TIDMPXC
RNS Number : 3396Q
Phoenix Copper Limited
27 October 2021
Phoenix Copper Limited / Ticker: PXC / Sector: Mining
27 October 2021
Phoenix Copper Limited
(" Phoenix " or the "Company")
Acquisition of Empire Mine royalty and mining claims
Phoenix Copper Ltd (AIM: PXC; OTCQX: PXCLF), the AIM quoted USA
focused base and precious metals emerging producer and exploration
company, is pleased to announce that it has entered into agreements
with Honolulu Copper Corporation ("Honolulu") and Mackay LLC
("Mackay") to acquire part of the 2.5% royalty payable to each of
them, and the Honolulu mining claims, pursuant to the Mining Leases
on the Empire Mine in Idaho, USA (the "Agreements").
Pursuant to the terms of the Agreements, Phoenix has acquired
1.25% of the royalty payable to Honolulu, including Honolulu's
underlying patented and unpatented mining claims, and 1% of the
royalty payable to Mackay, for a total consideration of $1.3
million payable in cash, $550,000 of which has been paid, and
$750,000 of which is payable in three instalments of $250,000 each,
due on 31 December 2021, 2022, and 2023.
Following the acquisition of the royalty, Konnex Resources Inc,
the Company's 80% owned Idaho registered subsidiary and operator of
the Empire Mine (" Konnex "), will pay a 1.25% royalty to Honolulu
plus a 1.25% royalty to Phoenix, or a 1.5% royalty to Mackay plus a
1% royalty to Phoenix, based on the order in which the respective
claim blocks are mined.
The underlying patented and unpatented mining claims acquired
from Honolulu will be owned by Phoenix's 100% owned Idaho
registered subsidiary, Lost River Resources Inc (" Lost River ").
As a result, the Mining Lease with Honolulu has been terminated and
will be replaced by a new mining agreement between Konnex and Lost
River with substantially the same terms as the prior Mining Lease
with Honolulu. Konnex's existing rights and obligations with regard
to the Empire Mine will therefore remain unchanged. The terms of
the Mining Lease with Mackay will also remain unchanged.
Richard Wilkins, CFO of Phoenix Copper, commented: "Our
preliminary economic model for the Empire open pit mine, which is
based on a $3.60 copper price, forecasts gross revenue of $836
million over an initial 10-year project life. The royalty now
payable to Phoenix should therefore represent significant
additional revenue to Phoenix over the same period and is intended
to contribute additional funds to the corporate dividend policy
which we plan to adopt for the benefit of our shareholders.
"As some of the mining claims cover portions of the potential
Red Star silver - lead deposit, Phoenix will also benefit from the
royalty otherwise payable to Honolulu or Mackay on Red Star, as
well as on the deeper underground sulphide copper deposit, as and
when those projects start to generate revenue. The patented mining
claims now owned by Phoenix's 100% owned Idaho registered
subsidiary, Lost River, are considered fee simple (private land)
and the ownership includes both surface and mineral rights."
Environmental, Social and Corporate Governance
Phoenix is committed to meeting and exceeding the environmental
standards required by law as a core value of the Company. The
baseline environmental data collected to date will be used for
furthering the permitting process, but as importantly, will be used
as the building blocks for the Company's ongoing Environmental,
Social, and Corporate Governance (" ESG ") platform, overseen by
the Company's ESG & Sustainability Committee.
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 which has been
incorporated into UK law by the European Union (Withdrawal) Act
2018. Upon the publication of this announcement via Regulatory
Information Service, this inside information is now considered to
be in the public domain.
Contacts
For further information please visit https://phoenixcopperlimited.com or contact:
Phoenix Copper Limited Ryan McDermott Tel: +1 208 954
Dennis Thomas 7039
Richard Wilkins Tel: +44 7827
290 849
Tel: +44 7590
216 657
SP Angel (Nominated David Hignell / Caroline Rowe Tel: +44 20 3470
Adviser) 0470
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Brandon Hill Capital Jonathan Evans / Oliver Stansfield Tel: +44 20 3463
(Joint Broker) 5000
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WH Ireland (Joint Harry Ansell / Adam Pollock Tel: +44 207 2201666
Broker) / Katy Mitchell
------------------------------------ ---------------------
Panmure Gordon (UK) John Prior / Hugh Rich / Ailsa Tel: +44 20 7886
Limited (Joint Broker) Macmaster 2500
------------------------------------ ---------------------
EAS Advisors (US Matt Bonner / Rogier de la Rambelje Tel: +1 (646)
Corporate Adviser) 495-2225
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Blytheweigh Tim Blythe / Megan Ray Tel: +44 20 7138
(Financial PR) 3204
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Notes
Phoenix Copper Limited is a USA focused, base and precious
metals emerging producer and exploration company, initially
targeting copper and zinc production from an open pit mine from
late 2022.
Phoenix's primary operations are focused near Mackay, Idaho in
the Alder Creek mining district, at the 80% owned Empire Mine
property, which historically produced copper at grades of up to 8%,
as well as gold, silver, zinc and tungsten, from an underground
mine.
Since 2017, Phoenix has carried our extensive drill programmes
which have defined a NI 43-101 compliant PEA (preliminary economic
assessment) for an open pit heap leach solvent extraction and
electrowinning ("SX-EW") mine, which was updated in October 2020.
The contained metal in all NI 43-101 compliant categories of
resources, measured, indicated and inferred, stand at 129,641
tonnes of copper, 355,523 ounces of gold, 10,133,772 ounces of
silver and 58,440 tonnes of zinc. Phoenix updated its economic
model in February 2021 to include the processing of all contained
metals through a two phased approach.
In addition to Empire, the district includes the historic
Horseshoe, White Knob and Blue Bird Mines, past producers of
copper, gold, silver, zinc, lead and tungsten from underground
mines. A new discovery at Red Star, 330 metres northwest of the
Empire Mine proposed open pit, has revealed high grade silver /
lead sulphide ore and from three shallow exploration drill holes a
NI 43-101 compliant maiden resource of 1.6 million silver
equivalent ounces was reported. Additionally, the district includes
Navarre Creek, a volcanic hosted, Carlin-type gold discovery which
hosts a 6.1 km gold strike length within a 14.48 km(2) area. The
Company's total land package at Empire comprises 8,034 acres (32.51
sq kms).
At Empire, it is estimated that less than 1% of the potential
ore system has been explored to date and, accordingly, there is
significant opportunity to increase the resource through phased
exploration. The stated aim of the Company is to fund this phased
exploration through free cashflow generated by its initial mine. A
Plan of Operations in respect of the initial open pit mine was
filed with the relevant regulatory authorities in June 2021.
Phoenix also has two wholly owned cobalt properties on the Idaho
Cobalt Belt to the north of Empire. An Earn-In Agreement has been
signed with First Cobalt Corporation, Toronto, in respect of one of
those properties.
More details on the Company, its assets and its objectives can
be found on PXC's website at https://phoenixcopperlimited.com.
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