News
Azincourt enters option deal to acquire Snegamook
2024-10-29 16:53 ET - News Release
Mr. Alex Klenman reports
AZINCOURT ENERGY OPTIONS ADVANCED URANIUM PROJECT IN LABRADOR
Azincourt Energy Corp. has entered into a definitive property option agreement with BR Corp. Pty. Ltd. (the optionor), an arm's-length party, pursuant to which it has been granted the option to acquire up to a 100-per-cent interest in and to a mineral claim block located in the province of Newfoundland and Labrador, commonly known as the Snegamook project.
The project is strategically located to the southeast of Snegamook Lake within Labrador's Central mineral belt and less than one kilometre south of the Two Time zone project (indicated and inferred resource of 5.55 Mlb (million pounds) U3O8, June, 2008), formerly held by Silver Spruce Resources Inc., and consists of a mineral claim block comprised of 17 contiguous claims covering 423 hectares. The Central mineral belt in Labrador also hosts Paladin Energy Ltd.'s recently acquired Michelin deposit (measured and indicated resource of 82.2 Mlb U3O8). Readers are cautioned that past results or discoveries on properties in proximity to the project are not necessarily indicative of the presence of similar mineralization on the project.
Exploration work on the project between 2006 and 2008 consisted of airborne geophysics, prospecting, lake sediment and soil sampling, radon gas surveys, and diamond drilling. The exact number of holes completed on the current project has not yet been verified. Drilling to follow up a radon gas anomaly identified the Snegamook zone uranium occurrence located 1.3 kilometres along strike to the southeast of the Two Time zone project. Seventeen drill holes intersected a 20- to 50-metre-wide section of uranium-bearing brecciated and altered monzodiorite with moderate to strong chlorite, hematite and carbonate alteration, the same geological setting as the Two Time zone project.
Four mineralized lenses were traced over a strike length of 300 metres and to a vertical depth of 200 metres. The lenses are shallow dipping (15 to 20 degrees west) and vary in width from five to 53 metres with values ranging from 225 to 771 ppm (parts per million) U3O8. Individual one-metre sample values range from 50 to 1,110 ppm U3O8, with the widest section in drill hole SN-08-8 averaging 206 ppm U3O8 over 73 metres. The zones appear to be disrupted to the south and down dip by steeply dipping fault structures that displace the basement gneiss but remain open to the north.
Two drill holes (SN-08-18 and SN-08-20) tested a radon gas anomaly 500 metres to the south of the Snegamook zone. They intersected nine metres (210 to 219 m) of 552 ppm U3O8 and five metres (191 to 196 m) of 224 ppm U3O8. Higher grade zones, 0.11 per cent U3O8 over three m and 0.11 per cent U3O8 over two m, were located within the highlighted zone in SN-08-18.
No work has been conducted on the project since 2008. The company's initial focus will be on the compilation of all historic exploration data on the project followed by the design and implementation of an initial drill campaign to verify and expand the historical mineralization.
"We are excited to add the Snegamook project to our portfolio," said vice-president, exploration, Trevor Perkins. "The Central mineral belt in Labrador has seen a resurgence in activity recently and is relatively underexplored. It is exciting to get involved in an area that will potentially see the next wave of uranium discoveries in Canada," continued Mr. Perkins.
"We have been seeking a second uranium project for some time and Snegamook meets some important criteria for us," said chief executive officer Alex Klenman. "The project offers proven shallow mineralization proximal to a known deposit. It provides exploration upside for both expansion and for new discoveries. In the mid-2000s the region was quite active with uranium exploration activity and now once again there are some large companies leading exploration efforts in the area. This initial land position allows Azincourt to establish a foothold in this emerging Canadian uranium camp," continued Mr. Klenman.
Pursuant to terms of the option, the company can acquire a 100-per-cent interest in the project by completing a series of share issuances and incurring certain expenditures on the project, as shown in the attached table.
Following exercise of the option, the project will be subject to a 2-per-cent net smelter returns royalty, half of which may be purchased back at any time for a one-time cash payment of $1-million to the underlying optionors.
All securities issued in connection with the option will be subject to a four-month-and-one-day statutory hold period. A finder's fee totalling 5.1 million common shares is payable by the company to an arm's-length third party in connection with the option, of which 1,633,333 shares are payable upon closing of the option with the remaining common shares issuable upon completion of the share issuances owing on the nine-, 21- and 23-month anniversaries in order to maintain the option in good standing. The option remains subject to the approval of the TSX Venture Exchange.
Non-brokered private placement
The company also announces that it will offer up to 66,666,667 units of the company by way of non-brokered private placement at a price of 1.5 cents per unit for gross proceeds of up to $1-million. Each unit will comprise one common share and one common share purchase warrant. Each warrant will be exercisable at a price of five cents into one common share for a period of 36 months from the date of issue.
The gross proceeds of the private placement will be used for general working capital and exploration work on the project. The gross proceeds will not be used for any payments to non-arm's-length parties of the company nor for any payment relating to persons conducting investor relations activities.
In connection with the private placement, the company may pay finders' fees to eligible third parties that have assisted in introducing subscribers to the company. All common shares to be issued in connection with the private placement will be subject to a four-month-and-one-day statutory hold period in accordance with applicable securities laws. Completion of the private placement remains subject to the approval of the exchange. It is expected that the private placement will not result in the creation of a new control person of the company.
Grant of restricted share units
The company also announces the grant of 15 million restricted share units (RSUs) to directors, management and consultants under the company's shareholder-approved incentive plans. The RSUs will vest and convert into common shares on the date that is twelve months from the date of issuance. The grant of such RSUs is intended to align compensation of directors, management and consultants with the interests of shareholders.
Qualified person
The technical information in this news release has been prepared in accordance with the Canadian regulatory requirements set out in National Instrument 43-101 and reviewed on behalf of the company by C. Trevor Perkins, PGeo, vice-president, exploration, of Azincourt Energy, and a qualified person as defined by National Instrument 43-101.
About Azincourt Energy Corp.
Azincourt is a Canadian-based resource company specializing in the strategic acquisition, exploration and development of alternative energy/fuel projects. The company has been a uranium explorer for over a decade and is currently active at its majority-owned joint venture East Preston uranium project located in the Athabasca basin, Saskatchew