions. In addition, Altius holds a large portfolio of
exploration stage projects which it has generated for deal making
with industry partners that results in newly created royalties and
equity and minority interests.
Altius has 43,187,291 shares issued and outstanding that are
listed on Canada's Toronto Stock
Exchange. It is a member of both the S&P/TSX Small Cap and
S&P/TSX Global Mining Indices.
The information in this news release has been prepared and
approved by Donald Hoy, M.Sc., P.
Geo., President and CEO and a director of the Company. Mr. Hoy is
also a Qualified Person under National Instrument 43-101.
Cautionary Statement regarding Forward-Looking
Information
This news release contains certain information that may
constitute forward-looking information or forward-looking
statements under applicable Canadian and United States securities legislation
(collectively, "forward-looking information"), including but not
limited to information about future drilling activities at the
Pickett Mountain Project; the timing and completion of an
anticipated mineral resource estimate at the Pickett
Mountain Project; and the scope of and the anticipated
effect of new mining legislation in Maine. This forward-looking information
entails various risks and uncertainties that are based on current
expectations and actual results may differ materially from those
contained in such information. These uncertainties and risks
include, but are not limited to, the strength of the global
economy; the price of base metals and minerals generally;
operational, funding and liquidity risks; the degree to which
mineral resource estimates are reflective of actual mineral
resources; the degree to which factors which would make a mineral
deposit commercially viable are present; the risks and hazards
associated with mineral exploration and mining operations; and the
ability of Wolfden to fund its substantial capital requirements and
operations. Risks and uncertainties about the Company's business
are more fully discussed in the Company's disclosure materials
filed with the securities regulatory authorities in Canada available at www.sedar.com. Readers are
urged to read these materials. Wolfden assumes no obligation to
update any forward-looking information or to update the reasons why
actual results could differ from such information unless required
by law.
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.
SOURCE Wolfden Resources Corporation