Capella Expands Battery Metal Focus with Acquisition of Lithium and REE Project Portfolio in Finland NOT AN OFFER TO SELL OR A SOLICITATION TO BUY ANY SECURTIES IN
Capella Expands Battery Metal Focus with Acquisition of Lithium and
REE Project Portfolio in Finland
NOT AN OFFER TO SELL OR A SOLICITATION TO BUY ANY SECURTIES IN
THE UNITED STATES OF AMERICA
.
VANCOUVER, BC
,
Oct. 6, 2022
/CNW/ -
Capella Minerals Ltd.
(TSXV: CMIL) (OTCQB: CMILF) (FRA: N7D2) ("
Capella
" or the "
Company
") is pleased to
announce that it has entered in to a binding letter agreement (the "Agreement") with elementX Finland Oy ("elementX") for the acquisition of a 100% interest in
a portfolio of seven lithium (lithium-cesium-tantalum, or "LCT") pegmatite and rare-earth element ("REE") reservations in southern
Finland
(Figure 1).
The elementX projects are predominantly focused on LCT pegmatite complexes located within the Järvi-Pohjanmaa and Seinäjoki lithium-permissive tracts as
defined by the Geological Survey of
Finland
("GTK"). The southernmost Kaldo reservation also hosts four known uranium occurrences, including the former
Käldö mine which is reported by the GTK to have ceased operations in 1959.
The acquisition of the elementX projects will significantly enhance Capella's existing portfolio of lithium-REE (Perho) and copper-gold (Katajavaara-Aakenus)
projects in
Finland
, in addition to its portfolio of high-grade copper-cobalt-zinc projects in
Norway
. Accordingly, the Company will be extremely well placed to
participate in the global electrification and decarbonization process.
Key terms of the agreement
:
Capella will acquire 100% interests in two fully granted reservations (Kovela and Kaldo; covering 1,692 sq. km in total) and 5 reservation applications
(Rakokivenmaki, Nabba, Lappajarvi East and West, and Kaatiala, covering 2,325 sq. km in total) in southern
Finland
(Figure 1; Table 1). All projects are
located in districts with known LCT pegmatite and/or REE occurrences, yet have been subject to little modern systematic exploration.
In consideration for the acquisition, Capella will issue elementX's shareholders a total of
15.1M
Capella common shares representing approximately 10%
of the Company's current outstanding shares ("Transaction Shares") and before completion of proposed financing as outlined below. The Transaction
Shares will be subject to a minimum 4 month hold period as per TSX.V Exchange regulations, in addition to a further voluntary 3 month hold period. In
addition, elementX will retain a 1% Net Smelter Royalty ("NSR") on any potential future metal production from the acquired portfolio.
Capella also announces, subject to regulatory approval, a non-brokered Private Placement financing for gross proceeds of up to
C$600,000
for which it
has secured initial commitments of
$C300,000
(including
$C150,000
from elementX). Proceeds from the Private Placement are anticipated to be used for
exploration activities at the Company's enhanced portfolio of lithium and rare-earth element ("REE") projects in
Finland
and high-grade copper-cobalt
projects in
Norway
, as well as for general working capital.
Both the proposed elementX transaction and Private Placement are subject to TSX.V Exchange approval.
Eric Roth
, Capella's President and CEO, commented: "I am extremely pleased to be reporting that Capella is increasing its exposure to the metals required
for
Europe's
green energy transition and energy storage. On
September 14, 2022
, the European Commission outlined the creation of the European Critical
Raw Minerals Act ("ECRM"), which is designed to support the development of a resilient European supply chain of both lithium and REE's. Initial targets
indicated in the ECRM Act are that at least 30% of the European Union's demand for refined lithium by 2030 should be sourced from the EU itself (in addition
to at least 20% of REE demand).
In parallel, the Norwegian government is also strongly supporting the construction of the country's first lithium-ion battery plant in the northern city of Mo I
Rana. This battery plant, which is currently expected to enter in to operation in 2025, is part of a broader governmental strategy to take advantage of the
abundance of low-cost renewable (hydroelectric) energy in-country and become a major contributor to future global lithium battery production.
In overview, the elementX acquisition is expected to provide Capella with a significant opportunity to be a major player in the growth of lithium and REE
production in
Finland
, which itself has the potential to become one of the EU's major sources of these desired commodities. I look forward to keeping the
market updated on progress on both our Finnish and Norwegian assets".
Figure 1. elementX project areas and existing Capella projects in Finland (CNW Group/Capella Minerals Limited)
Table 1.
List of elementX reservations in
Finland
Name
Status
Arrival Date
Grant Date
Concession Name
Area
Kovela
Granted
08.06.2022
24.08.2022
Kovela VA2022:0042
70 sq. km
Kaldo
Granted
08.06.2022
24.08.2022
Kaldo VA2022:0043
1,622 sq. km
Rakokivenmaki
Application
10.08.2022
N/A
Rakokivenmaki VA2022:0060
22 sq.km
Nabba
Application
10.08.2022
N/A
Nabba VA2022:0059
140 sq. km
Lappajarvi W
Application
12.08.2022
N/A
Lappajarvi W VA2022:0062
2,131 sq. km
Lappajarvi E
Application
12.08.2022
N/A
Lappajarvi E VA2022:0061
Kaatiala
Application
10.08.2022
N/A
Kaatiala VA2022:0058
32 sq. km
Private Placement Financing
Capella has initiated a non-brokered private placement of up to
10M
units at a price of
C$0.06
per unit for gross proceeds up to
C$600,000
("Private
Placement"). The Company has secured initial commitments for
C$300,000
, of which
$C150,000
has been committed from an elementX shareholder.
Each unit of the Private Placement shall consist of one common share in the capital of the Company and one-half of a share purchase warrant, with each
whole warrant entitling the holder to purchase one additional common share at a price of
C$0.12
per share at any time within two years from the date of
issuance. The warrants shall also be subject to an accelerated exercise clause in the event the Company's share price exceeds
C$0.25
for 10 consecutive
trading days.
Proceeds from the Private Placement are anticipated to be used for exploration activities at the Company's enhanced portfolio of lithium and rare-earth
element ("REE") projects in
Finland
and high-grade copper-cobalt projects in
Norway
, as well as for general working capital.
The Company may pay finders fee's in either cash, shares, share purchase warrants or a combination thereof, as permitted by regulators, on a portion of the
Private Placement. Closing of the Private Placement is expected to occur on or before
October 31, 2022
. All securities issued under the Private Placement will
be subject to a hold period of four months from the date of issuance.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful, including any of the securities in
the United States of America
. The securities have not been and will not
be registered under the United States Securities Act of 1933, as amended (the "1933 Act") or any state securities laws and may not be offered or sold within
the United States
or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and
applicable state securities laws, or an exemption from such registration requirements is available.
Qualified Persons and Disclosure Statement
The technical information in this news release relating to the elementX lithium and REE projects in
Finland
has been prepared in accordance with Canadian
regulatory requirements set out in NI 43-101, and approved by
Eric Roth
, the Company's President & CEO, a Director, and a Qualified Person under NI 43-
101. Mr. Roth holds a Ph.D. in Economic Geology from the University of
Western Australia
, is a Fellow of the Australian Institute of Mining and Metallurgy
(AusIMM) and is a Fellow of the Society of Economic Geologists (SEG). Mr. Roth has 30 years of experience in international minerals exploration and mining
project evaluation.
On Behalf of the Board of Capella Minerals Ltd.
"Eric Roth"
Eric Roth
, Ph.D., FAusIMM
President & CEO
About Capella Minerals Ltd
Capella is engaged in the acquisition, exploration, and development of quality mineral resource properties with a focus on base and battery metals in
Norway
and
Finland
and gold in
Canada
.
In
Norway
, the Company's current focus is on: i) the advanced exploration-stage Hessjøgruva copper-cobalt project and adjacent Kongensgruve and Kjøli
projects in the Røros mining district, Trøndelag County ii) the discovery of new high-grade copper-cobalt deposits in a district-scale land position around the
past-producing Løkken (Løkken Verk District) copper mine, Trøndelag County, and iii) the discovery of new copper-cobalt deposits in the former Vaddas-
Birtavarre mining district of northern
Norway
.
In
Finland
, the Company's focus is on the discovery of lithium and rare-earth element deposits at its Perho reservation and the recently acquired portfolio of 7
projects from elementX. In addition, the Company is actively exploring the Katajavaara-Aakenus gold-copper project in the Central Lapland Greenstone Belt
together with JV partner Cullen Resources Ltd (ASX: CUL).
With respect to precious metals, Capella has Joint Ventures with Prospector Metals Corp (TSXV: PPP) at the Savant Gold project in
Ontario
, and with
Yamana Gold Inc. (TSX: YRI) at the Domain Gold project in
Manitoba
. The Company also retains a residual interest (subject to an option to purchase
agreement with Austral Gold Ltd) in the Sierra Blanca gold-silver divestiture in
Santa Cruz
,
Argentina
.
Cautionary Notes and Forward-looking Statements
This news release contains forward-looking information within the meaning of applicable securities legislation. Forward-looking information is typically
identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to
future events. Such statements include, without limitation, statements regarding the future results of operations, performance and achievements of Capella,
including the timing, completion of and results from the exploration and drill programs described in this release. Although the Company believes that such
statements are reasonable, it can give no assurances that such expectations will prove to be correct. All such forward-looking information is based on
certain assumptions and analyses made by Capella in light of their experience and perception of historical trends, current conditions and expected future
developments, as well as other factors management believes are appropriate in the circumstances. This information, however, is subject to a variety of
risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information.
Important factors that could cause actual results to differ from this forward-looking information include those described under the heading "Risks and
Uncertainties" in Capella's most recently filed MD&A. Capella does not intend, and expressly disclaims any obligation to, update or revise the forward-
looking information contained in this news release, except as required by law. Readers are cautioned not to place undue reliance on forward-looking
information.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or
accuracy of this release.
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Capella Minerals Limited
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For further information:
Capella Contacts: Eric Roth, Email: [email protected]; Karen Davies, +1.604.314.2662
CO: Capella Minerals Limited
CNW 08:00e 06-OCT-22