Vancouver, British Columbia – (April 10, 2019)
Rover Metals Corp. (TSXV: ROVR) (OTCQB: ROVMF) (“Rover Metals” or the “Company”) is pleased to announce that it has entered into a non-binding letter of intent dated April 10, 2019 to acquire (the “Transaction”) all of the issued and outstanding shares of Centennial Mining, an arm’s length Nevada corporation, from a private US-based entity (the “Vendor”) in consideration of the issuance to the shareholders of the Vendor of 40,000,000 common shares in the capital of Rover Metals (the “Consideration Shares”). The Consideration Shares will be distributed to the shareholders of the Vendor, resulting in no single person holding more than 9.79% of the issued and outstanding common shares of the Company following the completion of the Transaction (post Transaction individual ownership does not give consideration to the number of shares to be issued in connection with the Company’s current private placement financing disclosed below).
Centennial Mining owns, among other things, a 100% interest in the Toquima precious metals property (the “Toquima Property”) located in Corcoran Canyon, Nevada, USA.
Completion of the Transaction is subject to a number of conditions. Such conditions include the execution of a definitive agreement; completion of satisfactory due diligence; receipt of requisite shareholder and director approvals, as applicable; and receipt of all required regulatory, corporate and third party approvals, including the approval of the TSX Venture Exchange (the “TSXV”) as the proposed Transaction may be a “Reviewable Transaction” under TSXV Policy 5.3 – Acquisitions and Dispositions on Non-Cash Assets. As a result of such conditions, there can be no assurance that the Transaction will be completed as proposed or at all
The Consideration Shares issuable on closing of the Transaction will be subject to a hold period of the greater of 12 months and the period stipulated by the TSXV.
Judson Culter, CEO at Rover Metals, states: “The Toquima Property brings Rover Metals a lower cost per meter precious metals exploration project to offset the somewhat more expensive and seasonal exploration costs of our existing Northwest Territories, Canada assets. Additionally, having recently completed our U.S. OTCQB listing we need a U.S. based asset in a mining friendly jurisdiction. The Toquima Property is available for year-round exploration.”
Trading in the Company’s common shares has been halted by the TSXV at the Company’s request. The halt is expected to continue pending the completion of certain pending conditions and the TSXV’s review and acceptance of materials regarding the satisfaction of such conditions.
This is an initial press release. The Company plans to issue a further press release once it has completed the pending conditions and provide the information prescribed by applicable policies of the TSXV related to the Transaction.
About the Toquima Property, Nevada, USA
The Toquima Property is a gold and silver project located northeast of Tonopah, in central Nevada, USA. The Property comprises 253 contiguous, unpatented mineral claims with an area of approximately 1,958.6 hectares (ha) (4,840 acres). Eight (8) Core claims are under option from Shasta Gold Corp.,19 CX claims are under option from MinQuest Inc., and 226 AR claims were staked in 2016 by Centennial. All claims are in good standing until August 31, 2019.
The Property has been explored since 1970. Between 1970 and 2011, a total of 123 holes, both core and reverse-circulation, with an aggregate length of 17,895 m (58,712 ft) were drilled on the Property. Of this total, approximately 11,500 meters in 78 holes have been drilled within the Silver Reef Zone, the most significant of the known mineral occurrences on the Property. Two historical resource estimates in the context of National Instrument 43-101 exist for the Property. The first was done in 1984 by Copper Range Exploration and estimated 4 million short tons at grades of 2.91 opt Ag and 0.014 opt Au, (3.6 million metric tonnes grading 100 g/t Ag and 0.48 g/t Au). This historical resource estimate was done by hand and none of the key assumptions, parameters, and methods used to prepare this historical resource estimate are available. The second historical resource estimate was done in 1988 by Echo Bay Explorations Inc. which reported “probable” and “possible” resources of 1,251,808 short tons at an uncut grade of 7.22 ounces per ton (opt) Ag and 0.026 opt Au, (1,135,621 metric tonnes grading 247.54 grams per tonne (g/t) Ag and 0.891 g/t Au). A qualified person has not done sufficient work to classify this historical estimate as a current mineral resource, and Rover is not treating them as a current mineral resource.
The Toquima Property is located on the eastern edge of the Toquima Range, a NNE-trending range typical of the Basin-and-Range Province. Most of the Toquima Range is underlain by volcanic rocks of Upper Oligocene to Lower Miocene age, comprising ash-flow tuffs ranging in composition from dacite to high-silica rhyolite. Structure in the Toquima Range is dominated by the generally NE-trending range-front faults on the east and west edges of the range, smaller NE-trending faults, older NW-striking pre-Basin-Range faults, and the circular faults and caldera margins of the Toquima Caldera Complex.
The Toquima Range and the San Antonio Range to the south contain the Northumberland -Tonopah gold-silver belt that hosts at least ten gold-silver mines and properties in addition to the Toquima Property, including Round Mountain (Kinross), Gold Hill, Northumberland, Manhattan, Belmont, and Tonopah. The Property exhibits similarities with most of the other Au-Ag properties in the belt: low-sulfidation epithermal mineralization in caldera margin and/or range front fault zones in veins, stockworks, and breccias hosted in hydrothermally-altered felsic volcanic rocks. Mineralization in the Silver Reef Zone is hosted in the Late Oligocene-age Corcoran Canyon Tuff dated at 27.7 Ma and the Trail Canyon Tuff dated at 23.6 Ma. Three types of felsic intrusions are present on the Property, one or more of which may be related to mineralization.
Exploration on the Property over the last 46 years has outlined the Silver Reef Zone and discovered other mineralized zones. The Silver Reef Ag-Au deposit, a potentially economic zone of pervasive quartz-adularia-sulfide veining, stockwork, and disseminated mineralization accompanied by intense quartz-sericite-pyrite alteration, occurs in a NE-trending, northwest-dipping, zone 500 m wide and 600 m long and has been defined by surface mapping and sampling as well as drilling.
Elsewhere on the Property, exploration identified four additional mineralized zones: Zone M/N is located west of the Silver Reef zone and consists of pervasive quartz-sericite alteration and quartz-adularia veining in a NE trending zone about 800 meters long. Zone R/S is a large area of strong quartz-sericite alteration on the western end of the Property, with anomalous rock and soil assay values. Zone L comprises an ENE-trending Au-Sb-As soil-rock anomaly 100 m long, over a silicified breccia zone. In Zone F, Echo Bay reported rock assays up to 30 g/t Ag, NW of Silver Reef. Although Echo Bay’s subsequent soil samples did not generate an anomaly, Bullion River reported one Au-anomalous rock sample in a rhyolite intrusion.
Technical information in this news release has been approved by Raul Sanabria, M.Sc., P.Geo., VP of Exploration at Rover Metals Corp. and a Qualified Person for the purposes of National Instrument 43-101.
Private Placement
The Company also announces that it has re-priced its previously announced private placement (the “Private Placement”) (see Rover’s March 4, 2019 press release). The Company announces that it will seek to raise an aggregate of $1.25 million through the issuance of up to 20,833,333 units of the Company (each a “Unit”) at a price of $0.06 per Unit. Each Unit will be comprised of one common share in the capital of the Company (a “Common Share”) and one Common Share purchase warrant (a “Warrant”). Each Warrant will entitle the holder to acquire one additional Common Share at an exercise price of $0.12 for a period of five (5) years from the date of issuance.
The Company currently anticipates that the net proceeds of the Private Placement will be allocated as follows: 65% for Toquima Project, 15% for Cabin Lake, and 20% for general and administrative expenses. Rover Metals anticipates closing the Private Placement in multiple closing and as funds are received.
About Rover Metals
Rover Metals is a natural resource exploration company specialized in precious metals that is currently focused on the Northwest Territories of Canada, one of the most mining friendly jurisdictions in North America. The Cabin Lake Group of High Grade Gold Projects are located within 20km of Fortune Minerals’ (TSX:FT) planned NICO Project gold-cobalt processor.
You can follow Rover Metals on its social media channels
Twitter: https://twitter.com/rovermetals
LinkedIn: https://www.linkedin.com/company/rover-metals/
Facebook: https://www.facebook.com/RoverMetals/
CEO.ca: https://ceo.ca/rovr for daily company updates and industry news.
ON BEHALF OF THE BOARD OF DIRECTORS
“Judson Culter”
Chief Executive Officer and Director
For further information, please contact:
Judson Culter
Email: judson@rovermetals.com
Phone: (604) 449-5347
Statement Regarding Forward-Looking Information
This news contains statements that constitute “forward-looking statements.” Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Rover’s actual results, performance or achievements, or developments in the industry to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects,” “plans,” “anticipates,” “believes,” “intends,” “estimates,” “projects,” “potential” and similar expressions, or that events or conditions “will,” “would,” “may,” “could” or “should” occur. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements, and readers are cautioned not to place undue reliance on these forward-looking statements. Any factor could cause actual results to differ materially from Rover’s expectations. Rover undertakes no obligation to update these forward-looking statements in the event that management’s beliefs, estimates or opinions, or other factors, should change.
Proven ProbableCategory: Blog
Blog sub category
Wednesday, April 10, 2019
TORONTO, ON / ACCESSWIRE / April 10, 2019 / Anthony Milewski, Chairman and CEO, Cobalt 27 Capital Corp. (TSX-V: KBLT) (OTCQX: CBLLF) (FRA: 270), met with the London Metal Exchange’s Product Development department to discuss their electric vehicle battery materials initiatives. The London Metal Exchange (LME) is the world centre for industrial metals trading. With the launch of its new cobalt contract, we reached out the LME with some questions that we felt investors and Cobalt 27 shareholders would find interesting.
What is the London Metal Exchange and what does it offer as a platform?
The London Metal Exchange (LME) is the world centre for industrial metals trading. The prices discovered across the LME’s three trading platforms – the Ring, the inter-office ‘telephone’ market and LMEselect, our electronic trading platform – are used as the global reference price and, both the metal and investment communities use the LME to transfer or take on risk, 24 hours a day.
The LME has had a cobalt contract since 2010. Why is the Exchange launching a new cobalt contract now?
The LME launched its physically-settled LME Cobalt contract in 2010, which has been a steady performer amongst a core group of supporters for a physically settled contract. That said, the LME has also seen growing appetite for a cash-settled contract over recent years with the rise in demand for Electric Vehicles (EVs) and battery metals. Last year, we consulted the market in order to identify the best risk management solutions. Following extensive engagement with the market, on 11 March 2019, we launched a cash-settled LME Cobalt (Fastmarkets MB) contract, to complement our existing physically-settled offering. This new cash-settled contract is settled against the Fastmarkets MB Standard Grade index, allowing market participants who have exposure to the aforementioned price in their physical contracts, to hedge across the cobalt value chain with no basis risk.
What are the differences between the new cash-settled LME Cobalt (Fastmarkets MB) contract and the existing physically-settled LME Cobalt contract?
There are several differences between the two contracts, but the most relevant are the settlement structure, settlement price and prompt date structure.
Designed to mirror physical trading, daily prompts enable users of the physically-settled LME Cobalt contract to accurately hedge their physical transactions down to the day.
The LME Cobalt (Fastmarkets MB) contract settles on the last business day of each month in accordance with the LME trading calendar, out to 15 months, to the price of the Fastmarkets MB Index. In contrast, the physically-settled LME Cobalt contract offers daily prompt dates out to three months, weekly prompt dates between three and six months, and monthly prompt dates from the sixth month onward out to 15 months.
Cash settlement is a method used in certain futures and options contracts where, upon expiration or exercise, the seller of the financial instrument does not deliver the actual physical underlying asset but instead transfers the associated cash position. For sellers who do not wish to take actual possession of the underlying cash commodity, cash settlement is a more convenient method of transacting futures and options contracts. Cash settlement is also preferred by financial investors who bring additional liquidity reducing the bid-offer spread, and thus lowering the cost of trading.
And what about the physical delivered contract? What will happen to that now?
The LME recognises the ongoing market support for its physically-settled cobalt contract which has seen a steady uptake in recent months, with an increase in both trading volumes and stocks, and as such it will continue to offer a physically-settled option alongside the new cash-settled LME Cobalt (Fastmarkets MB) contract.
Physical settlement enables short position holders to deliver warrants – a warehouse warrant for the storage of metal, issued by a LME-listed warehouse and in a form approved by the Exchange – against their positions, whilst long position holders will receive warrants, and ultimately, take physical delivery of the metal or close out their position.
Physical settlement is preferred by a number of market participants such as cobalt producers who prefer the option of physical delivery, and the steady growth of the battery metals market in recent years has opened up the cobalt market to a number of new market participants wanting to gain exposure to the cobalt price and have the tools available to manage their price risk. In recent months we have heard of a number of cobalt producers who are interested in listing their brands on the LME and as part of our ongoing commitment to lowering barriers to market entry and serving the physical market, the LME has recently waived all brand listing fees for cobalt producers wanting to enter the market and list their brands on the LME. This waiver will last for 6 months, until October 2019, and any producers interested in listing on the LME should reach out to the team who will be happy to discuss this in more detail.
Who is the new cash-settled contract for?
Over the past few years, we have seen extreme volatility in the cobalt market which has a knock-on effect on the entire value chain, causing operational concerns – increasing financing costs, increasing counterparty risk and, ultimately, increasing the price of goods for consumers.
Furthermore, the significant growth in EVs in recent years has bought new players to the metals market, with considerable capital to invest in this space. Up until now, these new market participants have struggled to manage their exposure to the cobalt price, especially along the forward curve, as they have not had the tools available to them. The new cash-settled LME Cobalt (Fastmarkets MB) contract provides exposure to the Fastmarkets MB Cobalt Standard Grade price, helping market participants to manage risk along the entire cobalt value chain. A few examples of market participants who can benefit from these hedging tools include:
- Miners, traders and hydroxide producers, as well as traditional consumers like the super alloy industry, whose procurement contracts are linked to the Fastmarkets MB Cobalt Standard Grade index
- Cobalt sulphate producers and consumers whose procurement contracts are linked to the Fastmarkets MB Standard Grade price, including the EVs and Lithium-ION batteries industry
As liquidity grows, we expect a number of financial participants including funds and money managers to take an interest in the contract.
The LME Cobalt (Fastmarkets MB) contract will be available to trade 24 hours a day across the LME’s telephone market and from 01:00-19:00 London time on LMEselect, the LME’s electronic market.
What liquidity can we expect?
Building liquidity is always the biggest challenge for new exchange-traded products generally, and especially for small markets like cobalt, but we expect liquidity to grow progressively as our members deploy the infrastructure upgrades that allow them to access this market.
As observed in similar markets, we expect to see the majority of initial liquidity on the telephone market. However, over time we hope to see an increase in the amount of physical players benefiting from the contract and contributing towards an increase in on-screen liquidity and deep order book – providing the transparency and exposure that market participants require.
We have also introduced a new membership category of Registered Intermediating Brokers (RIBs). These are brokers who facilitate trades between two parties – either LME members or clients – helping to grow liquidity in smaller niche markets such as the cobalt market. We have seen in the past how RIBs have greatly supported the initial liquidity in other new markets such as LME Steel Scrap and LME Steel Rebar, playing an integral role in helping these markets to grow.
For more information about the LME’s cobalt offering, please contact one of the team at product.development@lme.com
I welcome shareholders to get in touch with any comments.
Anthony Milewski,
Chairman and CEO
Cobalt 27 Capital Corp.
About Cobalt 27 Capital Corp.
Cobalt 27 Capital Corp. is a leading battery metals streaming company offering exposure to metals integral to key technologies of the electric vehicle and energy storage markets. The Company owns physical cobalt and a 32.6% Cobalt Stream on Vale’s world-class Voisey’s Bay mine, beginning in 2021. Cobalt 27 is undertaking a friendly acquisition of Highlands Pacific which is expected to add increased attributable nickel and cobalt production from the long-life, world-class Ramu Mine. The Company also manages a portfolio of 11 royalties and intends to continue to invest in a cobalt and nickel focused portfolio of streams, royalties and direct interests in mineral properties containing battery metals.
For further information please visit the Company website at www.cobalt27.com
Forward-Looking Information: This interview may contain certain information which constitutes ‘forward-looking statements’ and ‘forward-looking information’ within the meaning of applicable Canadian securities laws. Forward-looking statements address future events and conditions which involve inherent risks and uncertainties. Actual results could differ materially from those expressed or implied by them. Examples of forward looking information and assumptions include future estimates of the worldwide supply and demand for cobalt and other metals and the effect that these changes could have on the short term and long term price of cobalt and other metals on the world markets, statements regarding the future operating or financial performance of Cobalt 27 including the net present value, metal recoveries, capital costs, operating costs, production, rates of return and payback. Forward looking statements involve known and unknown risks and uncertainties which may not prove to be accurate. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Among those factors which could cause actual results to differ materially are the following: market conditions and other risk factors listed from time to time in Cobalt 27 Capital Corp.’s reports filed with Canadian securities regulators on SEDAR at www.sedar.com.
In some cases, forward-looking statements can be identified by terminology such as “may”, “will”, “should”, “expect”, “projects”, “plans”, “anticipates” and similar expressions. These statements represent management’s expectations or beliefs concerning, among other things, future operations and various components thereof affecting the economic performance of Cobalt 27. Undue reliance should not be placed on these forward-looking statements which are based upon management’s assumptions and are subject to known and unknown risks and uncertainties, including the business risks discussed above, which may cause actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted.
Links: Some of the posted entries on in this interview may include links to 3rd party websites. Cobalt 27 has not reviewed all websites linked to or from this Site and is not responsible for the contents of any such websites. The inclusion of any link does not imply endorsement by Cobalt 27 of the linked website or its content. Use of any such linked website is at the user’s own risk.
SOURCE: Junior Mining Network
View source version on finance.yahoo.com: https://finance.yahoo.com/news/lmes-cobalt-contract-history-cobalt-130000903.html
April 10, 2019
Vancouver, B.C., Granite Creek Copper Ltd. (TSX.V: GCX) (“Granite Creek” or the “Company”) announces that the Company’s common shares have commenced trading on the Frankfurt Stock Exchange under the symbol “A2PFE0”. The Company’s common shares continue to be listed on the TSX Venture Exchange under the symbol “GCX”.
President & CEO, Tim Johnson, stated, “With the Frankfurt exchange being amongst the world’s largest by market capitalization, this listing will significantly expand our shareholder base and access to international capital. The Company continues to pursue a number of initiatives with respect to the Stu Project and we are looking forward to providing additional updates over the coming weeks as we approach the start of the 2019 field exploration season.”
About Granite Creek Copper
Granite Creek is a Canadian exploration company focused on the 100%-owned Stu Copper-Gold project located in the Yukon’s Carmacks Copper District which covers 111 square kilometres adjacent to Capstone Mining’s high-grade Minto Cu-Au-Ag Mine and Copper North’s advance stage Carmacks Cu-Au-Ag project. More information about the company and the Stu Copper project can be viewed on the Company’s website at www.gcxcopper.com.
About the Metallic Group of Companies
The Metallic Group is a collaboration of leading precious and base metals exploration companies focused on high-potential, brownfields exploration assets adjacent to high-grade operating mines in proven in North American districts with excellent infrastructure. Focusing exploration in these proven brownfields districts increases the probability of new discoveries and allows for rapid advancement of resources to create value.
Member companies have highly experienced management and technical teams with track records of successful discovery and project development, including capital markets and financing expertise. Metallic Group professional backgrounds include former leadership positions with Barrick Gold, Goldfields, Stillwater Mining and leading explorer/developers NovaGold, Trilogy Metals and Wellgreen Platinum. Company leaders have been credited with the discovery, or expansion and advancement, of several major deposits in North America, and have significant ownership positions in the companies.
The Group and its members are headquartered in Vancouver, BC, Canada, with company stocks currently listed on the TSX Venture, US OTC, and Frankfurt stock exchanges.
FOR FURTHER INFORMATION PLEASE CONTACT:
Timothy Johnson, President
Telephone: 1 (604) 235-1982
Toll Free: 1 (888) 361-3494
E-mail: info@gcxcopper.com
Website: www.gcxcopper.com
Metallic Group: www.metallicgroup.ca
Gowest Announces $8 Million Investment By Fortune Future Holdings Limited
April 9, 2019, 7:45 am
TORONTO, ONTARIO – (April 9, 2019) Gowest Gold Ltd. (“Gowest” or the “Corporation”) (TSX VENTURE: GWA) announced today that Fortune Future Holdings Limited (“Fortune”) has agreed to purchase, on a non-brokered private placement basis, common shares of the Corporation for aggregate gross proceeds of $8,000,000 (the “Private Placement”).
The Private Placement is subject to the completion of a consolidation of the outstanding common shares of the Corporation (the “Consolidation”), on a one (1) for ten (10) basis, prior to the closing of the Private Placement. Pursuant to the proposed Consolidation, holders of common shares of the Corporation will receive one (1) post-Consolidation common share in exchange for every ten (10) pre-Consolidation common shares outstanding immediately prior to the Consolidation. The Consolidation will affect all holders of common shares uniformly and will not affect any shareholder’s percentage ownership interest in the Corporation.
The common shares to be issued to Fortune pursuant the Private Placement will be issued at a price of $0.45 per share on a post-Consolidation basis (being equal to $0.045 per share on a pre-Consolidation basis).
Details of the Private Placement
In connection with the Private Placement, the Corporation has received, and accepted, an irrevocable subscription from Fortune for the full amount of the Private Placement.
Pursuant to the Private Placement, the Corporation will issue to Fortune an aggregate of 17,777,777 common shares at a price of $0.45 per share on a post-Consolidation basis (being equal to 177,777,777 common shares at a price of $0.045 per share on a pre-Consolidation basis). On April 8, 2019, the closing price of the common shares of the Corporation on the TSX Venture Exchange (“TSX-V”) was $0.0375. During the prior month, the common shares of the Corporation traded on the TSX-V between $0.03 (low) and $0.04 (high).
Fortune is an investment company based in Chifeng City, Inner Mongolia, China, focused on investment in companies engaged in the exploration for, and the mining and sale of, mineral resources. In addition to its primary office in Chifeng City, Fortune has branches in Hong Kong and Beijing and is involved with various mining projects throughout China, Mongolia, Nigeria and Algeria. Fortune is incorporated under the laws of the British Virgin Islands.
Fortune made its initial investment in the Corporation in June 2014 and currently holds ownership of greater than 10% of the outstanding common shares of the Corporation. As of the date hereof, Fortune holds 85,000,000 common shares of the Corporation representing approximately 19.8% of the outstanding common shares of the Corporation. Fortune was previously a “control person” of the Corporation. Assuming the completion of the Private Placement, and no further issuances of common shares by the Corporation prior to the closing date, Fortune would hold 26,277,777 common shares on a post-Consolidation basis (being equal to 262,777,777 common shares on a pre-Consolidation basis), representing approximately 43.3% of the outstanding common shares of the Corporation.
Pursuant to the terms of the Private Placement, closing is to occur following the receipt of requisite shareholder approvals for the Private Placement and the implementation of the Consolidation (as described in greater detail below). There are no material conditions to the closing of the Private Placement, other than: (i) the receipt of required shareholder approvals (for the Private Placement and Consolidation); (ii) the receipt of required regulatory approvals, including the approval of the TSX-V; (iii) the requirement that there be no material adverse change with respect to the Corporation prior to the closing of the Private Placement; and (iv) the requirement that the representations and warranties of the parties given in the subscription agreement in respect of the Private Placement be true and correct, in all material respects, as of the closing date of the Private Placement.
Assuming the completion of the Private Placement, Fortune will have the right to appoint, and to have nominated by the Corporation for election at each annual meeting of shareholders, that number of directors or the Corporation as will represent a majority of the board of directors (the “Board”), so long as Fortune holds greater than 30% of the outstanding common shares of the Corporation. Pursuant to the terms of its initial investment in the Corporation, Fortune held a contractual right to appoint two directors to the Board.
The approval of the Private Placement follows an exhaustive search and evaluation of potential sources of capital undertaken by management and the Board over the past number of months. The terms and conditions presented to the Corporation by Fortune pursuant to the Private Placement have been determined by the Board to be reasonable in the circumstances of the Corporation; in particular having regard to the current challenging financial and operational circumstances affecting the Corporation and the difficult market conditions affecting junior mining issuers generally. No alternative commercially reasonable financing options of the magnitude of the Private Placement were identified the Corporation. In the opinion of management and the Board, the Private Placement represents the best financing option available to the Corporation at this time.
After consideration of all relevant circumstances, the Board (with the representatives of Fortune abstaining) has approved the Private Placement and has determined that the Private Placement is in the best interests of the Corporation.
Among other factors considered by the Board in approving the Private Placement: (i) the issue price of the common shares represents a premium to the recent trading price of the common shares on the TSX-V; (ii) the Private Placement presents lower-execution risk given Fortune’s familiarity with the Corporation and its operations and no further due diligence is required to be conducted by Fortune; (iii) the investment by Fortune may assist the Corporation in its efforts to raise additional funds, including by way of additional “flow-through” investment in the Corporation; (iv) shareholders will continue to participate in any future appreciation in the value of the common shares of the Corporation; and (v) the significant investment by Fortune confirms its long-term commitment to the Corporation and to bringing its 100% Bradshaw Gold Deposit (“Bradshaw”) into commercial production
The proceeds of the Private Placement will be used by the Corporation for the continued development of Bradshaw. The proceeds of the Private Placement alone will not be sufficient to bring Bradshaw into commercial production. The Corporation is continuing to pursue additional financing opportunities to cover this anticipated funding shortfall and also to advance, in parallel, exploration opportunities both at and near Bradshaw.
All of the securities issuable in connection with the Offering will be subject to a hold period expiring four months and one day after date of issuance.
The securities offered have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements. This release does not constitute an offer for sale of securities in the United States.
Completion of the Private Placement remains subject to receipt of the approval of the TSX-V.
Minority Approval of Private Placement
By virtue of the fact that Fortune holds ownership of greater than 10% of the outstanding common shares of the Corporation and therefore is a “related party” of the Corporation pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”), the Private Placement will constitute a “related party transaction” of the Corporation under MI 61-101. As such, the Private Placement is subject to the minority approval requirements of MI 61-101 and will require the approval of shareholders of the Corporation, excluding Fortune (and any related parties of Fortune), prior to the closing of the Private Placement. As the Corporation is listed only on the TSX-V, the Private Placement is exempt from the valuation requirements of MI 61-101 by virtue of the exemption contained in Section 5.5(b) of MI 61-101.
Further, given that Fortune will hold greater than 20% of the outstanding common shares of the Corporation following the completion of the Private Placement, the Private Placement is subject to the approval of shareholders of the Corporation, excluding Fortune (and any related parties of Fortune), pursuant to the Corporation’s shareholder rights plan (the “Rights Plan”). The terms of the Rights Plan are set out in the Amended and Restated Shareholder Rights Plan Agreement, dated as of May 5, 2017, between the Corporation and TSX Trust Company, as rights agent. Specifically, the Private Placement is subject to the shareholders of the Corporation, excluding Fortune (and any related parties of Fortune), approving the Private Placement as a “Shareholder Approved Financing” in accordance with the Rights Plan.
The Corporation intends to call a special meeting of shareholders of the Corporation (the “Meeting”) as soon as possible for the purpose of obtaining the requisite shareholder approvals for the completion of the Private Placement. The Board recommends that shareholders vote in favour of the Private Placement.
Further information regarding the Private Placement will be contained in the management information circular to be prepared in respect of the Meeting. The management information circular will be filed under the Corporation’s profile on SEDAR (www.sedar.com) at the time that it is mailed to shareholders. All shareholders are urged to read the management information circular once it becomes available, as it will contain additional important information concerning the Private Placement.
The parties expect that the Private Placement will be completed shortly after the Meeting, subject to satisfaction of all conditions precedent to the closing of the Private Placement.
Consolidation
As indicated above, the completion of the Consolidation is a condition precedent to the closing the Private Placement. The completion of the Private Placement, among other purposes, will allow the Corporation to comply with the policies of the TSX-V, which generally prohibit the issuance of shares at a price of less than $0.05 per share.
If approved and implemented, the Consolidation will occur simultaneously for all of the Corporation’s issued and outstanding common shares and will occur prior to the completion of the Private Placement. The Consolidation will affect all holders of Common Shares uniformly and will not affect any shareholder’s percentage ownership interest in the Corporation. As the Corporation currently has an unlimited number of common shares authorized for issuance, the Consolidation will not have any effect on the number of common shares that remain available for future issuance. If the Consolidation is implemented, the exercise price and number of common shares issuable under outstanding incentive stock options and common share purchase warrants issued by the Corporation will be proportionately adjusted.
The Corporation intends to seek approval of shareholders for the Consolidation at the Meeting. The Consolidation will require the approval of not less than two-thirds (2/3) of the votes cast by the holders of common shares present in person or represented by proxy at the Meeting. The Board recommends that shareholders vote in favour of the Consolidation.
About Gowest
Gowest is a Canadian gold exploration and development company focused on the delineation and development of its 100% owned Bradshaw Gold Deposit (Bradshaw), on the Frankfield Property, part of the Corporation’s North Timmins Gold Project (NTGP). Gowest is exploring additional gold targets on its +100‐square‐kilometre NTGP land package and continues to evaluate the area, which is part of the prolific Timmins, Ontario gold camp. Currently, Bradshaw contains a National Instrument 43‐101 Indicated Resource estimated at 2.1 million tonnes (“t”) grading 6.19 grams per tonne gold (g/t Au) containing 422 thousand ounces (oz) Au and an Inferred Resource of 3.6 million t grading 6.47 g/t Au containing 755 thousand oz Au. Further, based on the Pre‐Feasibility Study produced by Stantec Mining and announced on June 9, 2015, Bradshaw contains Mineral Reserves (Mineral Resources are inclusive of Mineral Reserves) in the probable category, using a 3 g/t Au cut‐off and utilizing a gold price of US$1,200 / oz, totaling 1.8 million t grading 4.82 g/t Au for 277 thousand oz Au.
Forward-Looking Statements
Certain statements in this release constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements in this press release include, without limitation, statements relating to: the Private Placement; the proposed use of proceeds of the Private Placement; the ability of the parties, in particular the Corporation, to satisfy the conditions precedent to the closing of the Private Placement; the mailing of the management information circular in connection with the Meeting and anticipated timing thereof; and the anticipated timing of the completion of the Private Placement. Words such as “may”, “would”, “could”, “should”, “will”, “anticipate”, “believe”, “plan”, “expect”, “intend”, “potential” and similar expressions may be used to identify these forward-looking statements although not all forward-looking statements contain such words.
Forward-looking statements involve significant risks, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including risks associated with the Private Placement and financing transactions generally, such as the failure to satisfy the closing conditions contained in the subscription agreement, the absence of material adverse changes or other events which may give Fortune the basis on which to terminate the subscription agreement, and the ability of the the Corporation to complete and mail the information circular in respect of the Meeting and hold the Meeting within the time frames indicated. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by this press release. These factors should be considered carefully and reader should not place undue reliance on the forward-looking statements. These forward-looking statements are made as of the date of this press release and, other than as required by law, the Corporation does not intend to or assume any obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
For further information please contact:
Greg Romain – President & CEO – Tel: (416) 363-1210 – Email: info@gowestgold.com
Greg Taylor – Investor Relations – Tel: 416 605-5120 – Email: gregt@gowestgold.com
Gowest Gold Closes Private Placement – Provides Corporate Update
March 25, 2019, 4:37 pm
TORONTO, ONTARIO – (March 25, 2019) Gowest Gold Ltd. (“Gowest” or the “Company”) (TSX VENTURE: GWA) announced today that it has issued, on a non-brokered private placement basis, 40,000,000 common shares of the Company, at a price of $0.05 per common share, for aggregate gross proceeds of $2,000,000 (the “Private Placement”) pursuant to the closing of its previously announced private placement (the “Private Placement”).
All of the securities issuable in connection with the Private Placement are subject to a hold period expiring four months and one day after date of issuance. The proceeds of the Private Placement will be used by the Company for the continued development of its 100% owned Bradshaw Gold Deposit (“Bradshaw”) located in the Timmins Gold Camp.
The securities offered have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements. This release does not constitute an offer for sale of securities in the United States.
The Company would also like to advise that it is working towards a significant investment that would allow the Company to complete the Bulk Sample Program and see Bradshaw continue to advance towards commercial production. The Company will provide a further update and details concerning this potential investment in the coming days.
The funds raised from the current Private Placement will be used to help ensure the Bradshaw site will be ready for restart, to continue ongoing work at QMX Gold Corporation’s Aurbel Mill in Val d’Or, Quebec, where material from Bradshaw is to be processed (see Gowest news release dated October 30, 2018), all while the Company is working to raise additional funds.
As previously announced, (see news release dated April 16, 2018), due to financial challenges, uncertainty of the timing surrounding the processing of the Bulk Sample and the fact that there is no further capacity at the mine site to store any further underground mined material, the Company suspended mining operations at the site. During this period, the Company has worked to tightly manage its limited cash resources, while positioning the Company to be able to re-start the development of the mine when conditions warrant.
About Gowest
Gowest is a Canadian gold exploration and development company focused on the delineation and development of its 100% owned Bradshaw Gold Deposit (Bradshaw), on the Frankfield Property, part of the Company’s North Timmins Gold Project (NTGP). Gowest is exploring additional gold targets on its +100‐square‐kilometre NTGP land package and continues to evaluate the area, which is part of the prolific Timmins, Ontario gold camp. Currently, Bradshaw contains a National Instrument 43‐101 Indicated Resource estimated at 2.1 million tonnes (“t”) grading 6.19 grams per tonne gold (g/t Au) containing 422 thousand ounces (oz) Au and an Inferred Resource of 3.6 million t grading 6.47 g/t Au containing 755 thousand oz Au. Further, based on the Pre‐Feasibility Study produced by Stantec Mining and announced on June 9, 2015, Bradshaw contains Mineral Reserves (Mineral Resources are inclusive of Mineral Reserves) in the probable category, using a 3 g/t Au cut‐off and utilizing a gold price of US$1,200 / oz, totaling 1.8 million t grading 4.82 g/t Au for 277 thousand oz Au.
Forward-Looking Statements
This news release may contain certain “forward looking statements.” Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Any forward-looking statement speaks only as of the date of this news release and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
In conversation with Maurice Jackson of Proven & Probable, the executive chairman for this Canada-based company provides updates on operations and acquisition of permits for its flagship project.
Maurice Jackson of Proven and Probable sits down with Dr. John-Mark Staude the President and CEO of Riverside Resources (TSX.V RRI | OTC: RVSDF) to discuss the 5 C’s Copper, Cecilia, Cash, Canada,and Capital Structure.
Irving Resources has posted a video showing the 2019 Omu Drill Program: Omu Sinter Target at Otoineppu Mine Site. Click here to view the video.
April 2, 2019
Vancouver, British Columbia, April 2, 2019 (TSX Venture: EMX; NYSE American: EMX) – EMX Royalty Corporation (the “Company” or “EMX”) is pleased to report results for the year ended December 31, 2018. All dollar amounts are CDN unless otherwise noted.
HIGHLIGHTS FOR 2018
Financial Update
EMX had royalty revenue of $2.1 million generated in North America and Turkey during the year. The Company also received $2.1 million in property payments, and $1.1 million from the sale of marketable securities.
The Company’s net income for the year was $62.1 million, which principally resulted from an $80.3 million gain from the sale of the Malmyzh project by IG Copper LLC (“IGC”).
Royalty generation costs totaled $8.1 million, of which $1.9 million was recovered from partners. In addition, partners continued to advance projects and incur exploration expenditures totaling approximately $19 million that did not flow through to the Company’s financial statements.
General and administrative expenses totaled $4.1 million, which includes $1.1 million in salaries and consultants, $0.8 million in administrative costs, and $1.0 million in share-based payments.
Total cash used in operations was $5.9 million. Other items affecting financial results in 2018 include an impairment of $7.2 million at the Leeville royalty property in Nevada, $1.7 million in depletion costs, $1.9 million loss related to reduction in goodwill, foreign exchange gain of $3.5 million, and discretionary bonuses of $5.2 million related to the successful sale of Malmyzh (as discussed below).
Sale of Malmyzh Strategic Investment
After seven years, EMX’s strategic investment in IGC was realized in 2018 through the sale of the Malmyzh copper-gold project to Russian Copper Company (“RCC”) for US$200 million (see EMX news releases dated October 11, and October 30, 2018).
EMX received an initial cash distribution of $84.2 million from IGC in Q4 of 2018. Subject to certain escrow conditions related to the sale of Malmyzh, cash distributions of up to $5.5 million will be made to EMX as funds are released during 2019.
The Company awarded bonuses totaling $5.2 million to the Chairman, and all EMX management and staff, in recognition of the seven year effort to identify, develop and monetize the Company’s investment in IGC. The bonuses were approved by the Compensation Committee comprised of three independent directors and the Board, with Michael Winn and Dave Cole abstaining given their participation in the bonuses (see EMX news release dated November 30, 2018).
Operational Update
The Company’s royalty and mineral property portfolio totals over 90 projects on five continents.
In North America, EMX received ~$1.84 million in gross revenue from the sale of 1,116 ounces of gold from the Leeville royalty property that covers portions of Newmont Mining Corporation’s (“Newmont”) underground mining operations on the Northern Carlin Trend. Additionally, EMX executed a strategic alliance with South32 USA Exploration Inc. (“South32″) to evaluate exploration opportunities in Arizona, New Mexico, and Utah, executed another property agreement with Kennecott Exploration Company in Arizona, and saw further advances on its portfolio where partners spent approximately $7.0 million on exploration.
In Turkey, the Company received pre-production payments totaling $1.65 million related to the Akarca royalty property where engineering, metallurgical, and other project studies were advanced during the year. At the Balya royalty property, EMX received pre-production royalty payments totaling $133 thousand, and the operator continued to expand drill defined zones of lead-zinc-silver mineralization through an ongoing ~24,000 meter drill program. At the Sisorta gold royalty property, EMX received pre-production royalty payments totaling $145 thousand, and the operator continued to advance the property, having submitted an Environmental Impact Assessment study.
In Serbia, Nevsun Resources Ltd. (“Nevsun”) announced significant advancements at the Timok Project royalty property, including: a) an updated high grade Upper Zone Pre-Feasibility Study (“PFS”) that outlined a 10 year mine life yielding approximately 1.7 billion pounds of payable copper and 516 thousand ounces of payable gold, with initial production forecast to be in 2022, b) commencement of an Upper Zone exploration decline, and c) an initial inferred resource for the Lower Zone porphyry project of 1.7 billion tonnes averaging 0.86% copper and 0.18 g/t gold at a “dollar equivalent” cut-off of US$25/tonne (see Nevsun news releases dated March 28, June 5, and June 26, 2018). In Q1 2019, the acquisition of Nevsun was completed by Zijin Mining Group Co. Ltd.
In Scandinavia, the Company completed nine transactions, including four with Boreal Metals Corp. (“Boreal”), four with Norra Metals Corp (“Norra”), and one with South32 Ltd. The deals with Boreal and Norra involved receiving equity in Boreal and Norra, advance royalty payments, and a 3% NSR royalty interest in the projects, while the South32 agreement involved cash payments, work commitments, and upon earn-in, a 3% NSR royalty interest. Boreal also announced drill results at Gumsberg in Sweden, where high grade zinc-lead-silver massive sulfide mineralization was encountered (see EMX news releases dated March 1 and May 2, 2018).
In Australia, the Company acquired a prospective sediment hosted copper exploration project in the Kimberley region of Western Australia. The Company made a decision to relinquish all properties in New Zealand during the year.
OUTLOOK
The Company enters 2019 with a strong balance sheet, including working capital of $89 million comprised of $86.2 million in cash, $1.5 million in investments, $7.5 million in receivables, and $5.7 million in payables. EMX intends to operate the business as we have for the past 16 years, generating and marketing new royalty opportunities. The Company will also continue to selectively evaluate royalty acquisitions and strategic investments as we have in the past. EMX’s business model of royalty generation, royalty acquisition, and strategic investment provides multiple avenues for growing the Company’s portfolio and building shareholder value.
Despite the impairment of the Leeville royalty this past year, the Company continues to be optimistic about the potential to increase future revenue from this royalty. Newmont’s exploration successes extend southeast from the Leeville mining complex and across EMX’s royalty position. As discussed by Newmont, this trend is an important contributor to its Northern Carlin Trend development strategy. The upside exploration potential of the Leeville royalty property, coupled with a positive outlook for the gold price, underscores the upside optionality of this material Company asset.
We are also excited about the potential growth in revenue that may come from our Turkish portfolio (Balya, Akarca, and Sisorta), as well as the significant potential of our Timok royalty in Serbia, where the Upper Zone high grade copper-gold development project is scheduled to commence production in 2022. The Timok royalty is a material Company asset.
EMX continues to see strong industry interest in the Company’s royalty generation properties. More than $20 million is expected to be spent by partners advancing EMX’s portfolio during 2019. A majority of this portfolio to be explored is in the southwest U.S., Sweden and Norway. EMX will also continue to evaluate royalty acquisition and strategic investment opportunities within the regions where we currently operate, while looking for new opportunities to grow the portfolio elsewhere in the world.
The overarching goal to sustain the Company’s royalty generation, royalty acquisition, and strategic investment activities with positive cash flow was realized in 2018 with the Malmyzh sale. In addition, ongoing revenue from royalties, advance royalties and other pre-production cash payments have been increasing over time. Going into 2019, EMX is well funded to identify new strategic investment opportunities, while developing a pipeline of quality royalty and royalty generation mineral properties that provide multiple opportunities for exploration and production success.
FILING OF FORM 20F
The Company has filed a Form 20-F annual report, including the Company’s audited consolidated financial statements (the “Financial Statements”) and Management’s Discussion and Analysis, for the year ended December 31, 2018 with the U.S. Securities and Exchange Commission (the “SEC”) on EDGAR (www.sec.gov) and with Canadian securities regulators on SEDAR (www.sedar.com). The annual report is also available for viewing on the Company’s website at www.EMXroyalty.com under the heading “Investors”. Shareholders may receive a printed copy of the Company’s complete Financial Statements, or its complete Form 20-F, free of charge, upon request to the Corporate Secretary at Suite 501 – 543 Granville Street, Vancouver, British Columbia V6C 1X8, Canada.
About EMX. EMX leverages asset ownership and exploration insight into partnerships that advance our mineral properties, with EMX receiving pre-production payments and retaining royalty interests. EMX complements its royalty generation initiatives with royalty acquisitions and strategic investments. Please see www.EMXroyalty.com for more information.
Mr. Dean D. Turner, CPG, a Qualified Person as defined by National Instrument 43-101 and consultant to the Company, has reviewed, verified and approved the disclosure of the technical information contained in this news release.
For further information contact:
David M. Cole
President and Chief Executive Officer
Phone: (303) 979-6666
Email: Dave@EMXroyalty.com
Scott Close
Director of Investor Relations
Phone: (303) 973-8585
Email:SClose@EMXroyalty.com
Neither the 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.
Forward-Looking Statements
This news release may contain “forward looking statements” that reflect the Company’s current expectations and projections about its future results. These forward-looking statements may include statements regarding perceived merit of properties, exploration results and budgets, mineral reserves and resource estimates, work programs, capital expenditures, timelines, strategic plans, market prices for precious and base metal, or other statements that are not statements of fact. When used in this news release, words such as “estimate,” “intend,” “expect,” “anticipate,” “will”, “believe”, “potential” and similar expressions are intended to identify forward-looking statements, which, by their very nature, are not guarantees of the Company’s future operational or financial performance, and are subject to risks and uncertainties and other factors that could cause the Company’s actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks, uncertainties and factors may include, but are not limited to: unavailability of financing, failure to identify commercially viable mineral reserves, fluctuations in the market valuation for commodities, difficulties in obtaining required approvals for the development of a mineral project, increased regulatory compliance costs, expectations of project funding by joint venture partners and other factors.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this news release or as of the date otherwise specifically indicated herein. Due to risks and uncertainties, including the risks and uncertainties identified in this news release, and other risk factors and forward-looking statements listed in the Company’s MD&A for the year ended December 31, 2018 (the “MD&A”), and the most recently filed Form 20-F for the year ended December 31, 2018, actual events may differ materially from current expectations. More information about the Company, including the MD&A, the 20-F and financial statements of the Company, is available on SEDAR at www.sedar.com and on the SEC’s EDGAR website at www.sec.gov.
Maurice Jackson of Proven and Probable sits down with Anthony Milewski the CEO and Director of Cobalt 27 Capital Corp. (TSX.V KBLT | OTCQX: CBLLF)which is a leading electric metals investment vehicle that offers direct exposure to metals integral to key technologies of the electric vehicle and battery energy storage markets.
The Company owns 2,905.7 Mt of physical cobalt and has acquired a cobalt stream on Vale’s world-class Voisey’s Bay mine beginning in 2021. Cobalt 27 is also undertaking the friendly acquisition of Highlands Pacific to create a leading high-growth, diversified battery metals streaming company.
VIDEO
AUDIO
TRANSCRIPT
Cobalt, the Electric Vehicle, and Ways to Profit from Both
Contributed Opinion
Source: Maurice Jackson for Streetwise Reports (3/30/19)
In this interview with Maurice Jackson of Proven and Probable, Anthony Milewski, chairman and CEO of Cobalt 27, discusses his streaming company’s prospects in the cobalt sector, as well as how the automobile and battery industries will affect the sector.
Maurice Jackson: Joining us for conversation is Anthony Milewski, chairman, CEO and director for Cobalt 27 Capital Corp. (KBLT:TSX.V; CBLLF:OTC; 27O:FSE), which is a leading electric metals investment vehicle that offers exposure to metals integral to key technologies of the electric vehicle and battery energy storage markets.
Glad to have you with us today to share the unique value preposition of Cobalt 27, which is a successful cobalt royalty and streaming company, in addition to providing shareholders a proxy to the metal. To really appreciate the context of today’s interview, Anthony, I believe it may be best that we provide a basic overview on the global demand for electric vehicles, in which cobalt is an essential metal.
Anthony Milewski: I think we have to take a step back and look at what I consider to be two of the most important industries on earth, which are now sitting at the precipice of one of the biggest disruptions they’ve seen potentially in the last hundred years—namely the energy industry and the automobile industry. Today, 60% of crude is actually used in automobiles and in the automobile industry. Not only are you talking about a shift away from ICE [internal combustion engines] to electric, but you’re also talking about structural changes in ownership, with a ride-hailing services, autonomous vehicles, and a bunch of changes. These changes are dramatic and impacting a whole host of companies across a lot of different parts of our societies globally.
At the heart of this change is the electric vehicle (EV). And the reason is that the electric vehicle has the sensors and the technology on it to put forward the platform for the next generation of changes inside of the automobile industry, namely autonomous driving and some of the other safety features being rolled out. To put in perspective that change, I believe we should remember where we’ve come from. And a few short years ago EV sales were effectively zero. I mean, literally, they were just this novelty item that you probably couldn’t even ride in if you wanted to.
When we IPO’d about two years ago, we talked about 7% penetration in 2025 and even then we got push back. Now analysts are predicting as high as 20% to 30% penetration in 2025. Canaccord’s numbers are even higher than that in 2030. You’re seeing a dramatic increase in the rates of adoptions the analysts are looking at.
To help get specific, 10% of car sales in November in California were electric vehicles, with similar numbers in Canada. That was driven, in part, by Tesla Model 3 deliveries. But the point is the acceleration of adoption has really happened in the last 18 months. And we’re seeing the automobile companies heavily push these vehicles, not only for the environmental aspects—namely cleaner air in large urban environments—but also because of the future of automobiles and the future of the automobile industry around autonomous driving and around automation.
Maurice Jackson: This all bodes well for cobalt demand. Sticking with demand, cobalt is an essential metal in the manufacturing of batteries. What has Cobalt 27 excited about the battery demand?
Anthony M.: Well, each one of these cars has a battery. The cobalt market is anywhere from 105,000 to 130,000 metric tons of metal equivalent. And half of that demand today is actually batteries. Your laptop computer, iPad, just about any device that you plug into the wall and recharge it with the cord and then walk away has cobalt than it. That demand already exists.
But the demand that has us excited is really the demands from the electric vehicle. If I told you the market for cobalt today is about 135,000 metric tons, then let’s assume, at 20% penetration, you’re going to need something like 250,000 to 300,000 metric tons of cobalt just for electric vehicles. What you see is that as adoption happens, the actual use of cobalt grows exponentially. We’re seeing that happen as we speak with the adoption rates in sales of these vehicles.
Maurice Jackson: In the U.S., investors are aware of Tesla’s gigafactory, but Tesla isn’t alone. How many mega factories are in construction?
Anthony M.: Well, that number is interesting, because it’s changing all the time. In 2017 I think that number was 17. A few months ago it was 70, and even a few more gigafactories have been announced in the last few weeks. So the number is over 70 now. And even as recently as this month Tesla announced the construction of a gigafactory in China.
But all of these automobile makers and battery makers have these factories slated to be built globally. One of the things about these battery producers is they aren’t particularly keen to be shipping them long distances. And so, unlike an automobile, which is highly consolidated in where it’s manufactured, what you’re seeing is a lot of different gigafactories being built globally around the world at a very quick pace. The pace is almost monthly.
Maurice Jackson: Let’s move on to supply, to see how these factories will meet production. There are some concerning challenges on the supply side of cobalt, which really makes the value proposition exciting for Cobalt 27. Where and how is supply currently being satisfied?
Anthony M.: It’s interesting. The geology of the world is such that over 70% of cobalt comes from Democratic Republic of the Congo (DRC). And by the way, it doesn’t come from the Congo. It comes from one little tiny area in the Congo. So one of the problems with cobalt is simply concentration risk. It comes from the Congo, where there are alleged human rights violations associated with mining it. And it’s tough.
That’s part of the story and the balance of the story is that it comes from nickel outside of the Congo. So in the Congo it’s copper, and in the rest of the world it comes from nickel—in Canada and Australia, in particular, but also places like Russia and Cuba. Those nickel projects—not all of them, but many of them—are nickel laterite projects with enormous capex overruns.
Now in the Congo it’s slightly different. One of the things that we’ve seen is the ability to have artisanal cobalt. The price of cobalt ran up to $44 and has now eased off, and it’s eased off in large part because of artisanal mining. Artisanal mining can mean different things to different people. It typically means that an individual is showing up and shoveling cobalt. That, in some cases, is actually legal in Congo. It’s not illegal, per se, although most of the time it is highly environmentally damaging. However, what the problem is in the Congo—or the allegations are—is that often child labor is used for that, in just not Congo.
You have concentration risk and then you have supply chain risk, and you really have a need now from the automakers and the consumers and the battery makers to secure the supply chain and really be able to communicate to the consumers of automobiles that when they buy that car, the cobalt was ethically sourced and produced.
Maurice Jackson: You referenced that 70% of cobalt comes from the DRC. From an off-take standpoint, how can manufacturers confidently rely on the DRC to meet their production needs?
Anthony M.: I think it’s a real challenge. Obviously, there are companies like Glencore International Plc (GLEN:LSE) that are perfectly capable counterparties for the battery makers and cathode makers. But it’s a wider issue—and it’s an issue that’s being addressed and is going to have to be addressed going forward—which is how do you secure clean cobalt? I don’t think you can, if you are actually sourcing artisanal cobalt.
But I think there are solutions that could be put in place to actually do that. I think today, if you are an end user, a consumer of cobalt, you really need to source that cobalt from outside of the Congo or from a mechanized minor. There was a great Wall Street Journal article about this last year. If you’re getting it from artisanal miners, I think it’s tainted. That artisanal supply’s aggregated at refineries and while one of the 25 sources may or may not be clean, if any of the sources are unclean, it’s all mixed and it taints all of it. I don’t think those challenges have been fully addressed, and I think if an automaker wants to actually be able to ensure that it can say its cobalt and its basic material pipeline are ethically sourced, they’re going to have to, for the time being, buy directly from mechanized minors or go outside the Congo going forward. They’re going to have to consider whether or not they’re prepared to invest directly into mining companies or create pretty different environments around the artisanal mining in the Congo.
Maurice Jackson: You alluded to it, but just for confirmation, does Cobalt 27 have any offtake and or holdings in the DRC?
Anthony M.: No, we absolutely do not invest in the Congo. We don’t buy cobalt out of the Congo. We don’t have streams or royalties in the Congo. From our perspective, we sit and we watch some of these large mining companies have problems in the Congo, and with multibillion-dollar market caps, and if they’re unable to successfully navigate that environment, I think it would be a challenge for us to think we could do that. So we’ve steered completely clear of it. I think that’s one of the offerings of Cobalt 27—conflict-free cobalt.
Maurice Jackson: From a sovereign standpoint, which countries have a strategic stockpile of cobalt?
Anthony M.: Historically speaking, the U.S. and China did, but the U.S. government sold down its stockpile over the last decade. Today China has the key sovereign stockpile—there are different numbers about how large that is. I think it’s a pretty material stockpile, but it’s not used for batteries. Cobalt is critical in the aerospace industry. And so the cobalt that the Chinese government has stockpiled is likely earmarked for jet engines and missiles and that type of thing, as opposed to batteries.
Maurice Jackson: Now, from a manufacturing standpoint, which automakers have a stockpile of cobalt?
Anthony M.: I’m not aware of any. I suspect there could be, but I don’t think publicly there are any.
Maurice Jackson: Now, cobalt is a byproduct, primarily of nickel and copper mining. So how does the spot price of nickel and copper affect cobalt?
Anthony M.: Well, over time nickel and cobalt have actually been fairly correlated. If you look, although that’s not been the case, certainly in 2019 as nickel was up 20-something percent and cobalt is down. But I think the key correlation is that over time, in order to get increased cobalt production, you’re going to need to see higher nickel prices and probably copper prices.
Maurice Jackson: What is the current spot price of cobalt, and how is that in relation to the historic prices?
Anthony M.: Today cobalt is in the mid-teens. There are different types of cobalt. There’s metal. Even within metal there’s a high grade and low grade, and there’s a hydroxide. And so there’s a bunch of different products. But I would say it’s in the mid teens. It’s actually—right now—cheap. On the inflation-adjusted 20-year average, cobalt price is closer to $22. So cobalt is actually looking like a pretty strong buy as a metal at the moment.
Maurice Jackson: For readers, we now see the value proposition we have before us in cobalt. Let’s discuss the value proposition we have in Cobalt 27 and how you may profit. Mr. Milewski, please introduce us to Cobalt 27.
Anthony M.: Cobalt 27 is really a proxy for the adoption of the electric vehicle. I don’t know who the ultimate winner’s going to be among automobiles—if it’s Tesla, Ford, or Beijing Auto. Maybe you should own a chipmaker—Nvidia. I don’t really know, but what I do know is if there is a winner, basic materials will be winners, and among those basic materials, we think cobalt would be particularly positioned to be a winner.
Cobalt 27 gives investors access to those price movements and the cobalt spot price in three primary ways. The first way is just we have 2,900-metric-ton stockpile of cobalt sitting in LME-bonded warehouses. The second is a basket of royalties on nickel-cobalt projects globally—large-scale projects that give the investor optionality. And then third, we have a stream on Voisey’s Bay in Canada, on its nickel-cobalt mine. We’re also in the process of completing a recent transaction on Highland Pacific to own a joint venture interest in the Ramu nickel mine.
We’re not miners, nor are we going to be. You’re not subject to capex in the same way that you are with a mining company. Instead, what we try to give investors is really the maximum torque to that adoption and price move in the coming months, days, years, as the adoption of electric vehicles rolls out.
Maurice Jackson: Now, were you able to procure your cobalt previously through streaming deals or how was that accomplished?
Anthony M.: Cobalt 27’s streams and royalties are all financially settled, whereas with the physical, that was actually stationary. It is stationary so that was a purchase. But the nature of a stream is that you typically sell the material into the market as it comes in and then you take that cash flow and you pay a dividend, you buy back more shares, or maybe you make another investment.
Maurice Jackson: Is the ultimate goal to set up offtake agreements with EV in battery manufacturers with your physical storage?
Anthony M.: Look, I think there are two different kind of avenues that are being pursued. I think the first is just to look like a traditional streaming and royalty company. Look like a Franco Nevada or Wheaton Metals or Sandstorm, which is a very well-trodden path in Canada. You can get a multiple, in some cases, of over two times NAV. Today we traded a fraction of that.
A second avenue, of course, is we’re building a supply chain for cobalt and to a lesser extent nickel, outside of the Congo, and through the cycle that’s going to be attractive to automobile makers, battery makers and other end users of these products. And so one could foresee the cycle, how we would get approached by individuals in different capacities to try to transact on what is clean material.
Maurice Jackson: Switching gears, Cobalt 27 has strategically position itself for the upside potential in the clean air revolution in EVs and batteries. But equally important are the people that are responsible for increasing shareholder value. Mr. Milewski, please introduce us to your board of directors.
Anthony M.: Cobalt 27’s lead director is Nick French. Nick spent his career, since the early ’80s, late ’70s, trading cobalt. One of the most knowledgeable traders probably alive on the cobalt industry. And so he’s on the board.
Frank Estergaard, a former KPMG partner, really adds a lot to the audit committee.
Candace MacGibbons is a mining executive. She’s highly involved in the mining industry and understands a lot of the different aspects and concerns and transactions.
Phil Williams, a banker—former banker who also runs a royalty company—is excellent in terms of just being able to look at transactions and financings and add to the conversation.
Justin Cochrane, who is also the president and COO, spent a decade as a banker and in the streaming and royalty business, and then later went on to actually be one of the earliest team members of Sandstorm, and was critical there and ran the business development. Mr. Cochrane has been in the streaming and royalty business for his entire career. So Cobalt 27 has a really a strong board.
Maurice Jackson: Tell us more about Anthony Milewski and what makes him qualified for the task at hand.
Anthony M.: I think, in a lot of ways, one of the most important things that I can do it to help create value is make sure that we have the right team in place and the right strategy so that all the team members able to execute on that strategy. And so I really see myself as someone who puts forward that strategy, and facilitates Justin and Martin and the team members executing on that growth strategy, and executing on our strategy to really be a critical part of the cobalt and nickel supply chain going forward.
Maurice Jackson: Who is on your management team?
Anthony M.: So the key members of the management team include myself, Justin Cochrane and Martin Vydra. Martin Vydra spent over 30 years at Sherritt, ran a bunch of different aspects of that business, and is incredibly knowledgeable on nickel, and nickel and cobalt. He sits on the LME cobalt committee, and he’s really industry veteran that adds a lot of insight for the business.
Maurice Jackson: Let’s get into some numbers. Please share your capital structure.
Anthony M.: We have around 85 million shares outstanding and no preferred shares. We’ve never had a financing with an attached warrant. We have some options outstanding to the management team. And then we have a revolver in place for $200 million USD, but we’ve not drawn to any of it. So it’s a pretty simple cap structure and that’s intentional. We try to keep it straight forward and simple.
Maurice Jackson: How much in cash and cash equivalents do you have?
Anthony M.: Approximately $50 million.
Maurice Jackson: How much debt do you have?
Anthony M.: We have zero debt.
Maurice Jackson: Who are your major shareholders and what is their level of commitment?
Anthony M.: Well, I couldn’t speak to the level of commitment except that our shareholders have all been extremely supportive over the last couple of years and financings. One of them is Paula Investments, [others are] CI Harbor, BlackRock, Fidelity, and Neuberger Berman on the register. We have a pretty wide range of institutional investors who have been very supportive over the last year and a half, two years since since the IPO.
Maurice Jackson: Are you a shareholder and if so, how many shares do you own and when was the last time you purchased?
Anthony M.: I own around 400,000 shares and I purchased shares as recently as January and February. So big believer in the company and also in buying shares myself when the share price is priced as it is today.
Maurice Jackson: Multilayered question—what is the next unanswered question for Cobalt 27? When can we expect a response and what determines success?
Anthony M.: I think the next big moment for us is closing the Highland Pacific transaction. That’s anticipated later this spring. I think that will be a catalyst, that closing it will show that we were able to transact. It’ll also bring in a substantial asset, a producing nickel-cobalt asset. So I think that’s definitely the next big catalyst. That’s a few months away. And that’s heavily driven by regulatory matters in terms of court dates and voting and that sort of stuff. I think once we’re through that, the next big moment we’ll be thinking about cash flow and dividends and that sort of thing. I would say in the immediate term, the big moment for us is getting through the Highland Pacific transaction.
Maurice Jackson: Mr. Milewski, last question. What did I forget to ask?
Anthony M.: I think you covered it. You did a great job covering it, so I really appreciate your time.
Maurice Jackson: Anthony, if investors want to get more information about Cobalt 27 please share the website address.
Anthony M.: It’s Cobalt27.com.
Maurice Jackson: For direct inquiries, please call (647) 846-7765 or you may e-mail info@cobalt27.com. Cobalt 27 trades on the TSX.V: KBLT, and on the OTCQX CBLLF. Last but not least, please visit provenandprobable.com for Mining Insights and Bullion Sales. You may reach us at contact@provenandprobable.com.
Maurice Jackson is the founder of Proven and Probable, a site that aims to enrich its subscribers through education in precious metals and junior mining companies that will enrich the world.
Glad to have you with us today to share the unique value preposition of Cobalt 27, which is a successful cobalt royalty and streaming company, in addition to providing shareholders a proxy to the metal. To really appreciate the context of today’s interview, Anthony, I believe it may be best that we provide a basic overview on the global demand for electric vehicles, in which cobalt is an essential metal.
Anthony Milewski: I think we have to take a step back and look at what I consider to be two of the most important industries on earth, which are now sitting at the precipice of one of the biggest disruptions they’ve seen potentially in the last hundred years—namely the energy industry and the automobile industry. Today, 60% of crude is actually used in automobiles and in the automobile industry. Not only are you talking about a shift away from ICE [internal combustion engines] to electric, but you’re also talking about structural changes in ownership, with a ride-hailing services, autonomous vehicles, and a bunch of changes. These changes are dramatic and impacting a whole host of companies across a lot of different parts of our societies globally.
At the heart of this change is the electric vehicle (EV). And the reason is that the electric vehicle has the sensors and the technology on it to put forward the platform for the next generation of changes inside of the automobile industry, namely autonomous driving and some of the other safety features being rolled out. To put in perspective that change, I believe we should remember where we’ve come from. And a few short years ago EV sales were effectively zero. I mean, literally, they were just this novelty item that you probably couldn’t even ride in if you wanted to.
When we IPO’d about two years ago, we talked about 7% penetration in 2025 and even then we got push back. Now analysts are predicting as high as 20% to 30% penetration in 2025. Canaccord’s numbers are even higher than that in 2030. You’re seeing a dramatic increase in the rates of adoptions the analysts are looking at.
To help get specific, 10% of car sales in November in California were electric vehicles, with similar numbers in Canada. That was driven, in part, by Tesla Model 3 deliveries. But the point is the acceleration of adoption has really happened in the last 18 months. And we’re seeing the automobile companies heavily push these vehicles, not only for the environmental aspects—namely cleaner air in large urban environments—but also because of the future of automobiles and the future of the automobile industry around autonomous driving and around automation.
Maurice Jackson: This all bodes well for cobalt demand. Sticking with demand, cobalt is an essential metal in the manufacturing of batteries. What has Cobalt 27 excited about the battery demand?
Anthony M.: Well, each one of these cars has a battery. The cobalt market is anywhere from 105,000 to 130,000 metric tons of metal equivalent. And half of that demand today is actually batteries. Your laptop computer, iPad, just about any device that you plug into the wall and recharge it with the cord and then walk away has cobalt than it. That demand already exists.
But the demand that has us excited is really the demands from the electric vehicle. If I told you the market for cobalt today is about 135,000 metric tons, then let’s assume, at 20% penetration, you’re going to need something like 250,000 to 300,000 metric tons of cobalt just for electric vehicles. What you see is that as adoption happens, the actual use of cobalt grows exponentially. We’re seeing that happen as we speak with the adoption rates in sales of these vehicles.
Maurice Jackson: In the U.S., investors are aware of Tesla’s gigafactory, but Tesla isn’t alone. How many mega factories are in construction?
Anthony M.: Well, that number is interesting, because it’s changing all the time. In 2017 I think that number was 17. A few months ago it was 70, and even a few more gigafactories have been announced in the last few weeks. So the number is over 70 now. And even as recently as this month Tesla announced the construction of a gigafactory in China.
But all of these automobile makers and battery makers have these factories slated to be built globally. One of the things about these battery producers is they aren’t particularly keen to be shipping them long distances. And so, unlike an automobile, which is highly consolidated in where it’s manufactured, what you’re seeing is a lot of different gigafactories being built globally around the world at a very quick pace. The pace is almost monthly.
Maurice Jackson: Let’s move on to supply, to see how these factories will meet production. There are some concerning challenges on the supply side of cobalt, which really makes the value proposition exciting for Cobalt 27. Where and how is supply currently being satisfied?
Anthony M.: It’s interesting. The geology of the world is such that over 70% of cobalt comes from Democratic Republic of the Congo (DRC). And by the way, it doesn’t come from the Congo. It comes from one little tiny area in the Congo. So one of the problems with cobalt is simply concentration risk. It comes from the Congo, where there are alleged human rights violations associated with mining it. And it’s tough.
That’s part of the story and the balance of the story is that it comes from nickel outside of the Congo. So in the Congo it’s copper, and in the rest of the world it comes from nickel—in Canada and Australia, in particular, but also places like Russia and Cuba. Those nickel projects—not all of them, but many of them—are nickel laterite projects with enormous capex overruns.
Now in the Congo it’s slightly different. One of the things that we’ve seen is the ability to have artisanal cobalt. The price of cobalt ran up to $44 and has now eased off, and it’s eased off in large part because of artisanal mining. Artisanal mining can mean different things to different people. It typically means that an individual is showing up and shoveling cobalt. That, in some cases, is actually legal in Congo. It’s not illegal, per se, although most of the time it is highly environmentally damaging. However, what the problem is in the Congo—or the allegations are—is that often child labor is used for that, in just not Congo.
You have concentration risk and then you have supply chain risk, and you really have a need now from the automakers and the consumers and the battery makers to secure the supply chain and really be able to communicate to the consumers of automobiles that when they buy that car, the cobalt was ethically sourced and produced.
Maurice Jackson: You referenced that 70% of cobalt comes from the DRC. From an off-take standpoint, how can manufacturers confidently rely on the DRC to meet their production needs?
Anthony M.: I think it’s a real challenge. Obviously, there are companies like Glencore International Plc (GLEN:LSE) that are perfectly capable counterparties for the battery makers and cathode makers. But it’s a wider issue—and it’s an issue that’s being addressed and is going to have to be addressed going forward—which is how do you secure clean cobalt? I don’t think you can, if you are actually sourcing artisanal cobalt.
But I think there are solutions that could be put in place to actually do that. I think today, if you are an end user, a consumer of cobalt, you really need to source that cobalt from outside of the Congo or from a mechanized minor. There was a great Wall Street Journal article about this last year. If you’re getting it from artisanal miners, I think it’s tainted. That artisanal supply’s aggregated at refineries and while one of the 25 sources may or may not be clean, if any of the sources are unclean, it’s all mixed and it taints all of it. I don’t think those challenges have been fully addressed, and I think if an automaker wants to actually be able to ensure that it can say its cobalt and its basic material pipeline are ethically sourced, they’re going to have to, for the time being, buy directly from mechanized minors or go outside the Congo going forward. They’re going to have to consider whether or not they’re prepared to invest directly into mining companies or create pretty different environments around the artisanal mining in the Congo.
Maurice Jackson: You alluded to it, but just for confirmation, does Cobalt 27 have any offtake and or holdings in the DRC?
Anthony M.: No, we absolutely do not invest in the Congo. We don’t buy cobalt out of the Congo. We don’t have streams or royalties in the Congo. From our perspective, we sit and we watch some of these large mining companies have problems in the Congo, and with multibillion-dollar market caps, and if they’re unable to successfully navigate that environment, I think it would be a challenge for us to think we could do that. So we’ve steered completely clear of it. I think that’s one of the offerings of Cobalt 27—conflict-free cobalt.
Maurice Jackson: From a sovereign standpoint, which countries have a strategic stockpile of cobalt?
Anthony M.: Historically speaking, the U.S. and China did, but the U.S. government sold down its stockpile over the last decade. Today China has the key sovereign stockpile—there are different numbers about how large that is. I think it’s a pretty material stockpile, but it’s not used for batteries. Cobalt is critical in the aerospace industry. And so the cobalt that the Chinese government has stockpiled is likely earmarked for jet engines and missiles and that type of thing, as opposed to batteries.
Maurice Jackson: Now, from a manufacturing standpoint, which automakers have a stockpile of cobalt?
Anthony M.: I’m not aware of any. I suspect there could be, but I don’t think publicly there are any.
Maurice Jackson: Now, cobalt is a byproduct, primarily of nickel and copper mining. So how does the spot price of nickel and copper affect cobalt?
Anthony M.: Well, over time nickel and cobalt have actually been fairly correlated. If you look, although that’s not been the case, certainly in 2019 as nickel was up 20-something percent and cobalt is down. But I think the key correlation is that over time, in order to get increased cobalt production, you’re going to need to see higher nickel prices and probably copper prices.
Maurice Jackson: What is the current spot price of cobalt, and how is that in relation to the historic prices?
Anthony M.: Today cobalt is in the mid-teens. There are different types of cobalt. There’s metal. Even within metal there’s a high grade and low grade, and there’s a hydroxide. And so there’s a bunch of different products. But I would say it’s in the mid teens. It’s actually—right now—cheap. On the inflation-adjusted 20-year average, cobalt price is closer to $22. So cobalt is actually looking like a pretty strong buy as a metal at the moment.
Maurice Jackson: For readers, we now see the value proposition we have before us in cobalt. Let’s discuss the value proposition we have in Cobalt 27 and how you may profit. Mr. Milewski, please introduce us to Cobalt 27.
Anthony M.: Cobalt 27 is really a proxy for the adoption of the electric vehicle. I don’t know who the ultimate winner’s going to be among automobiles—if it’s Tesla, Ford, or Beijing Auto. Maybe you should own a chipmaker—Nvidia. I don’t really know, but what I do know is if there is a winner, basic materials will be winners, and among those basic materials, we think cobalt would be particularly positioned to be a winner.
Cobalt 27 gives investors access to those price movements and the cobalt spot price in three primary ways. The first way is just we have 2,900-metric-ton stockpile of cobalt sitting in LME-bonded warehouses. The second is a basket of royalties on nickel-cobalt projects globally—large-scale projects that give the investor optionality. And then third, we have a stream on Voisey’s Bay in Canada, on its nickel-cobalt mine. We’re also in the process of completing a recent transaction on Highland Pacific to own a joint venture interest in the Ramu nickel mine.
We’re not miners, nor are we going to be. You’re not subject to capex in the same way that you are with a mining company. Instead, what we try to give investors is really the maximum torque to that adoption and price move in the coming months, days, years, as the adoption of electric vehicles rolls out.
Maurice Jackson: Now, were you able to procure your cobalt previously through streaming deals or how was that accomplished?
Anthony M.: Cobalt 27’s streams and royalties are all financially settled, whereas with the physical, that was actually stationary. It is stationary so that was a purchase. But the nature of a stream is that you typically sell the material into the market as it comes in and then you take that cash flow and you pay a dividend, you buy back more shares, or maybe you make another investment.
Maurice Jackson: Is the ultimate goal to set up offtake agreements with EV in battery manufacturers with your physical storage?
Anthony M.: Look, I think there are two different kind of avenues that are being pursued. I think the first is just to look like a traditional streaming and royalty company. Look like a Franco Nevada or Wheaton Metals or Sandstorm, which is a very well-trodden path in Canada. You can get a multiple, in some cases, of over two times NAV. Today we traded a fraction of that.
A second avenue, of course, is we’re building a supply chain for cobalt and to a lesser extent nickel, outside of the Congo, and through the cycle that’s going to be attractive to automobile makers, battery makers and other end users of these products. And so one could foresee the cycle, how we would get approached by individuals in different capacities to try to transact on what is clean material.
Maurice Jackson: Switching gears, Cobalt 27 has strategically position itself for the upside potential in the clean air revolution in EVs and batteries. But equally important are the people that are responsible for increasing shareholder value. Mr. Milewski, please introduce us to your board of directors.
Anthony M.: Cobalt 27’s lead director is Nick French. Nick spent his career, since the early ’80s, late ’70s, trading cobalt. One of the most knowledgeable traders probably alive on the cobalt industry. And so he’s on the board.
Frank Estergaard, a former KPMG partner, really adds a lot to the audit committee.
Candace MacGibbons is a mining executive. She’s highly involved in the mining industry and understands a lot of the different aspects and concerns and transactions.
Phil Williams, a banker—former banker who also runs a royalty company—is excellent in terms of just being able to look at transactions and financings and add to the conversation.
Justin Cochrane, who is also the president and COO, spent a decade as a banker and in the streaming and royalty business, and then later went on to actually be one of the earliest team members of Sandstorm, and was critical there and ran the business development. Mr. Cochrane has been in the streaming and royalty business for his entire career. So Cobalt 27 has a really a strong board.
Maurice Jackson: Tell us more about Anthony Milewski and what makes him qualified for the task at hand.
Anthony M.: I think, in a lot of ways, one of the most important things that I can do it to help create value is make sure that we have the right team in place and the right strategy so that all the team members able to execute on that strategy. And so I really see myself as someone who puts forward that strategy, and facilitates Justin and Martin and the team members executing on that growth strategy, and executing on our strategy to really be a critical part of the cobalt and nickel supply chain going forward.
Maurice Jackson: Who is on your management team?
Anthony M.: So the key members of the management team include myself, Justin Cochrane and Martin Vydra. Martin Vydra spent over 30 years at Sherritt, ran a bunch of different aspects of that business, and is incredibly knowledgeable on nickel, and nickel and cobalt. He sits on the LME cobalt committee, and he’s really industry veteran that adds a lot of insight for the business.
Maurice Jackson: Let’s get into some numbers. Please share your capital structure.
Anthony M.: We have around 85 million shares outstanding and no preferred shares. We’ve never had a financing with an attached warrant. We have some options outstanding to the management team. And then we have a revolver in place for $200 million USD, but we’ve not drawn to any of it. So it’s a pretty simple cap structure and that’s intentional. We try to keep it straight forward and simple.
Maurice Jackson: How much in cash and cash equivalents do you have?
Anthony M.: Approximately $50 million.
Maurice Jackson: How much debt do you have?
Anthony M.: We have zero debt.
Maurice Jackson: Who are your major shareholders and what is their level of commitment?
Anthony M.: Well, I couldn’t speak to the level of commitment except that our shareholders have all been extremely supportive over the last couple of years and financings. One of them is Paula Investments, [others are] CI Harbor, BlackRock, Fidelity, and Neuberger Berman on the register. We have a pretty wide range of institutional investors who have been very supportive over the last year and a half, two years since since the IPO.
Maurice Jackson: Are you a shareholder and if so, how many shares do you own and when was the last time you purchased?
Anthony M.: I own around 400,000 shares and I purchased shares as recently as January and February. So big believer in the company and also in buying shares myself when the share price is priced as it is today.
Maurice Jackson: Multilayered question—what is the next unanswered question for Cobalt 27? When can we expect a response and what determines success?
Anthony M.: I think the next big moment for us is closing the Highland Pacific transaction. That’s anticipated later this spring. I think that will be a catalyst, that closing it will show that we were able to transact. It’ll also bring in a substantial asset, a producing nickel-cobalt asset. So I think that’s definitely the next big catalyst. That’s a few months away. And that’s heavily driven by regulatory matters in terms of court dates and voting and that sort of stuff. I think once we’re through that, the next big moment we’ll be thinking about cash flow and dividends and that sort of thing. I would say in the immediate term, the big moment for us is getting through the Highland Pacific transaction.
Maurice Jackson: Mr. Milewski, last question. What did I forget to ask?
Anthony M.: I think you covered it. You did a great job covering it, so I really appreciate your time.
Maurice Jackson: Anthony, if investors want to get more information about Cobalt 27 please share the website address.
Anthony M.: It’s Cobalt27.com.
Maurice Jackson: For direct inquiries, please call (647) 846-7765 or you may e-mail info@cobalt27.com. Cobalt 27 trades on the TSX.V: KBLT, and on the OTCQX CBLLF. Last but not least, please visit provenandprobable.com for Mining Insights and Bullion Sales. You may reach us at contact@provenandprobable.com.
Maurice Jackson is the founder of Proven and Probable, a site that aims to enrich its subscribers through education in precious metals and junior mining companies that will enrich the world.
1) Maurice Jackson: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. Proven and Probable disclosures are listed below.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Wheaton Precious Metals. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own shares of Wheaton Precious Metals and Franco-Nevada, companies mentioned in this article.
Proven and Probable LLC receives financial compensation from its sponsors. The compensation is used is to fund both sponsor-specific activities and general report activities, website, and general and administrative costs. Sponsor-specific activities may include aggregating content and publishing that content on the Proven and Probable website, creating and maintaining company landing pages, interviewing key management, posting a banner/billboard, and/or issuing press releases. The fees also cover the costs for Proven and Probable to publish sector-specific information on our site, and also to create content by interviewing experts in the sector. Monthly sponsorship fees range from $1,000 to $4,000 per month. Proven and Probable LLC does accept stock for payment of sponsorship fees. Sponsor pages may be considered advertising for the purposes of 18 U.S.C. 1734.
The Information presented in Proven and Probable is provided for educational and informational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The Information contained in or provided from or through this forum is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The Information on this forum and provided from or through this forum is general in nature and is not specific to you the User or anyone else. You should not make any decision, financial, investments, trading or otherwise, based on any of the information presented on this forum without undertaking independent due diligence and consultation with a professional broker or competent financial advisor. You understand that you are using any and all Information available on or through this forum at your own risk.
Images provided by the author.
Commander Resources, etc.
I recently attended PDAC in Toronto. It is hard to objectively know whether there was more interest this year in the mining sector, but my visual impression was negative. This fall in attendance has continued over the last several years. I attribute this loss of interest not to the failure of commodity consumption to increase, but to “investment” made on the basis of commodity price speculation and greedy expectation from so-called leverage.
In these two discussions I give my views on the trade-war, gold consumption, the Third World etc.:
On investments…
Cork Fleck and I talked about two companies today. Renaissance Gold (REN) keeps falling to C$0.17, a price at which I find it a good buy. We also discussed Commander Resources (CMD; C$0.09). Based on the history of the company, while they have created value, I doubt if any money has ever flowed back to the shareholders. The management has changed and I hope any new value-creation profits the wallet of investors. For now, in my view, CMD has fallen more than it should have. Here is a link to a discussion that I had with Cory.
I am on my way to Singapore, to attend Mining Investment Asia and then to Hong Kong to attend Mines & Money.
Warm regards,
Jayant Bhandari
Associate: Rajni Bala
Disclaimer: All information found here, including any ideas, opinions, views, predictions, forecasts, commentaries, suggestions, or stock picks, expressed or implied herein, are for informational, entertainment or educational purposes only and should not be construed as personal investment advice. While the information provided is believed to be accurate, it may include errors or inaccuracies. The sole purpose of these musings is to show my thinking process when analyzing a stock, not to provide any recommendation. I will not and cannot be held liable for any actions you take as a result of anything you read here. Conduct your own due diligence, or consult a licensed financial advisor or broker before making any and all investment decisions. Any investments, trades, speculations, or decisions made on the basis of any information found on this site, expressed or implied herein, are committed at your own risk, financial or otherwise.