NOT AN OFFER TO SELL OR A SOLICITATION TO BUY
ANY SECURTIES IN THE UNITED STATES OF
AMERICA.
VANCOUVER, BC, Oct. 6, 2022
/CNW/ - Capella Minerals Ltd. (TSXV: CMIL) (OTCQB: CMILF)
(FRA: N7D2) ("Capella" or the "Company") is pleased
to announce that it has entered in to a binding letter agreement
(the "Agreement") with elementX Finland Oy ("elementX") for the
acquisition of a 100% interest in a portfolio of seven lithium
(lithium-cesium-tantalum, or "LCT") pegmatite and rare-earth
element ("REE") reservations in southern Finland (Figure 1).
The elementX projects are predominantly focused on LCT pegmatite
complexes located within the Järvi-Pohjanmaa and Seinäjoki
lithium-permissive tracts as defined by the Geological Survey of
Finland ("GTK"). The southernmost
Kaldo reservation also hosts four known uranium occurrences,
including the former Käldö mine which is reported by the GTK to
have ceased operations in 1959.
The acquisition of the elementX projects will significantly
enhance Capella's existing portfolio of lithium-REE (Perho) and
copper-gold (Katajavaara-Aakenus) projects in Finland, in addition to its portfolio of
high-grade copper-cobalt-zinc projects in Norway. Accordingly, the Company will be
extremely well placed to participate in the global electrification
and decarbonization process.
Key terms of the
agreement:
- Capella will acquire 100% interests in two fully granted
reservations (Kovela and Kaldo; covering 1,692 sq. km in total) and
5 reservation applications (Rakokivenmaki, Nabba, Lappajarvi East
and West, and Kaatiala, covering 2,325 sq. km in total) in southern
Finland (Figure 1; Table 1). All
projects are located in districts with known LCT pegmatite and/or
REE occurrences, yet have been subject to little modern systematic
exploration.
- In consideration for the acquisition, Capella will issue
elementX's shareholders a total of 15.1M Capella common shares representing
approximately 10% of the Company's current outstanding shares
("Transaction Shares") and before completion of proposed financing
as outlined below. The Transaction Shares will be subject to a
minimum 4 month hold period as per TSX.V Exchange regulations, in
addition to a further voluntary 3 month hold period. In addition,
elementX will retain a 1% Net Smelter Royalty ("NSR") on any
potential future metal production from the acquired portfolio.
- Capella also announces, subject to regulatory approval, a
non-brokered Private Placement financing for gross proceeds of up
to C$600,000 for which it has secured
initial commitments of $C300,000
(including $C150,000 from elementX).
Proceeds from the Private Placement are anticipated to be used for
exploration activities at the Company's enhanced portfolio of
lithium and rare-earth element ("REE") projects in Finland and high-grade copper-cobalt projects
in Norway, as well as for general
working capital.
- Both the proposed elementX transaction and Private Placement
are subject to TSX.V Exchange approval.
Eric Roth, Capella's President
and CEO, commented: "I am extremely pleased to be reporting that
Capella is increasing its exposure to the metals required for
Europe's green energy transition
and energy storage. On September 14,
2022, the European Commission outlined the creation of the
European Critical Raw Minerals Act ("ECRM"), which is designed to
support the development of a resilient European supply chain of
both lithium and REE's. Initial targets indicated in the ECRM Act
are that at least 30% of the European Union's demand for refined
lithium by 2030 should be sourced from the EU itself (in addition
to at least 20% of REE demand).
In parallel, the Norwegian government is also strongly
supporting the construction of the country's first lithium-ion
battery plant in the northern city of Mo I Rana. This battery
plant, which is currently expected to enter in to operation in
2025, is part of a broader governmental strategy to take advantage
of the abundance of low-cost renewable (hydroelectric) energy
in-country and become a major contributor to future global lithium
battery production.
In overview, the elementX acquisition is expected to provide
Capella with a significant opportunity to be a major player in the
growth of lithium and REE production in Finland, which itself has the potential to
become one of the EU's major sources of these desired commodities.
I look forward to keeping the market updated on progress on both
our Finnish and Norwegian assets".
Table 1. List of elementX reservations in
Finland
Name
|
Status
|
Arrival
Date
|
Grant
Date
|
Concession
Name
|
Area
|
|
|
|
|
|
|
Kovela
|
Granted
|
08.06.2022
|
24.08.2022
|
Kovela
VA2022:0042
|
70 sq. km
|
Kaldo
|
Granted
|
08.06.2022
|
24.08.2022
|
Kaldo
VA2022:0043
|
1,622 sq. km
|
Rakokivenmaki
|
Application
|
10.08.2022
|
N/A
|
Rakokivenmaki
VA2022:0060
|
22 sq.km
|
Nabba
|
Application
|
10.08.2022
|
N/A
|
Nabba
VA2022:0059
|
140 sq. km
|
Lappajarvi
W
|
Application
|
12.08.2022
|
N/A
|
Lappajarvi W
VA2022:0062
|
2,131 sq. km
|
Lappajarvi
E
|
Application
|
12.08.2022
|
N/A
|
Lappajarvi E
VA2022:0061
|
Kaatiala
|
Application
|
10.08.2022
|
N/A
|
Kaatiala
VA2022:0058
|
32 sq. km
|
Private Placement
Financing
Capella has initiated a non-brokered private placement of up to
10M units at a price of C$0.06 per unit for gross proceeds up to
C$600,000 ("Private
Placement"). The Company has secured initial commitments for
C$300,000, of which $C150,000 has been committed from an elementX
shareholder.
Each unit of the Private Placement shall consist of one common
share in the capital of the Company and one-half of a share
purchase warrant, with each whole warrant entitling the holder to
purchase one additional common share at a price of C$0.12 per share at any time within two years
from the date of issuance. The warrants shall also be subject to an
accelerated exercise clause in the event the Company's share price
exceeds C$0.25 for 10 consecutive
trading days.
Proceeds from the Private Placement are anticipated to be used
for exploration activities at the Company's enhanced portfolio of
lithium and rare-earth element ("REE") projects in Finland and high-grade copper-cobalt projects
in Norway, as well as for general
working capital.
The Company may pay finders fee's in either cash, shares, share
purchase warrants or a combination thereof, as permitted by
regulators, on a portion of the Private Placement. Closing of the
Private Placement is expected to occur on or before October 31, 2022. All securities issued under the
Private Placement will be subject to a hold period of four months
from the date of issuance.
This news release does not constitute an offer to sell or a
solicitation of an offer to buy nor shall there be any sale of any
of the securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful, including any of the
securities in the United States of
America. The securities have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "1933 Act") or any state securities laws and may not
be offered or sold within the United
States or to, or for account or benefit of, U.S. Persons (as
defined in Regulation S under the 1933 Act) unless registered under
the 1933 Act and applicable state securities laws, or an exemption
from such registration requirements is available.
Qualified Persons and Disclosure
Statement
The technical information in this news release relating to the
elementX lithium and REE projects in Finland has been prepared in accordance with
Canadian regulatory requirements set out in NI 43-101, and approved
by Eric Roth, the Company's
President & CEO, a Director, and a Qualified Person under NI
43-101. Mr. Roth holds a Ph.D. in Economic Geology from the
University of Western Australia,
is a Fellow of the Australian Institute of Mining and Metallurgy
(AusIMM) and is a Fellow of the Society of Economic Geologists
(SEG). Mr. Roth has 30 years of experience in international
minerals exploration and mining project evaluation.
On Behalf of the Board of Capella Minerals Ltd.
"Eric Roth"
Eric Roth, Ph.D.,
FAusIMM
President & CEO
About Capella Minerals
Ltd
Capella is engaged in the acquisition, exploration, and
development of quality mineral resource properties with a focus on
base and battery metals in Norway
and Finland and gold in
Canada.
In Norway, the Company's
current focus is on: i) the advanced exploration-stage Hessjøgruva
copper-cobalt project and adjacent Kongensgruve and Kjøli projects
in the Røros mining district, Trøndelag County ii) the discovery of
new high-grade copper-cobalt deposits in a district-scale land
position around the past-producing Løkken (Løkken Verk District)
copper mine, Trøndelag County, and iii) the discovery of new
copper-cobalt deposits in the former Vaddas-Birtavarre mining
district of northern Norway.
In Finland, the Company's focus
is on the discovery of lithium and rare-earth element deposits at
its Perho reservation and the recently acquired portfolio of 7
projects from elementX. In addition, the Company is actively
exploring the Katajavaara-Aakenus gold-copper project in the
Central Lapland Greenstone Belt together with JV partner Cullen
Resources Ltd (ASX: CUL).
With respect to precious metals, Capella has Joint Ventures with
Prospector Metals Corp (TSXV: PPP) at the Savant Gold project in
Ontario, and with Yamana Gold Inc.
(TSX: YRI) at the Domain Gold project in Manitoba. The Company also retains a residual
interest (subject to an option to purchase agreement with Austral
Gold Ltd) in the Sierra Blanca gold-silver divestiture in
Santa Cruz, Argentina.
Cautionary Notes and
Forward-looking Statements
This news release contains forward-looking information within
the meaning of applicable securities
legislation. Forward-looking information is typically
identified by words such as: believe, expect, anticipate,
intend, estimate, postulate and similar expressions, or are those,
which, by their nature, refer to future events. Such
statements include, without limitation, statements regarding the
future results of operations, performance and achievements of
Capella, including the timing, completion of and results from the
exploration and drill programs described in this release.
Although the Company believes that such statements are
reasonable, it can give no assurances that such expectations will
prove to be correct. All such forward-looking
information is based on certain assumptions and analyses made by
Capella in light of their experience and perception of historical
trends, current conditions and expected future developments, as
well as other factors management believes are appropriate in the
circumstances. This information, however, is subject to a variety
of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected
in the forward-looking information. Important factors that could
cause actual results to differ from this forward-looking
information include those described under the heading "Risks and
Uncertainties" in Capella's most recently filed MD&A. Capella
does not intend, and expressly disclaims any obligation to, update
or revise the forward-looking information contained in this news
release, except as required by law. Readers are cautioned not to
place undue reliance on forward-looking information.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this
release.
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SOURCE Capella Minerals Limited