/Not for Release or Distribution in
the United States/
The Mineral Resource
and Mineral Reserve estimates relating to Fission Uranium Corp
contained in this announcement have been prepared in accordance
with National Instrument 43-101 – Standards of Disclosure for
Mineral Projects ("NI 43-101") and have not been reported in
accordance with the 2012 Joint Ore Reserves Committee's
Australasian Code for Reporting of Mineral Resources and Ore
Reserves ("JORC Code"). Refer to Fission's website at
www.fissionuranium.com or under Fission's profile on SEDAR+ at
www.sedarplus.ca for information in relation to the Mineral
Resource and Mineral Reserve estimates prepared by Fission. A
competent person has not done sufficient work to classify the
Mineral Resource or Mineral Reserve estimates in accordance with
the JORC Code and it is uncertain that following evaluation and/or
further exploration work that the estimates will be able to be
reported as a Mineral Resource or Ore Reserve in accordance with
the JORC Code. Please refer to further disclosure required by the
ASX Listing Rules together with a more detailed resource table at
the conclusion of this announcement.
|
KELOWNA,
BC, June 24, 2024 /CNW/ - Paladin Energy
Limited (ASX: PDN) (OTCQX: PALAF) ("Paladin") and Fission
Uranium Corp. (TSX: FCU) (OTCQX: FCUUF) (FSE:2FU)
("Fission") are pleased to announce they have entered into a
definitive arrangement agreement (the "Agreement"),
pursuant to which Paladin will acquire 100% of the issued and
outstanding shares of Fission ("Fission Shares") by way of a
court approved plan of arrangement under the Canada Business
Corporation Act (the "Transaction").
Transactions Highlights
- Fission shareholders will receive 0.1076 fully paid shares of
Paladin ("Paladin Shares") for each Fission share held at
the closing of the Transaction (the "Offer
Consideration").
- The Offer Consideration represents:
- an implied value of C$1.30 per Fission
Share1;
- an implied equity value of C$1,140
million2;
- a 25.8% premium to the closing price of the Fission Shares on
the TSX (C$1.03) on 21 June 2024; and
- a 30.0% premium to the 20-day Volume Weighted Average Price
("VWAP") of the Fission Shares on 21
June 20243.
- Upon completion of the Transaction, Fission shareholders will
own 24.0% of Paladin4, which will have a pro-forma
market capitalisation of approximately US$3.5 billion5.
- Paladin has applied for listing of the Paladin Shares on the
Toronto Stock Exchange ("TSX") concurrent with completion of
the Transaction, such that Fission shareholders will receive
TSX-listed Paladin Shares.
- Fission's Board of Directors, following the unanimous
recommendation by its special committee of independent directors
(the "Special Committee"), and in consultation with
Fission's financial and legal advisors, recommends that Fission
shareholders vote in favour of the Transaction.
- Cantor Fitzgerald has provided an opinion to the Special
Committee to the effect that, as of the date thereof, and based
upon and subject to the assumptions, limitations and qualifications
stated in such opinion, the Offer Consideration is fair, from a
financial point of view to the Fission shareholders. SCP
Resource Finance has provided an opinion to the Board of Directors
of Fission, stating that as of the date of such opinion, based upon
and subject to the assumptions, limitations and qualifications set
forth therein, the Offer Consideration to be received by Fission
shareholders under the Transaction is fair, from a financial point
of view, to Fission shareholders.
- Directors and members of senior management of Fission holding
0.7% of the outstanding Fission Shares have entered into voting
support arrangements with Paladin pursuant to which they have
agreed to vote their Fission Shares in favour of the
Transaction at the special meeting of shareholders to be called by
Fission to approve the Transaction (the "Fission
Meeting").
- The Transaction is targeted to close in the September 2024 quarter (subject to satisfaction
of all conditions under the Agreement).
The combination of Paladin and Fission will create a clean
energy leader and will deliver the following benefits to both
Paladin and Fission shareholders:
- Enhanced project development pipeline.
- Multi-asset production expected by 2029.
- Diversified presence across leading uranium mining
jurisdictions of Canada,
Namibia and Australia.
- Increased exposure to highly attractive long term uranium
fundamentals.
- Increased scale and global profile of Paladin with TSX
listing.
The Transaction will also deliver several direct benefits to
Fission shareholders:
- Attractive 30.0% premium to Fission's
20-Day VWAP6 and the ability to participate in the
upside of Paladin.
- Meaningful 24.0% ownership in a global, multi-asset uranium
company with exposure to the producing Langer Heinrich Mine
("LHM").
- Continued exposure to the Patterson Lake South project's
("PLS") future operational profile and exploration
upside.
- De-risk Fission's PLS development funding, underpinned by
LHM production and customer offtake contract book.
- Opportunity to retain TSX-listed shares in a leading
ASX100 growth-focused uranium company providing increased
trading liquidity and an enhanced capital markets presence.
____________________________________
|
1 Based on
the exchange ratio under the Agreement, being 0.1076 of a Paladin
Share for each Fission Share (the "Exchange Ratio")
multiplied by the closing price of the Paladin Shares on the ASX of
A$13.24 on 21 June 2024, and converted to C$12.04 using AUD/CAD
exchange rate as of 21 June 2024, being 0.91.
|
2 Based on
the closing price of the Paladin Shares on the ASX of A$13.24
on 21 June 2024 converted to C$12.04 using AUD/CAD exchange rate as
of 21 June 2024 being 0.91, and 95 million Paladin Shares issued
using Fission's 880 million fully diluted shares based on the
treasury stock method and the exchange ratio under the Agreement of
0.1076.
|
3 Based on
the 20-day VWAP of the Fission Shares on the TSX of C$1.09 and
the 20-day VWAP of the Paladin Shares on the ASX of A$14.52, and
converted to C$13.21 using the spot exchange rate AUD/CAD in effect
on each trading day.
|
4 Fully
diluted ownership based on the expected Paladin Shares issued and
outstanding immediately following completion of the
Transaction.
|
5 Based on
the expected Paladin Shares issued and outstanding immediately
following completion of the Transaction and the closing price of
the Paladin Shares on the ASX of A$13.24 on 21 June 2024,
converted to US$8.79 using the AUD/USD exchange rate as of 21 June
2024, being 0.66.
|
6 Refer to
footnote 3.
|
Paladin CEO Ian Purdy commented:
"The acquisition of Fission, along with the successful
restart of our Langer Heinrich Mine, is another step in our
strategy to diversify and grow into a global uranium leader across
the top uranium mining jurisdictions of Canada, Namibia and Australia.
Fission is a natural fit for our portfolio with the shallow
high-grade PLS project located in Canada's Athabasca Basin. The addition of PLS creates a
leading Canadian development hub alongside Paladin's Michelin
project, with exploration upside across all Canadian
properties.
Both sets of shareholders are expected to benefit from the
increased scale of the enlarged company, with a combined Mineral
Resource representing one of the largest amongst pure-play uranium
companies globally and a substantially increased international
capital markets exposure. The Transaction also de-risks the
development of PLS for Fission shareholders, underpinned by LHM
production and Paladin's leading offtake contract book. Paladin
will bring the required investment to PLS in order to advance it
towards production."
Fission President and CEO Ross
McElroy commented:
"The combination of Fission and Paladin will create a world
class diverse uranium producer, adding a class leading development
project in a Tier 1 jurisdiction with the ability to expand
production and cash flow profiles in the near term. With
commercial production at Langer Heinrich and further development
milestones at PLS, this opportunity will create a diverse pureplay
uranium company with current production and a deep pipeline of near
and mid-term assets available to investors.
The culture and assets between Fission and Paladin are very
complimentary. Shareholders will have exposure to a producing
asset with a long life of mine, located in a politically stable and
globally significant uranium jurisdiction with a long history of
uranium production, coupled with Fission's advanced stage, large,
near surface, high-grade Triple R deposit at its PLS project
located in Canada's renowned
Athabasca Basin.
This arrangement significantly de-risks the mine-building
financing at PLS, with the cash flow generation at Langer Heinrich
and a strong balance sheet creating an opportunity to significantly
fund the development of PLS through debt and internally generated
cash flows with limited further equity dilution."
Transaction Details
The Transaction will create a globally significant uranium
company listed on the ASX and TSX with a robust portfolio of
exploration, development and production assets.
Pursuant to the Agreement, Paladin will acquire all of the
issued and outstanding Fission Shares by way of a court approved
plan of arrangement under the Canada Business Corporations
Act.
Under the terms of the Agreement, each Fission Share outstanding
at the effective time of the Agreement will be exchanged for the
Offer Consideration. The Offer Consideration represents an implied
value of C$1.30 per Fission Share and
an equity value of C$1,140 million
(A$1,253 million) based on the
closing price of the Paladin Shares on the ASX of A$13.24 (C$12.04)
on 21 June 2024. The Offer
Consideration represents a 25.8% premium to the closing price of
the Fission Shares on the TSX of C$1.03 on 21 June
2024 and a 30.0% premium to the 20-day VWAP of the Fission
Shares on 21 June 2024.
Upon completion of the Transaction, existing Paladin and Fission
shareholders will own approximately 76.0% and 24.0% of the enlarged
Paladin, respectively.
Paladin has applied to list the Paladin Shares on the TSX
concurrent with closing of the Transaction. Paladin shareholder
approval is not required for the Transaction.7
The Transaction requires the approval of (i) at least
662/3% of the votes cast by Fission shareholders voting
as a single class at the Fission Meeting, (ii) at least
662/3% of the votes cast by Fission shareholders and
optionholders voting together as a single class at the Fission
Meeting, and (iii) a simple majority of the votes cast by Fission's
minority shareholders at the Fission Meeting.
The Transaction is also subject to closing conditions customary
in transactions of this nature, including receipt of Investment
Canada Act and Competition Act (Canada) clearance, British Columbia court approvals and
applicable stock exchange approvals.
The Agreement also includes customary reciprocal deal
protections, including fiduciary-out provisions, non-solicitation
covenants and a right to match any superior proposals. A
termination fee of C$40 million
(A$44 million)8 is payable
by Fission to Paladin if the Agreement is terminated in certain
circumstances.
The Transaction is targeted to be completed in the September 2024 quarter, subject to satisfaction
of all conditions under the Agreement.
Following completion of the Transaction, the Fission Shares will
be de-listed from the TSX, the OTCQX and the Frankfurt Stock
Exchange.
Full details of the Transaction will be included in a management
information circular of Fission which is expected to be mailed to
Fission shareholders in connection with the Fission Meeting on or
around 23 July 2024 (the
"Fission Circular"). Copies of the Fission Circular
and the Agreement will be available to access on SEDAR+ under
Fission's profile.
__________________________________
|
7 Paladin
has obtained in-principle confirmation from ASX that on
receipt of a formal waiver application for a waiver from Listing
Rule 7.1, it is (on the information provided) likely to grant the
requested waiver.
|
8 Converted
to A$ using the CAD/AUD exchange rate as of 21 June 2024, being
1.10.
|
Strategic Rationale
1. World-class
production and growth pipeline
- LHM recommenced production in March
2024 with a 17-year mine life and a nameplate capacity of
6Mlbs p.a. U3O8.9
- PLS hosts the shallow, high-grade Triple R deposit located in
the Athabasca Basin in
Saskatchewan, Canada.
- The PLS Feasibility Study (as defined below) highlighted
the potential for a 10-year mine life with annual production of
9.1Mlbs p.a. U3O8.10
- PLS along with the producing LHM and Paladin's Michelin project
(which is at the preliminary economic assessment stage)
("Michelin") deliver a quality growth pipeline with the
ability to grow production into a structurally tight uranium
market.
2. Creation of a
leading Canadian development hub
- Creates a new, leading Canadian development hub with two
uranium projects, PLS and Michelin.
- High quality multi-asset portfolio with exposure to
Canada's highly
prospective Athabasca Basin with exploration upside across all
properties.
3. Globally
significant uranium resource
- Combined resource representing one of the largest amongst
pure-play uranium companies with pro-forma
U3O8 Mineral Resources of 544Mlbs and Ore
Reserves of 157Mlbs.11
- Diversified uranium portfolio across conventional open-pit and
high-grade underground orebodies.
4. Enhanced
exposure to highly attractive uranium market
- Multi-asset production expected by the end of the decade
leveraged to strong future demand for nuclear energy driven by
global decarbonisation.
- Anticipated global uranium supply shortage driven by
under-investment over the last decade.
5. Increased
international capital markets presence
- Further enhances Paladin's position as the leading
ASX100-listed pure-play uranium producer.
- Increased market capitalisation and dual listing on the
TSX expected to attract a broader investor base and increased
research coverage.
- Increased access to a highly institutionalised,
international register and enhanced trading liquidity.
6. Shared
commitment to a sustainable future
- Collective focus to help drive the global energy transition to
a carbon-free, sustainable future.
- Strong Indigenous and local community engagement across all
operating regions.
- United corporate governance across environmental and social
frameworks.
- Commitment to creating lasting value in the local economy.
___________________________________
|
9 Refer to
Paladin's ASX announcement entitled 'Langer Heinrich Mine
Restart Plan Update, Mineral Resource and Ore Reserve Update'
released to the ASX on 4 November 2021 which is available on
Paladin's website www.paladinenergy.com.au. Paladin confirms that
all material assumptions underpinning the production target, or the
forecast financial information derived from a production target, in
the original market announcement continue to apply and have not
materially changed.
|
10 Refer the
technical report titled "Feasibility Study, NI 43-101 Technical
Report, for PLS Property" with an effective date of 17 January
2023 which was prepared in accordance with NI 43-101 and is
available on Fission's profile on SEDAR+ at www.sedarplus.ca. See
also the Fission ‐ Foreign Estimate Disclosures in Schedule
1.
|
11
Comprising existing Paladin JORC Mineral Resources and Ore
Reserves (refer to the Competent Person's Statement at the end of
this announcement for further information, including for cautionary
statements regarding historical estimates) and Fission NI 43‐101
Mineral Resources and Mineral Reserves (refer to the Fission ‐
Foreign Estimate Disclosures in Schedule 1 for further
information). Paladin cautions that the NI 43‐101 Mineral Resources
and Mineral Reserves for Fission are foreign estimates and are not
reported in accordance with the JORC Code. A Competent Person has
not done sufficient work to classify the NI 43‐101 Mineral
Resources as JORC Code Mineral Resources in accordance with the
JORC Code or to classify the NI 43‐101 Mineral Reserves as Ore
Reserves in accordance with the JORC Code. It is uncertain that
following evaluation and/or further exploration work that the
foreign estimates will be able to be reported as Mineral Resources
and/or Ore Reserves in accordance with the JORC Code.
|
Board of Directors' Recommendations
Fission's Board of Directors, following the unanimous
recommendation by its Special Committee, and in consultation with
Fission's financial and legal advisors, recommends that Fission
shareholders vote in favour of the Transaction.
Advisors
Paladin has engaged Macquarie Capital as financial advisor,
Fasken Martineau DuMoulin LLP as Canadian legal advisor and Corrs
Chambers Westgarth as Australian legal advisor.
Fission has engaged SCP Resource Finance as financial advisor
and Blake, Cassels & Graydon LLP as legal advisor. Fission's
Special Committee has engaged Cantor Fitzgerald as financial
advisor.
Conference Call / Presentation
Paladin will host two investor calls to accommodate shareholders
located across multiple time zones.
The first call will take place at 6:00pm Australian Eastern Standard Time on Monday
24 June 2024 / 4:00am Eastern Daylight Time on Monday
24 June 2024. To participate please
use the following link:
Phone Registration
https://s1.c-conf.com/diamondpass/10039972-jh87y6.html
Webcast
https://ccmediaframe.com/?id=QjseK9O6
The second call will take place 9:00am
Eastern Daylight Time on Monday 24
June 2024 / 11:00pm Australian
Eastern Standard Time on Monday 24 June
2024. To participate please use the following link:
Phone Registration
https://s1.c-conf.com/diamondpass/10039971-fd67hc.html
Webcast
https://ccmediaframe.com/?id=RpIYQLFb
This announcement has been authorised for release by the
Board of Directors of Paladin Energy Ltd and Fission Uranium
Corp.
About Paladin
Paladin Energy Ltd (ASX:PDN OTCQX:PALAF) is a globally
significant independent uranium producer with a 75% ownership of
the world-class long life Langer Heinrich Mine located in
Namibia. Paladin also owns a portfolio of uranium exploration
and development assets in Canada
and Australia. Paladin is
committed to a best-practice ESG framework that ensures
responsible, accountable and transparent management of the uranium
resources Paladin mines – both now and in the future. Through its
Langer Heinrich Mine, Paladin delivers reliable uranium supply to
major nuclear utilities around the world, positioning itself as a
meaningful contributor to global decarbonisation.
About Fission
Fission Uranium Corp. is an award-winning Canadian uranium
project developer and 100% owner of the Patterson Lake South
uranium property – a proposed high-grade uranium mine and mill in
Canada's Athabasca Basin region. Fission's common
shares are listed on the TSX Exchange under the symbol "FCU" and
trade on the OTCQX marketplace in the U.S. under the symbol "FCUUF"
and on the Frankfurt Stock Exchange under the symbol 2FU.
Competent Person's Statement/Scientific and Technical
Information
Langer Heinrich Mine
The information in this announcement relating to Mineral
Resource and Ore Reserve estimates for the Langer Heinrich Mine is
extracted from the ASX announcement entitled "Langer Heinrich Mine
Restart Plan Update, Mineral Resource and Ore Reserve Update"
released to the ASX on 4 November
2021 which is available on Paladin's website
www.paladinenergy.com.au. Paladin confirms that it is not aware of
any new information or data that materially affects the information
included in the original market announcement, and that all material
assumptions and technical parameters underpinning the estimates in
the original market announcement continue to apply and have not
materially changed. Paladin confirms that the form and context in
which the competent person's findings are presented have not been
materially modified from the original market announcement.
Michelin
In relation to information in this announcement relating to
Mineral Resource estimates for Michelin, please refer to the:
(1) ASX Announcement dated 31 January
2018 "Correction to 30 June
2017 Annual Report" pp13-15 (reporting standard JORC 2012)
which is available on Paladin's website www.paladinenergy.com.au;
and (2) SEDAR lodgement (TSX:FRG) dated 8
September 2009 "Fronteer Reports Positive Preliminary
Economic Assessment for Michelin Uranium Project" (reporting
standard JORC 2004). Paladin confirms that it is not aware of any
new information or data that materially affects the information
included in the original market announcement, and that all material
assumptions and technical parameters underpinning the estimates in
the original market announcement continue to apply and have not
materially changed. Paladin confirms that the form and context in
which the competent person's findings are presented have not been
materially modified from the original market announcement. To the
extent the estimates have been reported under the reporting
standard JORC 2004, they are "historical estimates" for the
purposes of the ASX Listing Rules. In relation to the historical
estimates: (1) Paladin confirms that the supporting information
provided in the original market announcement continues to apply and
has not materially changed; and (2) Paladin cautions that: the
estimates are not reported in accordance with the JORC Code; a
competent person has not done sufficient work to classify the
estimates as Mineral Resources or Ore Reserves in accordance with
the JORC Code; and it is uncertain that following evaluation and/or
further exploration work that the estimates will be able to be
reported as Mineral Resources or Ore Reserves in accordance with
the JORC Code.
Manyingee & Carley Bore and Mount Isa Projects
In relation to information in this Announcement relating to
Mineral Resources estimates for the Manyingee & Carley Bore and Mount Isa Projects, please refer
to the: (1) ASX Announcement (ASX:SMM) dated 19 October 2010
"Resource Upgrade for the Valhalla Uranium Deposit" (reporting
standard JORC 2004); (2) ASX Announcement dated 16 April 2012 "Quarterly Activities Report for
period ending 31 March 2012"
(reporting standard JORC 2004); (3) ASX Announcement dated
15 April 2011 "Quarterly Activities
Report for period ending 31 March
2011 (reporting standard JORC 2004); (4) ASX Announcement
dated 31 August 2011 "30 June 2011 Annual Report" p29 (reporting
standard JORC 2004); (5) ASX Announcement dated 17 January 2012 "Quarterly Activities Report for
period ending 31 December 2011"
(reporting standard JORC 2004); (6) ASX Announcement dated
13 July 2012 "Quarterly Activities
Report for period ending 30 June
2012" (reporting standard JORC 2004); (7) ASX Announcement
(ASX:EMX) dated 12 February 2014
"Energia Delivers Significant Uranium Resource Upgrade" (reporting
standard JORC 2012); (8) ASX Announcement dated 14 January 2014 "Manyingee Minerals Resources –
Amendment" (reporting standard JORC 2012); (9) ASX Announcement
dated 10 December 2008 "Maiden
Uranium Resource at Valhalla North Project" (reporting standard
JORC 2004); (10) Mirrioola – ASX Announcement dated 15 March 2012 "Half Yearly Financial Report
31 December 2011" (reporting standard
JORC 2004); (11) Watta – ASX Announcement Summit Resources Ltd
dated 29 January 2013 "Half Year
Financial Report – 31 December 2012
(reporting standard JORC 2004); and (12) Warwai – ASX Announcement
Summit Resources Ltd dated 29 January
2013 "Half Year Financial Report – 31
December 2012 (reporting standard JORC 2004). Paladin
confirms that it is not aware of any new information or data that
materially affects the information included in the original market
announcement, and that all material assumptions and technical
parameters underpinning the estimates in the original market
announcement continue to apply and have not materially changed.
Paladin confirms that the form and context in which the competent
person's findings are presented have not been materially modified
from the original market announcement. To the extent the estimates
have been reported under the reporting standard JORC 2004, they are
"historical estimates" for the purposes of the ASX Listing Rules.
In relation to the historical estimates: (1) Paladin confirms that
the supporting information provided in the original market
announcement continues to apply and has not materially changed; and
(2) Paladin cautions that: the estimates are not reported in
accordance with the JORC Code; a competent person has not done
sufficient work to classify the estimates as Mineral Resources or
Ore Reserves in accordance with the JORC Code; and it is uncertain
that following evaluation and/or further exploration work that the
estimates will be able to be reported as Mineral Resources or ore
reserves in accordance with the JORC Code.
Patterson Lake South
The information in this announcement relating to Mineral
Reserves and Mineral Resources estimates for PLS is based on the
technical report titled "Feasibility Study, NI 43-101 Technical
Report, for PLS Property" with an effective date of 17 January 2023 (the "PLS Feasibility
Study") which was prepared in accordance with NI 43-101 and is
available on www.sedarplus.ca. The PLS Feasibility Study (including
life of Mine Plan and cash flow) is
based upon geological, engineering, technical and cost inputs
developed by Tetra Tech and other study participants. The technical
information for the PLS Feasibility Study has been prepared in
accordance with the Canadian regulatory requirements set out in NI
43-101 and reviewed and approved by Hassan
Ghaffari, P.Eng., Dr. Jianhui (John)
Huang, P.Eng., Patrick
Donlon, FSAIMM, FAusIMM, and Dr. Sabry Abdel Hafez, P.Eng., of Tetra Tech,
Mark Mathisen, C.P.G., of SLR
Consulting (Canada) Ltd.,
Catherine Schmid, P.Eng. and
Randi Thompson, P.Eng., of BGC
Engineering Inc., Maurice Mostert,
P.Eng., of Mining Plus Canada Consulting Ltd., and Wayne Clifton, P.Eng. and Mark Wittrup, P.Eng., P.Geo., of Clifton
Engineering Group Ltd., each of whom is a "qualified person" under
NI 43-101.
The technical information in this news release has been prepared
in accordance with the Canadian regulatory requirements set out in
NI 43-101 and reviewed on behalf of the company by Ross McElroy, P.Geo., President and CEO of
Fission, a "qualified person" under NI 43-101.
Disclaimers
Not for Release or Distribution
in the United
States
This announcement may not be released to US wire services. This
announcement does not constitute an offer to sell, or the
solicitation of an offer to buy, any securities in the United States or any other jurisdiction in
which such an offer would be unlawful. The Paladin Shares have not
been, and will not be, registered under the US Securities Act of
1933 and may not be offered or sold in the United States except in transactions
exempt from, or not subject to, the registration requirements of
the US Securities Act and applicable US state securities laws. This
Announcement must not be disclosed to any other party and does not
carry any right of publication. Neither this Announcement nor any
of its contents may be reproduced or used for any purpose without
the prior written consent of Paladin and Fission.
Limitation on Information Regarding
Paladin and Fission
All information in this announcement and in the investor
presentation released on the ASX platform today ("Investor
Presentation") in relation to Fission and PLS – including in
relation to the estimates of Mineral Resources and Mineral Reserves
and other technical and financial information (such as historic
costs and life of mine plans) - has been sourced from, prepared
for, or provided by Fission and its related bodies corporate.
Whilst Paladin has undertaken due diligence in order to seek to
verify the accuracy of this information, no representation or
warranty, expressed or implied, is made as to the fairness,
accuracy, correctness, completeness or adequacy of any such
information relating to Fission or PLS.
All information in this announcement and in the Investor
Presentation in relation to Paladin and LHM including in relation
to the estimates of Mineral Resources and Ore Reserves and other
technical and financial information (such as historic costs and
life of mine plans) - has been sourced from, prepared for, or
provided by Paladin and its related bodies corporate. Whilst
Fission has undertaken due diligence in order to seek to verify the
accuracy of this information, no representation or warranty,
expressed or implied, is made as to the fairness, accuracy,
correctness, completeness or adequacy of any such information
relating to Paladin or LHM.
Not Financial Advice
This announcement is not financial product, investment advice or
a recommendation to acquire securities of Paladin or Fission and
has been prepared without taking into account the objectives,
financial situation or needs of individuals. Each recipient of this
announcement should make its own enquiries and investigations
regarding all information in this announcement and in the Investor
Presentation, including, but not limited to, the assumption,
uncertainty and contingencies which may affect future operations of
Paladin and/or Fission and the impact that different future
outcomes may have on Paladin and/or Fission. Before making an
investment decision, prospective investors should consider the
appropriateness of the information having regard to their own
objectives, financial situation and needs, and seek legal, taxation
and financial advice appropriate to their jurisdiction and
circumstances.
Cautionary Note Regarding Forward
Looking Statements
This announcement contains certain "forward looking statements"
within the meaning of Australian securities laws and "forward
looking information" within the meaning of Canadian securities laws
(collectively referred to as "forward looking statements"). All
statements, other than statements of historical fact, that address
circumstances, events, activities or developments that could, or
may or will occur are forward looking statements. Forward looking
statements involve subjective judgment and analysis and are subject
to significant uncertainties, risks and contingencies including
those risk factors associated with the mining industry, many of
which are outside the control of, change without notice, and may be
unknown to Paladin or Fission. These risks and uncertainties
include but are not limited to liabilities inherent in mine
development and production, geological, mining and processing
technical problems, the inability to obtain any additional mine
licences, permits and other regulatory approvals required in
connection with mining and third party processing operations,
competition for amongst other things, capital, acquisition of
reserves, undeveloped lands and skilled personnel, incorrect
assessments of the value of acquisitions, changes in commodity
prices and exchange rates, currency and interest fluctuations,
various events which could disrupt operations and/or the
transportation of mineral products, including labour stoppages and
severe weather conditions, the demand for and availability of
transportation services, the ability to secure adequate financing
and management's ability to anticipate and manage the foregoing
factors and risks.
Forward looking statements in this announcement include, but are
not limited to, statements regarding: the expected timetable,
outcome and effects of the Transaction; the listing of the Paladin
Shares on the TSX, the anticipated benefits of the Transaction to
Paladin's and Fission's shareholders; the prospects and outcomes of
PLS and LHM; the ability of Paladin and Fission to complete the
Transaction on the terms described herein or at all; the plans and
strategies of Paladin or Fission; the future performance of Paladin
or Fission; the ability to obtain the requisite regulatory, stock
exchange, court and shareholder approvals for the Transaction; and
statements about market and industry trends, which are based on
interpretation of market conditions. Forward looking statements can
generally be identified by the use of forward looking words such as
"anticipate", "expect", "likely", "propose", "will", "intend",
"should", "could", "may", "believe", "forecast", "estimate",
"target", "outlook", "guidance" (including negative or grammatical
variations) and other similar expressions. No representation,
warranty, guarantee or assurance, express or implied, is given or
made in relation to any forward looking statement. In particular no
representation, warranty or assumption, express or implied, is
given in relation to any underlying assumption or that any forward
looking statement will be achieved. There can be no assurance that
the forward looking statements will prove to be accurate. Actual
and future events may vary materially from the forward looking
statements and the assumptions on which the forward looking
statements were based, because events and actual circumstances
frequently do not occur as forecast and future results are subject
to known and unknown risks such as changes in market conditions and
regulations.
Given these uncertainties, readers are cautioned not to place
undue reliance on such forward looking statements, and should rely
on their own independent enquiries, investigations and advice
regarding information contained in this announcement. Any reliance
by a reader on the information contained in this announcement is
wholly at the reader's own risk.
To the maximum extent permitted by law or any relevant listing
rules of the ASX/TSX, Paladin and Fission and their respective
related bodies corporate and affiliates and their respective
directors, officers, employees, advisors, agents and intermediaries
disclaim any obligation or undertaking to disseminate any updates
or revisions to the information in this announcement to reflect any
change in expectations in relation to any forward looking
statements or any such change in events, conditions or
circumstances on which any such statements were based. Nothing in
this announcement will, under any circumstances (including by
reason of this announcement remaining available and not being
superseded or replaced by any other announcement or publication
with respect to Paladin, Fission or the subject matter of this
announcement), create an implication that there has been no change
in the affairs of Paladin or Fission since the date of this
announcement.
Schedule 1 – Fission – Foreign Estimate Disclosures (as
required by ASX Listing Rule 5.12)
The Mineral Resources for Fission, which includes an Indicated
Mineral Resource of 114.9 million pounds at a grade of 1.94% in 2.7
million tonnes and an Inferred of 15.4 million pounds at a grade of
1.10% in 0.6 million tonnes at a cut-off of 0.25%, are estimated at
17 January 2023, inclusive of the
Mineral Reserves. The Mineral Reserves for Fission as at
17 January 2023 are estimated at 93.7
million pounds.12
The information in this announcement relating to Fission's
Mineral Resources and Mineral Reserves is reported in accordance
with the requirements applying to foreign estimates in the ASX
Listing Rules and, as such, are not reported in accordance with the
JORC Code.
A Competent Person has not yet completed sufficient work to
classify the Mineral Resources as JORC Code Mineral Resources or to
classify the Mineral Reserves as Ore Reserves in accordance with
the JORC Code 2012.
It is uncertain that following evaluation and/or further
exploration work that the Mineral Resources or Mineral Reserves
will be able to be reported as Mineral Resources or Ore Reserves in
accordance with the JORC Code.
The information in this announcement relating to Mineral Reserve
and Mineral Resource for PLS is based on the technical report
titled "Feasibility Study, NI 43-101 Technical Report, for PLS
Property" with an effective date of 17
January 2023 which was prepared in accordance with NI
43-101.
The Mineral Reserves and Mineral Resources estimates for Fission
are not, and do not purport to be, compliant with the JORC Code and
are therefore classified as "foreign estimates" under the ASX
Listing Rules.
Mineral Resources Statement13
Category
|
Tonnage
|
Metal
Grade
|
Contained
Metal
|
(000
t)
|
(%
U3O8)
|
(g/t
Au)
|
(Mlbs
U3O8)
|
(000 oz
Au)
|
Indicated
|
2,688
|
1.94
|
0.61
|
114.9
|
52.7
|
Inferred
|
635
|
1.10
|
0.44
|
15.4
|
9.0
|
Notes:
|
|
1.
|
CIM (2014) definitions
were followed for Mineral Resources.
|
2.
|
Mineral Resources are
reported at a cut-off grade of 0.25% U3O8, based on a long-term
price of US$50/lb U3O8, an exchange rate of C$1.00/US$0.75, and
cost estimates derived during the PFS with a metallurgical recovery
of 95%.
|
3.
|
A minimum mining width
of 1 m was applied to the resource domain wireframe.
|
4.
|
Mineral Resources are
inclusive of Mineral Reserves.
|
5.
|
Numbers may not add due
to rounding.
|
Mineral Reserve Statement13
Category
|
Tonnage
|
Metal
Grade
|
Contained
Metal
|
(000
t)
|
(%
U3O8)
|
(Mlbs
U3O8)
|
Probable
|
3,007
|
1.41
|
93.7
|
Total
|
3,007
|
1.41
|
93.7
|
Notes:
|
|
1.
|
CIM Definition
Standards (2014) were followed for the classification of Mineral
Reserves.
|
2.
|
The Mineral Reserves
are reported with an effective date of January 17, 2023.
|
3.
|
Mineral Reserves were
estimated using a long-term metal price of US$65 per pound of U3O8
and a US$/C$ exchange rate of 0.75 (C$1.00 = US$0.75)
|
4.
|
Underground Mineral
Reserves were estimated by creating stope shapes using Datamine's
Mineable Shape Optimizer (MSO). The MSO outputs were evaluated in
the context of the mine design, and then a 0.25% U3O8 cut-off was
applied. For longhole stoping, a minimum mining width of 4m
(including hanging wall and footwall dilution) and stope height of
20m was used. Following MSO, the mineable shapes were further
subdivided in Deswik to produce a maximum width of 12m (including
hanging wall and footwall dilution). Drift and fill mining is
designed at 5m wide by 5m high for development shapes located in
the crown pillar areas of the orebodies.
|
5.
|
Mining recovery of 95%
was applied to all stopes, while all development mining assumes
100% extraction.
|
6.
|
The density varies
based on block model values. An estimated waste density of 2.42
t/m3 was used for areas outside the block model
boundary.
|
7.
|
By-product credits were
not included in the estimation of Mineral Reserves.
|
8.
|
Numbers may not add due
to rounding.
|
ASX Listing Rule 5.12 requires specific information to be included
in a public announcement that contains a foreign estimate. In
accordance with ASX Listing Rule 5.12, Paladin provides the
additional information below and the information elsewhere in this
announcement.
____________________________________
|
12 Refer to
the cautionary statement in relation to ASX Listing Rule
5.12.9 in the table below.
|
13 Mineral
Reserves and Mineral Resources estimates for PLS is based on
the technical report titled "Feasibility Study, NI 43-101 Technical
Report, for PLS Property" with an effective date of 17 January 2023
which was prepared in accordance with NI 43-101 and is available on
www.sedarplus.ca.
|
Competent Person's Statement:
Henry Kim, P.Geo. confirms that
the information in this market announcement that relates to
Fission's Mineral Resources provided under ASX Listing Rules 5.12.2
to 5.12.7 is an accurate representation of the available data and
studies supplied to Paladin as a foreign estimate. Henry Kim is a full-time employee of Wood Canada
Limited and is a member of Engineers and Geoscientists British
Columbia. Henry Kim has sufficient
experience that is relevant to the style of mineralisation and
types of deposits under consideration and to the activity which he
has undertaken to qualify as a Competent Person as defined in the
2012 Edition of the Australasian Code for the Reporting of
Exploration Results, Mineral Resources and Ore Reserves.
Henry Kim consents to the inclusion
in this announcement of the matters related to the Fission Mineral
Resources based on this information in the form and context in
which it appears.
William Bagnell, P.Eng. confirms
that the information in this market announcement that relates to
Fission's Mineral Reserves provided under ASX Listing Rules 5.12.2
to 5.12.7 is an accurate representation of the available data and
studies supplied to Paladin as a foreign estimate. William Bagnell is a full-time employee of Wood
Canada Limited and is a Professional Licensee Engineering with
Association of Engineers and Geoscientists Saskatchewan.
William Bagnell has sufficient
experience that is relevant to the style of mineralisation and
types of deposits under consideration and to the activity which he
has undertaken to qualify as a Competent Person as defined in the
2012 Edition of the Australasian Code for the Reporting of
Exploration Results, Mineral Resources and Ore Reserves.
William Bagnell consents to the
inclusion in this announcement of the matters related to Fission's
Mineral Reserves based on this information in the form and context
in which it appears.
ASX Listing
Rule
|
ASX
Explanation
|
Commentary
|
5.12.1
|
The source and date of
the historical estimates or foreign estimates
|
The PLS Mineral
Resource and Mineral Reserve estimates were prepared under the
supervision of Qualified Persons (as defined in the Canadian NI
43-101 Standards). The Qualified Persons were employees and
consultants of Fission at the date of the estimate 17 May 2022. The
Canadian NI 43-101 Standard is a national instrument for the
Standards of Disclosure for Mineral Projects within
Canada.
The source of the
foreign estimate is the Fission's TSX announcement entitled
"Feasibility Study, NI 43-101 Technical Report, for PLS Property"
dated 17 January 2023, which sets out the foreign estimate of
Mineral Resources and Mineral Reserves of PLS with an effective
date of 17 May 2022.
These foreign estimates
are the most recent Mineral Reserve and Mineral Resource estimates
for PLS.
|
5.12.2
|
Whether the historical
estimates or foreign estimates use categories of mineralisation
other than those defined in Appendix 5A (JORC Code) and if so, an
explanation of the differences
|
The PLS foreign
estimate of Mineral Resources and Mineral Reserves has been
prepared using the Canadian NI 43-101 reporting guidelines. Based
on the advice received from its external consultants, Paladin
believes that the categories of mineralisation reported under
Canadian NI 43-101 Standards are similar to the JORC Code 2012
categories.
Based on the advice
received from its external consultants, Paladin considers the
foreign estimate to be NI 43-101 compliant.
Based on the advice
received from its external consultants, Paladin considers that the
foreign estimates provided by Fission are sufficiently reliable and
consistent with current industry standard estimation methodologies
as generally appropriate for Mineral Resource and Ore Reserve
estimation.
The Mineral Resource
estimate contains categories of NI 43-101 'Measured', 'Indicated'
and 'Inferred', that are consistent with the terminology of the
Measured', 'Indicated' and 'Inferred' under the JORC Code
2012. NI 43-101 Mineral Reserves are reported as Proven and
Probable in the foreign estimate. These classifications are
consistent with definitions of Proved and Probable Ore Reserves in
the JORC Code 2012.
|
5.12.3
|
The relevance and
materiality of the historical estimates or foreign estimates to the
entity
|
Paladin considers these
foreign estimates to be material to Paladin given its intention,
through the Transaction, to develop the PLS property.
|
5.12.4
|
The reliability of
historical estimates or foreign estimates, including by reference
to any of the criteria in Table 1 of Appendix 5A (JORC Code) which
are relevant to understanding the reliability of the historical
estimates or foreign estimates
|
The foreign estimate is
considered to be reliable by Paladin for the following
reasons:
•
Key criteria, as defined in Table 1 of
the JORC Code 2012, has been addressed in the comprehensive due
diligence completed by Paladin and its external
consultants.
•
The foreign estimate has been reported by
Qualified Persons as defined in the Canadian NI 43-101 Standard,
who reported that the 17 January 2023 Technical Report meets
the due diligence and care requirements as set for in the
guidelines for Canadian National Instrument 43-101.
•
Within the 17 January
2023 Technical Report it is stated that the methodology for
preparing the Mineral Resources and Mineral Reserves have not
changed significantly in comparison to previous
reporting.
Based on the
information received by Paladin and its external consultants to
date in relation to PLS, discussions with Fission technical
personnel, physical inspection of site operations and site layout,
Paladin believes (based on the advice received from its
external consultants) that the assumptions, parameters and
methodology are generally appropriate for Mineral Resource and
Mineral Reserve estimates and are consistent with the style of
mineralisation and proposed mining methods, and that sampling
protocols are consistent with industry best practice.
|
5.12.5
|
To the extent known, a
summary of work programs on which the historical estimates or
foreign estimates are based and a summary of the key assumptions,
mining and processing parameters and methods used to prepare the
historical or foreign estimates
|
There are 844 drill
holes totalling 227,775m of drilling within the PLS property. The
Mineral Resource estimation is based on 696 drill holes, totalling
213,699m of drillings with 114,561 U3O8 assay
samples. Block grades are estimated with inverse distance cubed
(ID3) within the mineralization grade shell wireframes
that represent the basement hosted, structure-controlled uranium
mineralization characteristics identified in the
property.
The Mineral Resources
are reported at a cut-off grade of 0.25%
U3O8, based on a long-term price of US$50/lb
U3O8. Indicated Mineral Resources are defined
for the blocks that are located within the grade shells where the
drilling sections are spaced 15m apart along strike, show
mineralization continuity by two or more drill holes, and closest
sample is located within 15 metres.
Mineral reserves are
based on the resource model developed from the 844 drill holes that
total 227,775 m on the PLS property. Modifying factors of
mine recovery (95% to 100% ) and dilution (from 5% to 18%) were
applied to the resource model. The mining methods reviewed
for the recovery for the deposit are reasonable given the geometry
and depth of the deposit. A nominal production rate of 1000
tonnes per day has been applied to the deposit. A mine cost model
was developed based on the proposed mine plan to support the
project capex and operating costs.
A series of bench scale
and bulk tests were conducted at SGS Canada Inc. – Mineral
Services (SGS) Lakefield to support the feasibility level design of
the process plant.
The design for the
process plant and related infrastructure facilities for PLS
use proven uranium extraction technology, processes and equipment
and draws on the knowledge of other Athabasca uranium plants,
including Rabbit Lake, Key Lake, and McClean Lake.
The processing plant
has been designed to process ore at a nominal throughput of
1,000 t/d to produce market-grade uranium concentrate. The
average life of mine (LOM) mill feed grade is estimated to be 1.41%
U3O8, and the estimated overall
U3O8 recovery will be 97.0%.
|
5.12.6
|
Any more recent
estimates or data relevant to the reported mineralisation available
to the entity
|
As at the date of this
announcement, the foreign estimates reported by Fission have not
been superseded by any later estimates. No more recent estimates
have been completed or provided to Paladin by Fission.
|
5.12.7
|
The evaluation and/or
exploration work that needs to be completed to verify the
historical estimates or foreign estimates as Mineral Resources or
Ore Reserves in accordance with ASX Listing Rules Appendix 5A (JORC
Code)
|
Following completion of
the Transaction, it is Paladin's intention to undertake an
evaluation of the data available to seek to verify the foreign
estimate as Mineral Resources or Ore Reserves in accordance with
the JORC Code. This evaluation will involve the full verification
of all information and applicable modifying factors used in
the 17 January
2023 estimation together with
the addition of information and results from ongoing drilling
programs within PLS project area. External consultants will be used
as required.
Key works proposed to
verify the foreign estimate as estimates in accordance with the
JORC Code 2012 includes:
•
Detailed verification and validation of
information provided by Fission.
Review of modifying
factors used in the Mineral Resource and Mineral
Reserve.
|
5.12.8
|
The proposed timing of
any evaluation and/or exploration work that the entity intends to
undertake and a comment on how the entity intends to fund that
work
|
Paladin intends to
conduct further resource definition and regional exploration work
at PLS. This work is expected to commence in 2025 or as soon as
practicable after completion of the Transaction and will be funded
from available cash balances.
|
5.12.9
|
A cautionary statement
proximate to, and with equal prominence as, the reported historical
estimates or foreign estimates stating that:
•
the estimates are historical estimates or
foreign estimates and are not reported in accordance with the JORC
Code;
• a Competent Person has not done sufficient work to
classify the historical estimates or foreign estimates as Mineral
Resources or Ore Reserves in accordance with the JORC Code;
and
• it is uncertain that following evaluation and/or
further exploration work that the historical estimates or foreign
estimates will be able to be reported as Mineral Resources or Ore
Reserves in accordance with the JORC Code
|
Paladin cautions that
the Mineral Resources and Mineral Reserves for Fission are not
reported in accordance with the JORC Code 2012.
A Competent Person has
not yet completed sufficient work to classify the Mineral Resources
as JORC Code Mineral Resources or to classify the Mineral Reserves
as Ore Reserves in accordance with the JORC Code 2012.
It is uncertain that
following evaluation and/or further exploration work that the
Mineral Resources or Mineral Reserves will be able to be reported
as Mineral Resource or Ore Reserves in accordance with the JORC
Code.
Nothing has come to the
attention of Paladin that causes it to question the accuracy or
reliability of Fission's estimates of NI 43-101 Mineral Resources
and Mineral Reserves, but Paladin has not independently validated
those estimates and therefore Paladin is not to be regarded as
reporting, adopting or endorsing those estimates.
|
5.12.10
|
A statement by a named
competent person or persons that the information in the market
announcement provided under rules 5.12.2 to 5.12.7 is an accurate
representation of the available data and studies for the material
mining project. The statement must include the information referred
to in rule 5.22(b) and (c)
|
See Competent Person's
statement above.
|
SOURCE Fission Uranium Corp.