Talon Metals to explore 400K acres in UP for nickel
The land package covers terrain within 1.7 miles of the high-grade Eagle Nickel Mine
TAMARACK, Minn. (WLUC) - Talon Metals Corp. has entered an agreement with UPX Minerals Inc. for up to an 80% ownership interest in the mineral rights over a land package with 400,000 acres in the U.P.
This land package covers a highly prospective terrain within 1.7 miles of the high-grade Eagle Nickel Mine — the only active nickel mine in the USA today — and is only 0.4 miles from the Humboldt Mill.
The deal comes with a very large high-quality geophysical data package and access to a historic drill core that contain multiple high-grade nickel intercepts up to 7.4% Ni (i.e., similar grades to the Company’s Tamarack Nickel Project in Minnesota, USA). The land package was originally assembled by Henry Ford and owned for approximately 70 years by the Ford Motor Company.
“After a competitive exploration partner search, we selected Talon’s proposal due to their track record for delivering exploration success,” said Johnny DeCooman, president and CEO of Sweetwater Royalties. “The Talon team has extraordinary in-house geophysics, geology and drilling capabilities to advance several targets as already demonstrated by their success at the Tamarack Nickel Project in Minnesota. We believe that Talon is ideally positioned to identify and prove out numerous high-grade nickel deposits near the only USA nickel processing facility.”
Talon has entered into an Option Agreement with UPX to acquire up to an 80% ownership interest in the Michigan Nickel Properties.
“Talon’s acquisition of the Michigan Nickel Properties is directly responsive to Senator Manchin and other national leaders on both sides of the aisle to take urgent action to establish a battery mineral supply chain from mine to battery within the United States,” said Henri van Rooyen, CEO of Talon. “Talon will bring its proven approach to exploration and use cutting-edge technology to explore for new high-grade nickel, iron and copper deposits in the Upper Peninsula of Michigan, currently the only region in the United States that produces nickel.”
Agreement between Talon and UPX:
Pursuant to the terms of the Option Agreement, Talon has agreed to a minimum spending obligation of up to U.S. $5 million in exploration expenditures or drilling of at least 7,500 meters. Talon has five years (until August 2027) to complete these minimum requirements. Talon will earn a 51% undivided interest in the Michigan Nickel Properties upon the completion of 25,000 meters of drilling (the “Stage One Requirement”). Talon will have five years (until August 2027) to complete the Stage One Requirement, which may be extended in certain circumstances.
Talon will then have the option to earn an additional 29% interest in the Michigan Nickel Properties (resulting in an 80% ownership interest) upon delivering a Feasibility Study prepared in accordance with National Instrument 43-101 over a portion of the Michigan Nickel Properties (the “Stage Two Requirement”). In the event that Talon does not complete the Stage Two Requirement within eight years (which may be extended in certain circumstances) of determining a “mineral resource” at the Michigan Nickel Properties, Talon’s interest in the Michigan Nickel Properties will revert to 49%.
On execution of the Option Agreement, and as partial consideration for entering into the Option Agreement, Talon will issue Kennecott Exploration Company (“KEX”) 15,321,933 common shares of Talon at a deemed price of $0.51 per share (based on the 5-day VWAP of the Talon shares on the TSX) in satisfaction of US$6 million plus interest in payment obligations of UPX to KEX as a previous owner of the Michigan Nickel Properties. This share issuance is subject to the approval of the Toronto Stock Exchange. Upon Talon completing the Stage Two Requirement, UPX will be granted a 2% NSR royalty on the Michigan Nickel Properties and have the right to participate in proportion to its participating 20% joint venture interest or dilute its interest to an additional 1% NSR royalty.
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