SIGNS LOI WITH COBALTECH
First Cobalt Corp. (FCC.V) has entered into a non-binding letter of intent (LOI) to acquire all of the issued and outstanding shares of CobalTech Mining Inc., (CSK.V)an arm's-length party, through a negotiated share exchange transaction.
CobalTech has assembled a strong portfolio of prospective cobalt properties, including 11 past-producing mines in the town of Cobalt, Ont., the Werner Lake East cobalt property near Kenora, Ont., and eight properties in the province of Quebec. Its flagship asset is the Duncan Kerr project and includes the past-producing Kerr Lake and Lawson mines, which operated between 1905 and 1966 and reportedly produced approximately 32.7 million ounces of silver as well as significant cobalt byproduct.
CobalTech also owns a 100-tonne-per-day mill in the town of Cobalt. This asset would complement the Yukon refinery, over which First Cobalt has a joint venture option for a 50-per-cent interest.
CobalTech has 6,588 tonnes of crushed stockpile with an average grade of 761 grams per tonne silver and 0.95 per cent cobalt over 2,000 samples on its Duncan Kerr property. The potential quantity and grade of this stockpile is conceptual in nature, there has been insufficient exploration to define a mineral resource, and it is uncertain if further exploration will result in the stockpile being delineated as a mineral resource.
The LOI provides both parties the opportunity to exchange information and maintain confidentiality as each party seeks to determine whether mutually beneficial business opportunities may exist. The LOI does not represent a change of business for either company. The LOI does not contemplate a definitive agreement between the parties. First Cobalt has engaged Canaccord Genuity Corp. as financial adviser and Cassels Brock and Blackwell LLP as legal adviser on any transactions entered into by the company.
Trent Mell, First Cobalt president and chief executive officer, commented:
"We believe CobalTech's assets in the Cobalt camp are complementary to our own and see this transaction as an opportunity to provide value to both our shareholders and those of CobalTech. The future potential from 11 additional past-producing mines as well as a milling facility could provide the pathway to early production in this region. This potential transaction is a credit to the quality assets the team at CobalTech have built."
CobalTech CEO Bruce Bragagnolo commented:
"First Cobalt has a strong vision for the future of this region, and this transaction will be beneficial to both to CobalTech shareholders and the community. We look forward to finalizing this transaction with First Cobalt in due course."
Readers are cautioned that the LOI entered into with CobalTech is non-binding and that completion of the transaction is subject to a number of conditions, including, but not limited to, completion of due diligence, negotiation of definitive agreements in respect of the transaction, receipt of any required regulatory approvals, the approval of the TSX Venture Exchange and the approval of the shareholders of CobalTech. The transaction cannot be completed until these conditions are satisfied. There can be no assurance that the transaction will be completed as proposed or at all.
About First Cobalt Corp.
First Cobalt is focused on building a diversified global portfolio of assets that are highly leveraged to the cobalt market. The company's current assets include almost 3,000 hectares and three former mines in the Cobalt camp in Ontario, Canada. Cornerstone assets include an option for the former-producing Keeley-Frontier mine, a high-grade mine that produced over 3.3 million pounds of cobalt and 19.1 million ounces of silver from 301,000 tonnes of ore, as well as a joint venture option on a fully permitted cobalt refinery in Cobalt, Ont. The company also has interests in seven prospective copper-cobalt properties covering 190 square kilometres in the Democratic Republic of the Congo, all with known surface mineralization.
Antoine Fournier, PGeo, MSc, vice-president of exploration for CobalTech, is the qualified person, as defined by National Instrument 43-101, for the technical information about CobalTech contained in this news release, and he has reviewed the technical information contained herein.