COQUITLAM, BC, Oct. 10, 2019 /CNW/ - Canada Cobalt Works Inc.
(TSXV: CCW) (OTC: CCWOF) (Frankfurt: 4T9B) (the "Company" or "Canada
Cobalt") is pleased to announce that the Company has signed a
binding Letter of Intent (the "Transaction") to acquire the assets
of PolyMet Resources Inc. ("PolyMet"), owner of PolyMet Labs (ISO
certified) and the Northern Ontario Silver-Cobalt Camp's only
permitted and operating mineral and precious metal processing
facility.
The Transaction, consummated at a strategic time in the precious
metals cycle, provides Canada Cobalt with multiple immediate and
long-term advantages including a high capacity bullion melting
furnace to pour payable silver and gold dore bars. The 23,400 sq.
foot facility with district leading sampling and analytical
capabilities can also host the Company's proprietary Re-2OX Process
for environmentally friendly extraction of cobalt, precious and
base metals.
Highlights:
- The lab and mineral processing facility will become the new
headquarters of Canada Cobalt and is located in the town of
Cobalt, immediately adjacent to a
rail line and just a short distance from the Company's Castle mine
and Beaver Property;
- This well-established sampling and analytical facility,
specializing in high-grade mineralization, provides commercial
assaying, crushing, screening, grinding, bulk sampling, upgrading
and smelting services all in one location, driving multiple revenue
streams at a time when gold prices in Canadian dollars have hit new
record highs. PolyMet has demonstrated that in an 8-hour shift it
can pour up to 10 dore silver bars of 1,000 ounces each (90% to 95%
fine);
- PolyMet is currently making inroads into the potentially
lucrative e-waste business that can be leveraged through Canada
Cobalt, its extensive relationships and its Re-2OX Process.
Material from mixed computer boards is being processed through the
facility's shredder and ball mill to recover precious and base
metals.
Mr. Frank Basa, President and CEO
of Canada Cobalt, stated: "This deal builds dramatically on Canada
Cobalt's current competitive advantages and opportunities -
technological, on the ground and underground - in a rejuvenated
silver-cobalt district recognized as the birthplace of Canadian
hard rock mining. With such a unique and fully operational facility
in the town of Cobalt, so close to
the Castle mine and other properties, Canada Cobalt achieves a key
goal of becoming a vertically integrated leader in Canada's silver-cobalt heartland while it also
exploits a powerful new cycle in precious metals."
Mr. Gino Chitaroni, majority
owner of PolyMet Resources Inc., commented: "We see some really
exciting synergies here. Canada Cobalt's track record of success in this
district made them the perfect fit to take the PolyMet Lab and
facility to the next level while I remain involved to assist Canada
Cobalt from an operational standpoint.
"We appear to have entered a dynamic new cycle for silver and
gold, which could really help to ignite this business in terms of
its traditional drivers, while we're seeing exciting new
opportunities in the e-waste sector that can be more fully
exploited through this Transaction," Chitaroni continued. "Bullion
pouring, bulk sampling, commercial assaying and e-waste are
PolyMet's four key immediate profit centers that merge with Canada
Cobalt, creating powerful new synergies. Hosting Re-2OX and
accelerating the development of such a unique and environmentally
friendly process at this facility is a major coup for the town of
Cobalt and the broader
district."
Terms of the Transaction
Canada Cobalt and PolyMet have
executed a binding Letter of Intent whereby PolyMet has agreed to
sell 100% of its assets, including but not limited to the property,
the plant and the equipment, all located at 1 Presley Street in
Cobalt, Ontario, for total
consideration of $650,000 (cash and
shares of Canada Cobalt). Also included in the assets are all of
the issued and outstanding shares of PolyMet.
The cash portion of the Transaction is $333,000 while Canada Cobalt will issue to
PolyMet 932,353 shares at 34 cents
per share for the remaining $317,000,
payable upon completion of a due diligence review period not to
exceed 90 days. During this due diligence review, PolyMet will make
available to Canada Cobalt all environmental and title documents,
maps, logs, books, papers, technical data and other pertinent
documents related to the assets.
Current PolyMet personnel, including Mr. Chitaroni, will be
retained on contracts with share-based incentive clauses related to
certain business milestones over the next 12 months. Facility
upgrades combined with an aggressive sales strategy are expected to
help achieve a significant ramp-up in growth and profitability.
These initiatives will be funded by revenues and an approximate
$250,000 investment by Canada Cobalt
over the next six months.
The Canada Cobalt-PolyMet Transaction is subject to TSX Venture
Exchange approval.
Qualified Person
The technical information in this news release was prepared
under the supervision of Frank J.
Basa, P.Eng., Canada Cobalt's President and Chief Executive
Officer, who is a member of Professional Engineers Ontario and a
qualified person in accordance with National Instrument 43-101.
About Canada Cobalt Works Inc.
Canada Cobalt has 100%
ownership of the Castle mine and the 78 sq. km Castle Property with
strong exploration upside in the prolific past producing
Gowganda high-grade Silver Camp of
Northern Ontario. With underground
access at Castle, a pilot plant to produce cobalt-rich gravity
concentrates on site, and a proprietary hydrometallurgical process
known as Re-2OX for the creation of technical grade cobalt sulphate
as well as nickel-manganese-cobalt (NMC) formulations, Canada
Cobalt is strategically positioned to become a vertically
integrated North American leader in cobalt extraction and recovery
while it also exploits a powerful new silver-gold market cycle.
"Frank J. Basa"
Frank J. Basa, P. Eng.
President and Chief Executive Officer
Neither the TSX Venture Exchange nor its Regulation Service
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. This news release may contain
forward-looking statements including but not limited to comments
regarding the timing and content of upcoming work programs,
geological interpretations, receipt of property titles, potential
mineral recovery processes, etc. Forward-looking statements address
future events and conditions and therefore, involve inherent risks
and uncertainties. Actual results may differ materially from those
currently anticipated in such statements.
SOURCE Canada Cobalt Works Inc.