Teako Signs a Definitive Agreement to Acquire Majority Interest in Drill-Ready Løkken Project and Concurrent Non-Brokered Private Placement of up to $1,000,000
Teako Signs a Definitive Agreement to Acquire
Majority Interest in Drill-Ready Løkken Project
and Concurrent Non-Brokered Private
Placement of up to $1,000,000
Vancouver, British Columbia--(Newsfile Corp. - August 19, 2024) - Teako Minerals Corp. (CSE: TMIN)
(the "
Company
" or "
Teako
") is pleased to announce that it has executed a definitive agreement (the
"
Agreement
") with Capella Minerals Ltd. (TSXV: CMIL) ("
Capella
") pursuant to which Teako will
acquire a 90% ownership interest in the copper-zinc-cobalt ("
Cu-Zn-Co
") Løkken project in Trøndelag,
Norway (the "
Project
").
The Løkken Project will combine with the Company's adjacent Lomunda claims
of the Company's Lomunda and Venna projects and will, moving forward, collectively be referred to as
the Løkken & Venna Projects.
The Agreement represents a significant strategic advancement for the Company, enabling the
consolidation of all prospective bedrock for Løkken-type volcanogenic massive sulfide deposits in the
premier historic mining district of Trøndelag. This also provides the Company with advanced drill targets,
including the drill-ready Åmot target, which the Company intends to drill in the winter of 2024/2025, and
the Høydal target, which may be drilled subject to permitting.
Highlights:
Teako to acquire a 90% ownership interest in Capella's Løkken Cu-Zn-Co massive sulfide
("
VMS
") project, Trøndelag, central Norway.
The acquisition of Capella's Løkken project allows
Teako to further consolidate a district-scale exploration package at Løkken-Venna with significant
potential for the discovery of new high-grade Løkken-style VMS deposits.
The Løkken project contains the former Løkken mining operations (reported production of 24MT @
2.3% Cu + 1.9% Zn
1
), together with the drill-ready Åmot target and four priority satellite targets with
potential for new VMS discoveries (Høydal, Dragset-Halsatasen, Fjellslett, and Grefstofjellet).
Teako's immediate priorities will be to prepare for a maiden drill program on the Åmot VMS target
and potentially the Høydal target through the twinning of select historical drill holes, subject to
permitting, whilst advancing additional Cu-Zn-Co targets within the broader Løkken-Venna area to
drill-ready status.
Teako has arranged a concurrent non-brokered private placement financing of up to 11,111,111
Common Shares at a price of CAD$0.09 per Common Share for aggregate gross proceeds of up
to CAD$1,000,000.
Teako intends to complete the Offering to fund the cash consideration payable
in connection with the Agreement, and provide funding for drilling as well as general and
administrative expenses.
Pursuant to the Agreement, Teako must pay the following consideration:
(i) Issue to Capella 2,500,000 common shares ("
Common Shares
") on or before August 30, 2024;
and
(ii) Pay to Capella CAD$350,000 in aggregate cash consideration on or before August 30, 2024;
Additionally, Teako has agreed to the following exploration obligations on the Project: (i) completion of a
drill program on the Åmot Target of the Project within 12 months of the Agreement, subject to drill
permitting being confirmed; and (ii) completion of sufficient exploration work to develop a further two
targets on the Project to drill-ready status within 24 months of the Agreement.
Pursuant to the terms of the Agreement, Teako will be responsible for all exploration costs associated
with the Project prior to making a final investment decision with respect to commencing production.
If, at
any time, while Capella still maintains its 10% interest in the Project, Teako makes a final investment
decision to proceed with commercial production, the parties will enter into a definitive joint venture
agreement relating to their respective rights and obligations. Any accrued but unpaid costs for the
account of Capella shall be paid by way of netting out 25% of the amount of any distribution by the joint
venture to Capella until such amounts are recovered. In the event the mine is closed prior to final
repayment, the balance outstanding payable by Capella will be forgiven clear of any further obligations.
The Agreement provides for certain co-sale rights and obligations, permitting or obligating Capella, as
applicable, to sell its 10% interest in the event that Teako subsequently sells its interest in the Project.
Further, the Agreement provides that prior to consummating any transaction to sell its interest, Teako
must first offer to sell the interest to Capella on the same terms and conditions.
The Common Shares issuable to Capella will be subject to a hold period of four months and one day in
accordance with applicable securities laws.
Additionally, the Common Shares will be subject to
contractual restrictions on transfer as follows: (i) 33% of the Common Shares will be subject to a four-
month and one-day restriction from the issue date; (ii) 33% of the Common Shares will be subject to an
eight-month restriction from the issue date; and (iii) the balance of the Common Shares will be subject to
a one-year restriction from the issue date.
The Project is subject to a 2.5% Net Smelter Return royalty ("
NSR
") payable to Eurasian Minerals
Sweden AB.
Pursuant to the NSR, 0.5% of the royalty may be repurchased at any time for
US$1,000,000.
The NSR provides for annual advanced royalty payments of USD$40,000 for the first
year, increasing by USD$5,000 per annum to a maximum of USD$75,000 (the "
AAR Obligation
").
Under the terms of the Agreement, Teako will assume all payment obligations associated with the AAR
Obligation.
1
Historic production values quoted for Løkken are from Grenne T, Ihlen PM, Vokes FM (1999) Scandinavian Caledonide metallogeny in a plate-
tectonic perspective. Mineral Deposita 34:422-471). Teako has not performed sufficient work to verify the published data reported above, but the
Company believes this information to be considered reliable and relevant.
The Løkken Project
The Løkken Project, which will combine with the Company's Lomunda licenses (see
Figure
1), is a
copper-rich VMS project located approximately 50 km Southwest of the regional center of Trondheim in
Trøndelag County, central Norway.
The Løkken & Venna projects now cover a total area of 1039 sq. km.
The Løkken Project is similar to the Company's original Lomunda and Venna projects but is far more
advanced and features drill-ready targets.
It covers an area of 114 sq. km and surrounds the former
Løkken underground copper mine, which closed in 1986 in response to low copper prices.
The former
Løkken mine is considered to be one of the largest ophiolite-hosted Cyprus-type VMS deposits (by
tonnage) to have been developed in the world, producing an estimated 24Mt @ 2.3% Cu and 1.9% Zn
(plus silver and gold credits).
1
The former Løkken mine is a stratiform massive sulfide deposit
characterized by its impressive dimensions - approximately 4 km in length, a maximum depth of 1 km,
and an average thickness of 60 meters. Its rich mineral composition predominantly consisted of
chalcopyrite, sphalerite, pyrite, and pyrrhotite.
The Løkken deposit was discovered from a subtle
massive sulfide outcrop, which measured less than 1m in width. The Løkken claim block covers a
significant portion of the old Løkken mine infrastructure (shafts, historical mineral processing facilities,
railway loading area for concentrate, etc.), in addition to multiple satellite occurrences of copper-rich
VMS mineralization with varying degrees of development.
The Company has also, through staking, been
granted three new license blocks immediately adjacent to the East of the Løkken Project.
Figure 1: The Løkken & Venna Project Licenses
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Given the geological propensity of these deposits to occur in clusters, Teako believes there is a high
likelihood of additional undiscovered deposits within the district along a broadly E-W-oriented
mineralization trend (see
Figure
2).
The Løkken deposit outcrops on its eastern margin, whereas the
western margin (yellow polygon in
Figure
2) is interpreted to be truncated by a post-mineralization fault
zone, which the Orkla River now occupies.
The Orkla River lies at the current known western margin of
the Løkken deposit (Astrup Shaft) and is interpreted by Capella to represent a broadly N-S-trending
post-mineralization fault which has dissected the original Løkken VMS deposit.
Accordingly, the
potential exists for the discovery of displaced blocks of the original Løkken deposit on the western side
of the Orkla River valley.
Given the depth of mineralization at the nearby Astrup Shaft (approximately
900m vertically below the surface), the Company anticipates that any displaced blocks of mineralization
at Løkken W would lie at similar depths to Astrup and, therefore, be beyond detection for the standard
geophysical and geochemical techniques currently being applied at Løkken.
Figure 2: The Løkken Target Area
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Løkken Drill Targets
Capella's work at the Løkken project has been focused on advancing drill hole targeting within the five
highest priority target areas - the drill-ready Åmot target, together with the satellite targets at Høydal,
Grefstofjellet, Dragset-Helsetasen, and Fjellslett (see
Figure
3) - but with a clear focus on the 5km long
Løkken Mine - Høydal - Åmot corridor.
Work completed included systematic ground magnetic surveys
and soil (Ionic Leach, or "
IL
") sampling, with almost 1,000 IL samples taken over the Åmot, Høydal, and
Dragset target areas.
The Åmot target is drill-ready, with initial permitting for a maiden core drilling
program having been completed by Capella.
Figure 3: Overview of Løkken Priority Drill Targets
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The Åmot Target
The Åmot Cu-Co-Zn target is located 5km East of the former Løkken mining operations. It is hosted
within stratigraphy considered favourable for the discovery of further Løkken-type massive sulfide (VMS)
deposits.
The primary target is a large (up to 2km in length) coincident electromagnetic (EM), ground
magnetic, and geochemical anomaly, which together represent a highly favourable combination for a
buried VMS deposit (see
Figure
4).
The Åmot target is interpreted from geophysical data to lie
approximately 150 m below the surface and has never been drill-tested.
Åmot is drill-ready and
represents one of the highest-priority drill targets on the Løkken property.
Figure 4: Overview of Åmot Target Showing Ground Magnetics and Soil Geochemistry
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The Høydal Target
The Høydal Cu-Co-Zn target lies immediately to the East of the former Løkken mining operations and
within the highly prospective Løkken-Høydal-Åmot corridor.
The primary target at Høydal is a 3 km-long
corridor containing Cu-Zn-rich VMS-style mineralization (see
Figure
5), with approximately 1km of this
corridor having been tested by historical core drilling.
A total of 20,846m of core drilling (see
Figure
6) is
reported to have been completed at Høydal by Orkla Grube AB between 1910 and 1976 (Grammelvedt,
1986); future exploration is expected to focus on extending higher grade (+2% Cu and +2% Zn) zones.
The Company's initial priority at Høydal will be to confirm the high Cu-Zn grades reported in the sector
through the twinning of select historical drill holes (e.g. Orkla Grube AB holes BH 83 and BH 19 returned
3.07m @ 20.9% Cu and 1.73m @ 18.3% Zn + 0.95% Cu; Data source - Dirmin Bibliotek Rapport
BV4152 and BV1830).
Recent geological work completed by Capella has also identified a potential new corridor of
mineralization located approximately 500m South of the primary Høydal trend.
Høydal represents a
priority target for further drill testing based on its favourable geology / known mineralization and its
proximity to the former mineral processing facilities at the old Løkken mine.
Figure 5: Overview of Høydal Target Showing Ground Magnetics and Soil Geochemistry
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Figure 6: Høydal Historical Drilling and Model of Historical Mineralization Envelope2
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2
The 3D model shown in Figure 5 was generated using LeapfrogTM software using a copper cut-off grade of 1% and with the explicit purpose of
understanding the geological context of the historic Høydal mineralization with respect to the newly defined surface geophysical and geochemical
anomalies.
The historic mineralization envelope does not constitute a mineral resource estimate, and the Company does not treat the historic
mineralization as a current resource.
The Dragset-Halsetasen Target
The Dragset-Halsetasen target hosts the former Dragset open pit and underground mining operation
located approximately 5km West of the former Løkken mine.
High-grade Cu-Co-Zn mineralization at
Dragset is interpreted from both geological and geophysical data to be hosted within a fold nose, with
the southern mineralized limb of the fold zone interpreted to extend eastwards towards the Halsetasen
sector (see
Figure
7).
Further work is recommended in this Dragset-Halsetasen target to determine
high-grade resource potential.
Figure 7: Overview of the Dragset-Halsetasen Target Showing Ground Magnetics and Soil
Geochemistry
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The Fjellslett Target
The Fjellslett Cu-Co-Zn target lies on the western margin of the Løkken property. It contains outcropping
high-grade Cu-Co +/- Zn mineralization hosted within a broadly ENE-WSW-trending corridor as defined
by both geology and ground magnetic survey data (see
Figure
8).
Additional exploration work, including
ground-loop EM surveys and preliminary drilling, has been proposed by Capella for the Fjellslett target
area.