Prophecy Gains Gibellini Vanadium Project Data Access, On Schedule to Submit Plan of Operations and Baseline Studies
Prophecy Gains Gibellini Vanadium Project Data Access,
On Schedule to Submit Plan of Operations and Baseline Studies
Vancouver, British Columbia, April 18, 2018 – Prophecy Development Corp. (“Prophecy” or
the “Company”) (TSX:PCY, OTCQX:PRPCF, Frankfurt:1P2N) is pleased to announce that it
has signed an agreement (the “Agreement”) with Monitor Ventures Inc. (“Monitor”) for the right
to access and use information related to the Gibellini vanadium project (the “Gibellini Data Pack”)
which was commissioned, compiled and held by Monitor. Monitor (previously known as American
Vanadium Corp. from 2010 to 2016, and Rocky Mountain Resources Corp . from 2007 to 2010)
had been developing the project since 2007 only to relinquish it due to the low vanadium pentoxide
price of around USD 2.50/lb in 2016. The price of v anadium pentoxide has since rebounded
significantly and is currently trading at around USD15.60/lb according to Asian Metal Inc.
In consideration, Prophecy:
(a) has paid Monitor $7,000 in cash;
(b) will, upon approval by the Toronto Stock Exchange, issue to Monitor, 50,000
warrants entitling Monitor to purchase one Common share in the capital of
Prophecy at an exercise price of $3.00 for a period of three (3) years from the date
of the Agreement; and
(c) will, upon approval of the environmental impact statement (the “EIS”) in connection
with the Gibellini vanadium project by the Bureau of Land Management (the
“BLM”), pay Monitor, $50,000 in cash.
The Gibellini Data Pack includes six boxes of printed reports and files , and over 90 gigabytes of
electronic reports, files and thousands of drawings that include, but are not limited to:
Environmental studies and permitting:
- Baseline environmental studies;
- Complete Plan of Operation;
- Preparation documents for the EIS;
- Water line and power lines Plans of Development; and
- All geographic information system files associated with the studies and plans related to
the environmental studies and permitting.
Exploration, geology and mining:
- 15,625 meters of drill database for the Gibellini and Louie Hill deposits;
- Exploration data, sample assays and geologic mapping of over 10 square miles (26
square kilometers) of claims which are now under Prophecy’s control or in adjudication;
- Other geologic and mining data and studies such as geologic, hydrological, geotechnical
and pit design reports and maps.
Metallurgical:
- Reports of metallurgical testing carried out by SGS S.A. in 2006, by Dawson Metallurgical
Laboratories in 2008, and by McClelland Laboratories in 2011;
- Pilot scale acid heap leach testing by McClelland Laboratories of a 16 tonne bulk sample
from the Gibellini deposit over a 400 day continuous period in a 6 meter tall compressed
column which simulated leaching of a 50 meter high heap; and
- Database of metallurgical test results and assays.
Engineering Procurement Construction Management:
- Basic engineering design drawings by Scotia International of Nevada Inc. including
hundreds of drawings on process flow, crushing, heap leach pad, pregnant leach solution
pond, solvent extraction plant, piping and infrastructure (power, water, and haul road); and
- Project capital and operating cost estimates based on the proposals and quotations
received from equipment vendors.
With the Agreement now in place, and further to Prophecy’s news release dated March 28, 2018,
Prophecy is on schedule to revise and submit to the BLM updated base line studies and an
updated Plan of Operations for the Gibellini vanadium project in May 2018. Upon acceptance by
the BLM of the Plan of Operations, baseline studies and an environmental report, Prophecy
expects in 2019 to trigger a Notice of Intent (“NOI”) by the BLM to prepare an EIS for the Gibellini
vanadium p roject. As a result of direction from Secretary of the Interior Order No. 3355
(Streamlining National Environmental Policy Reviews and Implementation of Executive Order
13807) Prophecy anticipates the Gibellini EIS will not be more than 150 pages (excluding
appendices) and the BLM shall complete the Gibellini Final EIS within one year from the issuance
of the NOI. This means that permitting for the Gibellini vanadium project may potentially be
concluded in 2020. The Company has started discussions with vanadium product off takers and
will provide an update on the progress in due course.
John Lee, Executive Chairman of Prophecy, states: “The Gibellini Data Pack is the culmination of
over $10 million in expenditures, tens of thousands of man-hours of work, and the effort of a multi-
disciplinary team over a 10-year period, all of which is now in the possession of Prophecy and will
expedite project development, and help achieve the Company’s stated objective of transforming
Gibellini into the first primary vanadium mine in North America, offering the best quality vanadium
pentoxide product that exceeds customer requirements for a variety applications from traditional
re-enforcement bars to high-tech grid-scale batteries and aerospace.
According to United Nations estimates, by 2030, the world will witness an urban popul ation
increase of 1 billion people which is equivalent to 100 times the current population of New York
City. An important part of the solution to this massive impending housing problem is vanadium
alloy re-enforcement steel bars to make our skyscrapers taller and safer.”
Prophecy believes the Gibellini vanadium project offers the best leverage and a direct play in
vanadium that reflects increased vanadium prices in a politically-safe, mining-friendly jurisdiction.
Prophecy expects to report findings from an independent preliminary economic assessment of
the Gibellini vanadium project in May 2018.
The Company also announces that pursuant to the terms of the Company’s share-based
compensation plan as amended, which was approved by shareholders at the Company’s annual
general meeting of shareholders held on June 2, 2016 and amended on June 13, 2017, it has
granted in aggregate, 140,000 incentive stock options (the “Options“), to various directors,
officers and consultants of the Company. The Options are exercisable at a price of $2.80 per
Common share for a term of five years expiring on April 6, 2023 and vest at 12.5% per quarter for
the first two years following the date of grant.
Qualified Persons
The technical contents of this news release have been prepared under the supervision of
Christopher M. Kravits, CPG, LPG, general mining manager to Prophecy. Mr. Kravits is a Qualified
Person as defined in NI 43-101. Mr. Kravits is a consultant to the Company and is not independent
of the Company since most of his income is derived from the Company.
About Prophecy
Prophecy Development Corp. is a Canadian public company listed on the Toronto Stock
Exchange. The Company aims to provide exposure and leverage to rising vanadium prices by
defining and adding attributable vanadium resources in the ground in politically safe jurisdictions.
Further information on Prophecy can be found at www.prophecydev.com.
PROPHECY DEVELOPMENT CORP.
ON BEHALF OF THE BOARD
“JOHN LEE”
Executive Chairman
For more information about Prophecy, please contact Investor Relations:
+1.888.513.6286
www.prophecydev.com
Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined
in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy
of this release.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in this news release, including statements which may contain words
such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, or similar expressions,
and statements related to matters which are not historical facts, are forward -looking information
within the meaning of applicable securities laws. Such forward-looking statements, which reflect
management’s expectations regarding Prophecy’s future growth, results of op erations,
performance, business prospects and opportunities, are based on certain factors and
assumptions and involve known and unknown risks and uncertainties which may cause the actual
results, performance, or achievements to be materially different from future results, performance,
or achievements expressed or implied by such forward-looking statements. These estimates and
assumptions are inherently subject to significant business, economic, competitive and other
uncertainties and contingencies, many of which, with respect to future events, are subject to
change and could cause actual results to differ materially from those expressed or implied in any
forward-looking statements made by Prophecy. In making forward-looking statements as may be
included in t his news release, Prophecy has made several assumptions that it believes are
appropriate, including, but not limited to assumptions that: all required third party contractual,
regulatory and governmental approvals will be obtained for the development, cons truction and
production of Prophecy’s properties and the Chandgana power plant; there being no significant
disruptions affecting operations, whether due to labour disruptions or other causes; currency
exchange rates being approximately consistent with current levels; certain price assumptions for
vanadium, silver, coal and other metals, prices for and availability of fuel, parts and equipment
and other key supplies remain consistent with current levels; production forecasts meeting
expectations; the accurac y of Prophecy’s current mineral resource estimates; labour and
materials costs increasing on a basis consistent with Prophecy’s current expectations; any
additional required financing will be available on reasonable terms; and market developments and
trends in global supply and demand for vanadium, energy, silver, coal and other metals meeting
expectations. Prophecy cannot assure you that any of these assumptions will prove to be correct.
Numerous factors could cause Prophecy’s actual results to differ materially from those expressed
or implied in the forward-looking statements, including the following risks and uncertainties, which
are discussed in greater detail under the heading “Risk Factors” in Prophecy’s most recent
Management Discussion and Analysis and Annual Information Form as filed on SEDAR and
posted on Prophecy’s website: Prophecy’s history of net losses and lack of foreseeable positive
cash flow; exploration, development and production risks, including risks related to the
development of Prophecy’s mineral properties; Prophecy not having a history of profitable mineral
production; commencing mine development without a feasibility study; the uncertainty of mineral
resource and mineral reserve estimates; the capital and operating costs required t o bring
Prophecy’s projects into production and the resulting economic returns from its projects; foreign
operations and political conditions, including the legal and political risks of operating in Bolivia
and Mongolia, which are developing countries and being subject to their local laws; the availability
and timeliness of various government approvals, permits and licenses; the feasibility, funding and
development of Prophecy’s projects; protecting title to Prophecy’s mineral properties;
environmental risk s; the competitive nature of the mining business; lack of infrastructure;
Prophecy’s reliance on key personnel; uninsured risks; commodity price fluctuations; reliance on
contractors; Prophecy’s need for substantial additional funding and the risk of not s ecuring such
funding on reasonable terms or at all; foreign exchange risk; anti -corruption legislation; recent
global financial conditions; the payment of dividends; the inability of insurance to cover all
potential risks associated with mining operations; conflicts of interest ; and cyber -security risks
related to the Company’s reliance on information technology systems.
These factors should be considered carefully, and readers should not place undue reliance on
Prophecy’s forward-looking statements. Prophecy believes that the expectations reflected in the
forward-looking statements contained in this news release and the documents incorporated by
reference herein are reasonable, but no assurance can be given that these expectations will prove
to be correct. In addition, although Prophecy has attempted to identify important factors that could
cause actual actions, events or results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results not to be as
anticipated, estimated or intended. Prophecy undertakes no obligation to release publicly any
future revisions to forward-looking statements to reflect events or circumstances after the date of
this news or to reflect the occurrence o f unanticipated events, except as expressly required by
law.