VANCOUVER, Aug. 27, 2019 /CNW/ - Blue Moon Zinc
Corp. (TSX.V: MOON; OTC: BMOOF) ("Blue Moon"
or the "Company") announces the signing of a strategic
joint venture (the "Transaction") where Platina Resources Inc.
(ASX: PGM) ("Platina") can earn a 70% interest in the Blue Moon
polymetallic zinc-gold-copper-silver project in the United States.
Highlights of the Transaction
- Platina will participate in a $300,000 private placement in the Company's
common shares at $0.05 per share or a
100% premium to the last trading price on the TSX Venture
Exchange ("Private Placement").
- Platina can earn an initial 50% interest ("Stage 1") in the
Blue Moon property by spending $3.0
million within eighteen months which will include a minimum
of 10,000 metres of drilling and metallurgical test work.
- Platina is required to pay the Company $250,000 in cash or Platina shares prior to
completion of Stage 1, at the Company's sole option.
- Upon Platina earning its initial 50% interest in Stage 1,
Platina has 30 days in which to elect to earn an additional 20%
interest ("Stage 2") in the Blue Moon property by spending
$3.75 million within eighteen months
which will include the completion of a pre-feasibility study as
well as continued drilling, metallurgical test work and
environmental and permitting.
- Platina is required to pay the Company $500,000 in cash or Platina shares prior to
completion of Stage 2, at the Company's sole option.
- Upon Platina earning its 70% interest in the Blue Moon
property, the Company has 20 business days to elect for Platina to
fund the next $5.0 million in
expenditures, including the Company's share of funding (the
"Platina Loan").
"We are very pleased to have Platina as our partner and to
see the continued development and expansion of the Blue Moon
project. The Joint Venture allows the Company to significantly
advance the project without material dilution to current
shareholders. Under the terms of the joint venture, Platina may
contribute up to CAD$11.75 million in
earn-in obligations and funding to the Blue Moon project in
addition to direct cash payments to the Company of up to
CAD$750,000. In addition, Platina is
participating in a CAD $300,000
private placement in the Company at a 100% premium to the last
closing price of the Company's common shares," said
Patrick McGrath, Blue Moon's Chief
Executive Officer. "As we partner with Platina to advance
the Blue Moon Project, we will continue to look for opportunities
to further add value to the Company for our shareholders.
Today's announcement is positive for our shareholders and provides
the stepping stone and capital to assist in creating long term
value."
Highlights of Blue Moon Polymetallic Project:
- Project Upside: Drill-ready brownfield project with
significant work performed and potential re-rating as it moves
along value curve by completing drilling and evaluation
studies.
- Large, well-defined Mineral Resource: The Blue Moon
Mineral Resource is a high-grade, zinc-copper rich massive sulphide
deposit with significant gold and silver precious metal credits.
The mineralisation remains open to surface, depth and along
strike.
- Attractive grades: A 2018 drilling program intersected
some of the highest grades ever intersected on the project,
including drill hole BMZ-78 which results were released by the
Company on January 18, 2019 (Click
here).
- Drill ready: A planned 10,000 metre infill and expansion
drilling program is ready to proceed. The drill program will
initially target extensions of drill hole BMZ-78 followed by
further infill and resource expansion drilling.
- Right commodities, right time: The Blue Moon project
will provide investors with exposure to a commodity suite that have
attractive supply and demand fundamentals.
- Favourable location: Located 150 kilometers from an
export port facility and one kilometer from power sourced from
hydroelectric generation. The project will benefit from low
corporates tax rates and minimal royalties.
Next Steps for Blue Moon Project
Platina's strategy is focused on expanding the size of the
Mineral Resource and exploring the broader land package for new
mineralisation. In parallel, Platina will complete metallurgical
testing and evaluation studies, environmental studies, permitting,
identifying strategic offtake partners, and advance the project
towards development.
Platina Managing Director, Corey
Nolan, commented, "The Blue Moon project
represents an exciting new opportunity to build a significant
resource in an attractive commodity suite. This deal will create
significant share value-uplift potential for Platina shareholders
as the project is advanced towards development. The first step
involves a significant drilling program to expand the size of the
deposit. Drill core will be used for metallurgical testing and data
for completion of a Pre-Feasibility Study. Platina believes
the Blue Moon project will generate significant news flow as it
advances through exploration, feasibility, permitting and into
development."
Blue Moon Polymetallic Project Development Strategy
Platina's strategy is to advance Blue Moon in a staged approach,
including the following:
- Infill and resource expansion drilling. A fully permitted
drilling program is currently being planned by Platina;
- Exploring for extensions to the existing Mineral Resource and
other potential mineralisation within the tenement package;
- Consolidating other potential resources/mineralisation in the
district;
- Completion of an Environmental Impact Statement and associated
permitting activities;
- Metallurgical test work to define the optimal process flow
sheet;
- Completion of technical studies including Pre-feasibility and
Definitive Feasibility Studies;
- Negotiating production off-take agreements; and
- Sourcing development finance and constructing the project.
Private Placement
Platina will participate in a $300,000 private placement in the Company's
common shares at $0.05 per share or a
100% premium to the last trading prince on the TSX Venture Exchange
("Private Placement"). In addition to the Private Placement,
Platina has an option to participate in a further private placement
of the Company to increase its equity interest in the Company to a
maximum 10%. This option expires on January
31, 2020 and the financing price will be based on the market
price of the Company's common shares, but no less than $0.05 per share. Upon Platina obtaining 10% of
the Company's total equity, Platina will have certain rights
including the ability to nominate one board member and have a right
to participate in future financings to maintain its 10% equity
interest, subject to certain conditions.
The private placement and joint venture are subject to TSX
Venture Exchange approval, and proceeds of the private placement
will be used for general corporate purposes.
About Blue Moon
Blue Moon (TSX.V: MOON; OTC: BMOOF) is currently advancing its
Blue Moon polymetallic deposit which contains zinc, gold, copper
and silver. The deposit is open at depth and along strike.
The Blue Moon 43-101 Mineral Resource includes 7.8 million
inferred tons at 8.07% zinc equivalent, which includes 771 million
pounds of 4.95% zinc, 300,000 ounces of gold at 0.04 oz/t, 71
million pounds of 0.46% copper, and 10 million ounces of silver at
1.33 oz/t. The 43-101 was filed on www.sedar.com on
November 20, 2018. The Company
also holds 100% of the Yava polymetallic project in Nunavut that is on strike to Glencore's
Hackett River deposit. More
information is available on the company's web site
(www.bluemoonmining.com).
Qualified Persons
Jack McClintock, P. Eng, a
Director of the Company, is a qualified person as defined by NI
43-101, has reviewed the scientific and technical information that
forms the basis for this press release.
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. Resource estimates included in this news
release are forward-looking statements. Although the Company
believes the expectations expressed in such forward-looking
statements are based on reasonable assumptions set forth in the
relevant technical report and otherwise, such statements are not
guarantees of future performance and actual results or developments
may differ materially from those in the forward-looking statements.
Factors that could cause actual results to differ materially from
those in forward-looking statements include market prices for zinc,
the closing of the Private Placement and Joint Venture, the results
of future exploration, uncertainties related to the ability to
obtain necessary permits, licenses and titles, changes in
government policies regarding mining, continued availability of
capital and financing, and general economic, market or business
conditions. Investors are cautioned that any such statements are
not guarantees of future performance and actual results or
developments may differ materially from those projected in the
forward-looking statements. Readers are cautioned not to place
undue reliance on this forward-looking information, which is given
as of the date it is expressed in this press release, and the
Company undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
applicable securities laws.
The securities referenced in this news release have not and
will not be registered under the U.S. Securities Act of 1933 and
may not be offered or sold in the United
States absent registration or an applicable exemption from
registration requirements.
SOURCE Blue Moon Zinc Corp.