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VANCOUVER, British Columbia, Dec. 02, 2021 (GLOBE NEWSWIRE) -- Search Minerals Inc. (TSXV: SMY | OTCQB: SHCMF) (“Search” or the “Company”) is pleased to announce that, further to its August 11th press release, it has now closed the purchase of a 2.5% Net Smelter Royalty (“NSR”) from B&A Minerals Limited (“B&A”) for 15,000,000 common shares in the share capital of the Company. The transaction also included some property transfers between the parties. The 15,000,000 common shares that have been issued by Search will be restricted and released over 24 months, with 25% being released every 6 months following the date of the closing.
Net Smelter Royalty
B&A held a 3% NSR Royalty (“Royalty”) over the licenses contained in a large portion of the Company’s Critical Rare Earth Element District in SE Labrador. Following closing, B&A will retain 0.5% NSR on the remaining consolidated 3 licenses including the Foxtrot project, along with our prospects of Fox Meadow, Silver Fox, Awesome Fox and up to 20 other prospects. The Company had the option to purchase 2% of the Royalty for $2,000,000 as per the 2009 B&A Mining Option Agreement (“Option Agreement”). Search has exercised that right along with the purchase of an additional 0.5% of the Royalty.
Also, for greater certainty, the 2009 Mining Option Agreement between B&A and Search has now been fully discharged without any further existing or future contractual obligations between the parties.
As part of the Royalty purchase, B&A and Search have transferred some additional licenses between each other.
B&A and associates has transferred the following Licenses which are in the proximity of the Company’s Fox Meadow prospect: Fox Meadow area (027318M, 032539M, part of 027599M and part of 027429M) and in the process of transferring Deep Fox area (027447M). These licenses are included in the updated NSR registration and will be subject to the existing 0.5% NSR. Search will grant B&A the quarry/gem rights on the above 4 licenses transferred in the Fox Meadow area only after Search has explored/developed those licenses in exchange for a 3% NSR or similar form of royalty.
Search has transferred license 024083M to B&A and has received a 0.5% NSR royalty in return. This license does not form any part of our Critical Rare Earth Element District.
Greg Andrews, President and CEO states: “We believe the reduction of the Royalty, will provide flexibility with our future discussions regarding offtake agreements and funding for the projects. Our immediate goal remains our “Sprint to Production” to advance our Critical Rare Earth Element District. We expect to have an updated Preliminary Economic Assessment report (“PEA”) completed by Q1 2022. The relevant and significant milestones our team have accomplished since 2016 will be presented in this PEA. We are expecting significant increase in the annual gross revenue, with the increased production rate, higher grades and improved recovery rates from our patented Direct Extraction technology. We continue to optimize our processing flowsheet with magnetic separation producing a concentrate to go to our Direct Extraction process. We are anticipating capital and operating costs benefits with the new flowsheet.”
About Search Minerals Inc.
Led by a proven management team and board of directors, Search is focused on finding and developing Critical Rare Earths Elements (CREE), Zirconium (Zr) and Hafnium (Hf) resources within the emerging Port Hope Simpson – St. Lewis CREE District of South East Labrador. The Company controls a belt 63 km long and 2 km wide and is road accessible, on tidewater, and located within 3 local communities. Search has completed a preliminary economic assessment report for FOXTROT, and a resource estimate for DEEP FOX. Search is also working on three exploration prospects along the belt which include: FOX MEADOW, SILVER FOX and AWESOME FOX.
Search has continued to optimize our patented Direct Extraction Process technology with generous support from the Department of Tourism, Culture, Industry and Innovation, Government of Newfoundland and Labrador, and from the Atlantic Canada Opportunity Agency. We have completed two pilot plant operations and produced highly purified mixed rare earth carbonate concentrate and mixed REO concentrate for separation and refining.
For further information, please contact:
President and CEO
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.
Cautionary Statement Regarding “Forward-Looking” Statements:
Except for the statements of historical fact, this news release contains "forward-looking information" within the meaning of the applicable Canadian securities legislation that is based on expectations, estimates and projections as at the date of this news release. "Forward-looking information" in this news release includes information about the Company’s proposed exploration programs described herein, and other forward-looking information. Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, the inability to obtain the necessary resources to complete the exploration programs and poor exploration results.
The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made assumptions about the Company's financial condition and development plans do not change as a result of unforeseen events, and that the Company will receive all required regulatory approvals,.
Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein. The Company does not assume any obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements, unless and until required by applicable securities laws. Additional information identifying risks and uncertainties is contained in the Company's filings with the Canadian securities regulators, which filings are available at www.sedar.com.