TORONTO, ONTARIO - June 6, 2017 - InvestorsHub NewsWire - First
Cobalt Corp. (TSX
VENTURE:FCC) (FTSSF) (the "Company") is pleased to announce
it has entered into an option agreement with Cobalt One Limited
(CO1.AX) to enter into a 50-50 joint venture on
the Yukon cobalt extraction refinery in Cobalt, Ontario.
Highlights
- Agreement provides First Cobalt access to a refinery and 40
acres of permitted property capable of processing the silver-cobalt
arsenide concentrates historically produced in the Cobalt, Ontario
mining camp
- Tailings disposal area is expandable to 2-3 times larger under
existing permits
- Refinery is one of only four fully permitted facilities in
Canada capable of treating this type of ore and the only such
facility in this mining camp
- Strategic partnership with Cobalt One, which shares First
Cobalt's vision for bulk mining in the Cobalt camp, provides access
to a site capable of processing material from the historic
Keeley-Frontier mine
Trent Mell, President & Chief Executive Officer
commented,
"The Yukon refinery and the 40 acres of permitted property
can help us reduce the permitting timeline in a meaningful fashion
for a future development project. We are very pleased to be
partnering with Cobalt One, which was one of the first companies to
identify the opportunity to revive this historic camp and is now
one of the largest cobalt companies in the district."
Cobalt One Executive Director Jason Bontempo commented,
"First Cobalt shares our vision of bulk mining in this
historic camp. Their complimentary land package and strong
Canadian-based management team made them logical partners for this
strategic asset. I look forward to working with Trent and his
team."
Refinery Overview
The refinery is located in Cobalt, Ontario, about 25 kilometres
from the Company's Keeley-Frontier Project. The refinery is
advantageous not only in location, but in that it is
environmentally permitted to treat and process ore containing
arsenic. The Yukon refinery is one of only four such permitted
facilities in Canada, and the only refinery in North America with
no set limits on processing or storing arsenic from feeds. This is
significant given that the camp has produced silver-cobalt arsenide
ores throughout its history. The other refineries permitted to
treat ores containing arsenic are owned by Vale, Glencore and
Sherritt International.
The refinery sits on 40.2 acres and includes a tailings
management facility and two water management ponds, with both the
space and environmental permits in place to expand the tailings
management facility by 2-3 times the current size. The refinery is
situated on a rare strategic clay-rich location within the region
which is highly suitable for the existing tailings management
facility and any future expansions to the facility.
Figure 1 - Exterior of Yukon refinery
History of the Refinery
The refinery was built in the mid-1990s. It was acquired in 2002
and kept on care and maintenance until 2012 when a German listed
company invested several million dollars upgrading the facility as
part of a brief operating agreement. On April 27, 2017 Cobalt One
announced a binding agreement to purchase the refinery, which is
expected to close before the end of June.
Figure 2 - Interior of Yukon refinery
The refinery's capabilities include three separate circuits
within the complex to process various secondary feeds using
pressure acid-leach, solvent extraction, and Merrill-Crowe for
precious metals. Primary ore feed would require the installation,
or acquisition, of a mill to prepare concentrate for processing.
The refinery will require upgrades to meet potential future
processing demands.
The building includes the refinery, control room, labs,
maintenance shop, warehouse, administrative offices and a change
room. There is also a pumping station at Lake Temiskaming.
Keeley-Frontier Project
The refinery is situated in close proximity to First Cobalt's
flagship asset, the Keeley-Frontier mine. Mineralization at the
Keeley-Frontier mine occurs as Ag-Co-Ni-Bi-arsenides predominantly
hosted in veins and stockworks known as Five-Element Vein Type
deposits, making this refinery an advantageous opportunity due to
its unique environmental permits to treat and process ore
containing arsenic. The Keeley-Frontier exploration program began
in May, and early results from surface work are anticipated in the
summer, with drilling to commence about the same time.
The Keeley and Frontier Mines were originally developed and
operated as separate mines and eventually integrated in 1961. From
1908 to 1965, the Keeley-Frontier Mine produced a total of over 3.3
million pounds of cobalt at a recovered grade of 0.5% and 19.1
million ounces of silver at a recovered grade of 58 ounces per
tonne using these reported production numbers. Most of the
production occurred between 1922 and 1931. The Company acquired a
100% option over the property in March of 2017.
The neighbouring towns of Silver Centre and Cobalt, Ontario were
historically the most prolific cobalt jurisdictions in Canada and
the largest silver producers worldwide. It is estimated that from
1904 to 1985 these two mining camps combined produced 50 million
pounds of cobalt and 600 million ounces of silver from 70 different
mines.
Terms of Agreement
In consideration for the option to enter a 50-50 joint venture,
First Cobalt will provide immediate payment of C$750,000 to Cobalt
One. First Cobalt will have until December 31, 2017 to exercise the
option. On exercise, First Cobalt will be obligated to pay Cobalt
One an additional C$2.25 million and pay the equivalent of
50,000,000 shares of ASX-listed Cobalt One in cash or shares of
First Cobalt (approximate value of C$5.5 million).
The agreement is subject to certain conditions including, but
not limited to, the receipt of all necessary regulatory and other
approvals including the approval of the TSX Venture Exchange.
Qualified Person
Dr. Frank Santaguida, P.Geo., Vice President, Exploration for
First Cobalt is the Qualified Person as defined by National
Instrument 43-101 who has reviewed and approved the contents of
this news release.
About First Cobalt
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 interests in seven prospective
copper-cobalt properties covering 190 square kilometres in the
Democratic Republic of the Congo all with known surface
mineralization, as well as an option in Canada 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.
On behalf of First Cobalt Corp.
Trent Mell, President & Chief Executive Officer
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Cautionary Note Regarding Forward-Looking
Statements
This news release may contain forward-looking statements and
forward-looking information (together, "forward-looking
statements") within the meaning of applicable securities laws and
the United States Private Securities Litigation Reform Act of 1995.
All statements, other than statements of historical facts, are
forward-looking statements. Generally, forward-looking statements
can be identified by the use of terminology such as "plans",
"expects", "estimates", "intends", "anticipates", "believes" or
variations of such words, or statements that certain actions,
events or results "may", "could", "would", "might", "occur" or "be
achieved". Forward-looking statements involve risks, uncertainties
and other factors that could cause actual results, performance and
opportunities to differ materially from those implied by such
forward-looking statements. Factors that could cause actual results
to differ materially from these forward-looking statements include
the reliability of the historical data referenced in this press
release and risks set out in First Cobalt's public documents,
including in each management discussion and analysis, filed on
SEDAR at www.sedar.com. Although First Cobalt believes
that the information and assumptions used in preparing the
forward-looking statements are reasonable, undue reliance should
not be placed on these statements, which only apply as of the date
of this news release, and no assurance can be given that such
events will occur in the disclosed times frames or at all. Except
where required by applicable law, First Cobalt disclaims any
intention or obligation to update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
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