TORONTO, May 28, 2020 /CNW/ - Nubian Resources Ltd.
(TSX-V:NBR) ("Nubian" or the "Company") is pleased to announce that
on May 21, 2020 the Company entered
into a binding letter of intent ("LOI"), subject to final due
diligence and negotiation of definitive agreements, to acquire the
Yandoit Gold Project, situated in the historic Daylesford gold
corridor of central Victoria,
Australia. The approximately 38 square kilometre (3,800 ha)
property consists of one Mining Licence and one Exploration
Licence, collectively the "Project". The vendor, B.S.B.
Mining Pty Ltd. ("BSB Mining"), an arm's length party to Nubian, is
currently finalizing the purchase of a second Exploration Licence
that has six historic gold mines.
Located about 39 km northeast of the city of Ballarat and 100 km
northwest of Melbourne, the
advanced-stage Yandoit Gold Project is in a region that has seen
punctuated periods of hard rock and alluvial gold mining over the
past 160 years. Local geological environments are very
similar to that seen in the higher activity Bendigo (e.g.,
Fosterville Mine, 70 km to the northeast), Castlemaine, and
Malmsbury gold corridors located to the north and northeast.
Sustained higher gold prices and recent success in
understanding the gold depositional geology by Kirkland Lake Gold at its Fosterville Gold Mine
has caused a modern day gold rush in the region.
Martin Walter, President &
CEO of Nubian, commented, "Nubian is very pleased to have secured
an opportunity to explore and develop an advanced-stage project in
this exciting gold district of Australia. The Project is drill-ready
with extensive deep radar geophysics being completed over 16 line
kms. The goal is to fast-track the Project towards mine
development. In conjunction with its aggressive plans to
develop the Project, the Company is planning to undertake a private
placement with the proceeds being utilized to acquire the option
and advance drilling as soon as possible with a focus on the two
known gold reefs, the Golconda and the Goldsmith reefs."
Property Geology Details
Gold mineralization in the Bendigo, Malden and Yandoit-Franklinford districts
typically occurs as course gold in sediment-hosted stacked quartz
reefs and within rich alluvial surface deposits. The gold-bearing
quartz reefs form in faults and along dilational features
associated with anticlinal and synclinal folds and structural
offsets. Recent sampling by BSB Mining (not confirmed by Nubian)
returned gold grades up to 60 g/t Au from various parts of the
Project.In 2008, prospectors discovered several 20oz+ specimens
near the Golconda workings and extracted approximately 1,000 oz of
alluvial gold and in July 1895, at
Nuggetty Gully, Yandoit, near Daylesford, a former miner (Mr.
George Brown) made the lucky
discovery of a nugget estimated to contain 238oz of
gold. Historical literature on the Project notes the
Project's high gold grades and several sizeable gold nuggets that
have been found at surface, some very recently. Typical high-grade
gold grades and widths in the Project area are +12-34 g/t Au over
one to two metres.
Nubian has no knowledge of the reliability of the information
included above and the Company notes that additional sampling,
drilling and quality control will be required to verify the
information. The Company plans to prepare a National
Instrument 43-101 Technical Report on the Project in accordance
with regulatory requirements.
The heart of the Yandoit Gold Project covers a 5 km long gold
mineralized corridor that has been outlined at surface, defined
through historical and current gold showings, exploration pits,
gold reef workings, surface gossans, and gold bearing alluvial
sands. The current Project operator, BSB Mining, has geologically
mapped the 5 km long corridor, installed crushing and gold
extraction equipment on site, has been intermittently producing
gold from alluvial sediments. In 2019, BSB Mining installed a
head-frame and a mine shaft down to the 27 metre level and three
drives towards to Goldsmith's reef. This development work
targeted gold mineralization associated with sediment-hosted quartz
reefs that are typical of high-grade gold targets in the Victoria
Goldfields.
The five km long variably mineralized corridor will be the focus
of Nubian's future exploration and drilling programs, designed to
test for gold mineralization below and along strike of the current
mine development activities.
Acquisition Terms
Under the terms of the LOI, Nubian has paid an AU$20,000
(approximately, C$18,300) deposit for
an exclusivity period of 90 days during which time Nubian will
undertake due diligence and complete a financing of a minimum of
AU$650,000 (approximately, C$595,000)
and the parties will negotiate and enter into a definitive
agreement. As part of the LOI, BSB Mining will be granted 2%
net smelter return royalty, which can be purchased by Nubian at
AU$250,000 (approximately, C$229,000)
at any time after 36 months from the definitive agreement
date.
Under the terms of the LOI, Nubian will acquire the 60%
interest in the Yandoit Gold Project in exchange for (i) a cash
payment of AU$180,000 (approximately, C$165,000) on the definitive agreement date, (ii)
the issuance, on the definitive agreement date, of AU$750,000
(approximately, C$686,500) of Nubian
common shares priced at a $0.15 per
common share (a maximum of approximately 4,600,000 common shares)),
or at the share issuance price of its planned private
placement; and (iii) the issuance on the date that is 18 months
from the definitive agreement date of AU$750,000 (approximately,
C$686,500) of Nubian common shares
priced at the 20-day volume-weighted average price ("VWAP")
immediately preceding such date, up to a maximum of approximately
4,600,000 common shares. Additional payments under the LOI
include: (i) a one-time payment of AU$50,000 (approximately,
C$45,800) due 12 months from the
signing of the definitive agreement; (ii) the sum of AU$150,000
(approximately, C$137,300), payable,
at the Company's election, in cash or in common shares of Nubian
priced at the 20-day VWAP immediately preceding the date on which
BSB Mining provides confirmation to Nubian of the transfer to it of
ownership of the second exploration license, up to a maximum of
920,000 common shares; and (iii) an exploration expenditure
commitment of AU$1 million (approximately, C$915,400) in the 24 month period post the
signing of the definitive agreement. To acquire the remaining
40% interest in the Project, Nubian has agreed to make a payment of
AU$3.5 million (approximately, C$3.2
million) within 36 months of the date of the definitive
agreement, payable in common shares of Nubian priced at the 20-day
VWAP immediately preceding the date that is 36 months of the
definitive agreement date.
Closing of the acquisition is expected to occur August 19, 2020 and is subject to, among other
things, the receipt of all necessary approvals and all conditions
having been satisfied or waived with respect to the terms of the
LOI including the approval of the TSX Venture Exchange (the
"Exchange"). Technical information in this news release has
been reviewed and approved by Dr. Scott
Jobin-Bevans (P.Geo.), a Director of Nubian, who is a
Qualified Person under the definitions established by the National
Instrument 43-101.
Private Placement
In connection with the acquisition, the Company is undertaking a
non-brokered private placement of up to $1,500,000 through the issuance of up to
10,000,000 units, each Unit being priced at $0.15 and comprising one common share and
one-half common share purchase warrant (each whole common share
purchase warrant, a "Warrant"). Each Warrant is exercisable
at $0.20 for a period of 24 months
post the closing date, provided, however that, if, at any time
following the expiry of the statutory four month hold period, the
closing price of the common shares on the Exchange is greater than
$0.50 for 20 or more consecutive
trading days, the Warrants will be accelerated and the Warrants
will expire on the 20th business day following the date
of such notice. In connection with the private placement, the
Company may pay finder's fees of 6% cash and 6% compensation
warrants in accordance with the policies of the Exchange.
ABOUT NUBIAN
Nubian Resources Ltd. is a public traded precious and base
metals exploration company listed on the TSX Venture Exchange. The
Company is managed by a team of experienced mining and geological
professionals. Nubian's main asset is the Esquilache
Silver-Zinc Project located within the Tintaya porphyry copper belt
of southern Peru. In May 2020,
Nubian entered into an agreement to acquire and develop the Yandoit
Gold Project in central Victoria,
Australia.
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.
Caution Regarding Forward Looking Statements
Certain
statements contained in this press release constitute
forward-looking information. These statements relate to future
events or future performance. The use of any of the words "could",
"intend", "expect", "believe", "will", "projected", "estimated" and
similar expressions and statements relating to matters that are not
historical facts are intended to identify forward-looking
information and are based on Nubian's current belief or assumptions
as to the outcome and timing of such future events. Actual future
results may differ materially. In particular, this release contains
forward looking information relating to, among other things,
statements with respect to the potential completion of the
acquisition and the Private Placement, the terms and conditions of
the acquisition and the Private Placement and the potential
benefits of the acquisition and the Project. Various assumptions or
factors are typically applied in drawing conclusions or making the
forecasts or projections set out in forward-looking information.
Those assumptions and factors are based on information currently
available to Nubian. Although such statements are based on
reasonable assumptions of Nubian's management, there can be no
assurance that any conclusions or forecasts will prove to be
accurate.
Forward-looking information contained in this news release is
based on certain factors and assumptions regarding, among other
things, the Project, the Acquisition and the Private Placement, and
other similar matters. While Nubian considers these assumptions to
be reasonable based on information currently available to them,
they may prove to be incorrect. Forward looking
information involves known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking information. Such factors include risks inherent in
the exploration and development of mineral deposits, including
risks relating to changes in project parameters as plans continue
to be redefined, risks relating to variations in grade or recovery
rates, risks relating to changes in mineral prices and the
worldwide demand for and supply of minerals, risks related to the
COVID-19 pandemic and current global financial conditions,
increased competition, access and supply risks, reliance on key
personnel, operational risks regulatory risks, including risks
relating to the acquisition of the necessary licenses and permits,
financing, capitalization and liquidity risks, title and
environmental risks and risks relating to delay or failure to
satisfy the closing conditions to the Acquisition and the Private
Placement.
The forward-looking information contained in this release is
made as of the date hereof, and Nubian is not obligated to update
or revise any forward-looking information, whether as a result of
new information, future events or otherwise, except as required by
applicable securities laws.
Because of the risks, uncertainties and assumptions contained
herein, investors should not place undue reliance on
forward-looking information. The foregoing statements expressly
qualify any forward-looking information contained herein.
SOURCE Nubian Resources Ltd.