Little Deer 50% goes to RamblerMay be better for THR as dilution both for acquisition and restart of feasibility study may be worse than trying to hold on to our 50%.
At least Rambler has a producing mine.
Rambler Metals to acquire Cornerstone's 50% of Little Deer
2013-09-17 09:12 ET - News Release
Mr. George Ogilvie reports
RAMBLER ENTERS CONDITIONAL AGREEMENT TO PURCHASE CORNERSTONE'S 50% INTEREST IN THE LITTLE DEER COPPER PROJECT
A conditional offer has been accepted by Cornerstone Capital Resources Inc., whereby Rambler Metals and Mining PLC, through its 100-per-cent-owned subsidiary Rambler Metals and Mining Canada Ltd., will purchase its 50-per-cent participating interest in the Little Deer copper deposit and Whalesback mine (together, the Little Deer project).
The 50 per cent interest is subject to a Joint Venture Agreement dated 20 April 2007 with Thundermin Resources Inc. (TSX:THR) ('Thundermin'). Rambler's offer is still subject to completion by the Company of a full due diligence review and negotiation and agreement on the final terms and conditions.
The purchase price for Cornerstone's interest is CAD$550,000, consisting of CAD$200,000 in cash and CAD$350,000 in common shares of Rambler to be issued on closing.
In addition, the purchase price consists of a 0.75 per cent net smelter return (NSR) on Cornerstone's proportionate share of all products subject to a buyback of 0.5 per cent of the NSR for CAD$500,000 at anytime; and the remaining 0.25 per cent of the NSR for fair market value as determined by the economics of the projects feasibility study, at any time, following the completion of the feasibility study.
The Little Deer Project is located less than 140 kilometres from the Company's Nugget Pond base and precious metals processing facility and only 30 kilometres from the Goodyear's Cove Port Facility.
George Ogilvie, President and CEO, commented:
"The Little Deer Project resembles our own producing Ming Mine just five years ago. These mines were once profitable copper mines, like Ming, that closed and have remained dormant until now, despite having significant mineralization still in the ground.
"We believe, based on our experience of successfully bringing the Ming Mine back into commercial production, we have the capability and expertise to resurrect the Little Deer and Whalesback Mines, if viable. The mines are also in close proximity to our port facility at Goodyear's Cove which could allow for bulk shipping the material into our Nugget Pond Processing Facility, thus minimizing both future capital and operating costs.
"This acquisition is another strong indicator to our shareholders, and the market in general, of our vision to be Atlantic Canada's leading mine operator and resource developer."
The expected closing date for the transaction will be on or before 14 November 2013. A further announcement will be made in due course. Following closing information on the project and future work programs will be available on the Company's website at www.ramblermines.com.
ABOUT LITTLE DEER & WHALESBACK
The Little Deer copper project, located in north-central Newfoundland, is a 50-50 joint venture with Thundermin, the project operator. Since 2007 approximately CAD$8 million has been invested into the property including 55,000 metres of diamond drilling, scoping level metallurgical test work, NI43-101 mineral resource estimates and a Preliminary Economic Assessment ("PEA").
The project includes the past-producing Little Deer and Whalesback underground copper mines which operated during the 1960's and 1970's. Cornerstone's press release, dated 26 July 2012, outlined a NI43-101 resource estimate for Little Deer and Whalesback containing combined Indicated Resources of 2,708,000 tonnes grading 2.16 per cent copper (129.1 million pounds of copper) and Inferred Resources of 4,191,000 tonnes grading 2.07 per cent copper (191.3 million pounds of copper). While Thundermin and Cornerstone have completed a NI43-101 technical report on the property, a qualified person from Rambler Metals and Mining has not done sufficient work to classify the work as current mineral resources or mineral reserves; as such the Company is not treating the historical estimate as current mineral resources or mineral reserves. Further review of the previous work will be completed following the closing of the agreement.
A PEA completed in November 2011 by P&E Mining Consultants Inc. on the Little Deer deposit, on a stand-alone basis, demonstrated the technical and economic viability of developing a new underground copper mine at Little Deer. Planned future work consists of infill diamond drilling to upgrade any Inferred Resources to an Indicated or Measured Resource category in order to further advance the project's engineering studies. Good opportunities also exist to expand the mineral resources at both deposits. The Company has not verified the results of the PEA.
Larry Pilgrim, P.Geo., is the Qualified Person responsible for the technical content of this release and has reviewed and approved it accordingly. Mr. Pilgrim is an independent consultant contracted by Rambler Metals and Mining Canada Limited.
We seek Safe Harbor.
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