Mich Resources Enters Into Definitive Agreements To Acquire Advanced Copper Exploration Project In Peru Via Reverse Takeover
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MICH RESOURCES LTD.
SUITE 3123 – 595 BURRARD STREET
VANCOUVER, BC V7X 1J1
TEL: 604-609-6110
MICH RESOURCES ENTERS INTO DEFINITIVE AGREEMENTS TO ACQUIRE
ADVANCED COPPER EXPLORATION PROJECT IN PERU VIA REVERSE TAKEOVER
November 8, 2021 CSE – MICH
Vancouver, British Columbia – Mich Resources Ltd. (CSE – MICH) (the “Company”) is pleased
to announce that further to its news release dated July 30, 2021, the Company has entered into definitive
agreements (the “Definitive Agreements”) with each of Pembrook Copper Corp. (“Pembrook”) and
Minera Andina de Exploraciones SAA (“Minandex”) for the acquisition of the advanced stage Pecoy
exploration copper project (the “Pecoy Project”) located in Peru (the “Transaction”).
About the Pecoy Project
The Pecoy Project is an advanced exploration copper project located one hundred and fifty kilometres
northwest of Arequipa, within the Cretaceous Copper Porphyry Belt of Peru, host to the Zafranal Cu
porphyry (Teck Resources Limited and Mitsubishi Materials Corporation) located approximately 100
kilometers to the southeast of the project.
The Pecoy project is located within the Peruvian coastal desert region which grades into the Atacama
desert further south in Chile. Topography within the project area ranges from 800m at the Rio Ocoña,
to slightly more than 4,000m at the highest ridges. Within the area of mineralization, the relief ranges
from 1650m to 2200m. There is no infrastructure in the immediate project area, but water is available
from the Rio Ocoña delta some 8 km to the west, and power is available from the national grid 100 km
from site. The site also has excellent road access to a number of nearby seaports for shipping of
concentrates.
The combined Project area consists of approximately 13,300 hectares. Exploration on the Property
dates back to 2009, and consists of 48,500m of diamond drilling in 121 drill holes completed by
previous operators including Pembrook. The project database consists of 1,222 downhole surveys, and
23,210 assays. The average drill spacing is about 118m in the main mineralized zone on the Pembrook
property, and 80m on the Minandex (Ocaña) side. The project database also includes quality control
data including blanks, standards and duplicates.
In 2018 Pembrook engaged Micon International to prepare a Canadian National I nstrument 43-101
compliant Technical Report and mineral resource estimate, however as a non -reporting Issuer the
report was never filed on SEDAR. The 2018 Technical Report considers 2 mining scenarios: the first
being a pit constrained to the Pembrook owned concessions only, and the second assuming the adjacent
Minandex (Arirahua, formerly named Ocaña ) ground is available for pit expansion excluding any
resources on the adjacent land.
These assumptions led to two historical mineral resource estimates as shown in Table 1 below.
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Table 1
Historical Inferred Mineral Resource Estimates as reported by Micon International (2018)
Scenario k Tonnes1 Cu (%) Mo(%) Au (ppm) Ag (ppm)
Pembrook Only 473,000 0.33 0.012 0.03 1.18
Pembrook/Ocaña 721,000 0.34 0.011 0.05 1.27
Notes:
1 – above a cutoff of 0.25% Cu
2 – based on the following metal prices – Cu ($3.25), Mo ($8.00), Au ($1,400), Ag ($20.00)
3 – based on the following metal recoveries - Cu (88-90%), Mo (70-72%), Au (40-54%), Ag (52-80%)
4 – the Qualified Person for this estimate is Christopher Keech, P.Geo. of CGK Consultants
5 – Effective date of the resource estimate is May 1, 2018
The Micon estimate was prepared to CIM (May 2014) standards for the reporting of mineral resources
and in accordance with CIM Best Practice Guidelines. The mineral resources were calculated in a 3-
dimensional block model using commercial mine planning software. Resource classifications were
assigned in accordance with CIM guidance.
The Company considers the Micon 2018 estimate to be a historical estimate since it was never filed on
SEDAR. It should be noted that a qualified person has not done sufficient work to classify the
historical estimate as current mineral resources, and the Company is not treating the historical estimate
as current mineral resources.
The Company intends to verify the historical estimate and has carried out a site visit to the Pecoy
Project as part of its work to complete an updated Technical report with current mineral
resources. Verification of the Micon 2018 resource is expected to be straightforward as the core and
pulps are available at the Pecoy site, the drilling database is available along with original surveys and
assay certificates.
The Pecoy Project to be acquired by the Company is comprised of all rights and title of the Pecoy
Project currently held indirectly by Pembrook and Minandex. Additionally, Minandex is the owner of
certain lands adjoining the Pecoy Project which will be optioned to the Company concurrently with
the closing of the Transaction.
Transaction Details
The Transaction will constitute a reverse take -over of Mich when completed. The Company intends
on seeking approval for the listing of the Company’s shares on the TSX Venture Exchange (the
“Exchange”) and concurrent voluntary delisting of the Company’s shares on the Canadian Securities
Exchange (the “CSE”).
As consideration for Pembrook and Minandex’s interests in the Pecoy Project, the Company will pay
the amount of USD $2,000,000 and issue 121 million common shares of the Company to the
shareholders of Pembrook and to Minandex. As finders fees, the Company will issue 6.4 million shares
to UMS Projects LP, as well as and aggregate 2.6 million shares to Fiore Management & Advisory
Corp. and Winchester Securities Corp.
Pursuant to the Definitive Agreements, completion of the Transaction is subject to a number of
conditions, including but not limited to: (i) the approval of all regulatory bodies having jurisdiction in
connection with the Transaction ( including Exchange approval ); (ii) completion of a subscription
receipt financing for minimum aggregate proceeds of $15,000,000 (the “ Financing”); and (iii)
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approval of the shareholders of Pembrook, and if required, the Company’s shareholders. There can be
no assurance t hat the Transaction will be completed as proposed or at all. The Company intends on
applying for an exemption from any Exchange sponsorship requirements.
It is anticipated (and without taking into account the Financing), that Minandex and the shareholders
of Pembrook will hold approximately 70% of the approximately 173 million common shares of the
Company (excluding dilutive securities) following closing of the Transaction (the “Resulting Issuer”).
Upon completion of the Transaction, the Resulting Issuer will continue to carry on the business of
exploration and development of the Pecoy Property under the Company’s existing name or such other
name as may be approved by the board of directors of the Resulting Issuer and the stock exchange.
Trading of the common shares of the Company has been halted, and will remain halted until closing
of the Transaction which is currently targeted for December, 2021.
Further details of the Transaction and related transactions, including the proposed executi ve
management and board of directors of the Resulting Issuer will be disclosed in future news releases.
The Qualified Person responsible for the technical content in this release is Dr David Stone, P.Eng., an
independent consultant to the Company.
About the Company
The Company is a British Columbia public company with a registered office at 25th Floor, 700 West
Georgia Street, Vancouver, BC, V7Y 1C3. The Company’s common shares are listed on the Exchange
under the trading symbol “MICH” and reporting in British Columbia and Ontario. The Company is
principally engaged in the acquisition and exploration of mineral properties.
About Pembrook
Pembrook is a British Columbia private company with a head office located at 500-666 Burrard Street,
Vancouver, British Columbia. Concurrently with or prior to the closing of the Transaction, Pembrook
will divest itself of certain assets not related to the Pecoy Project.
About Minandex
Minandex is a Peruvian public company with a head office located at Calle Arnaldo Alvarado Degregori
#39, Surco, Lima, 33, Peru.
On behalf of Mich Resources Ltd.
“Mark T. Brown”
Chief Executive Officer
For more information, please contact:
Szascha Lim
CFO & Corporate Secretary
Tel: 604.609.6110
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Neither the Canadian Securities Exchange nor its Regulation Service Provider (as that term is defined in
the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Forward Looking Information
Certain statements and information herein, including all statements that are not historical facts, contain
forward-looking statements and forward-looking information within the meaning of applicable securities
laws. Such forward-looking statements or information include but are not limited to statements or
information with respect to: the proposed Transaction; the satisfaction of the conditions and closing of
the Transaction (including Exchange and shareholder approvals); transfer of the Pecoy Project to the
Resulting Issuer; and, general business and economic conditions. The foregoing list of assumptions is not
exhaustive.
Although management of the Company believe that the assumptions made and the expectations
represented by such statements or information are reasonable, there can be no assurance that forward-
looking statements or information herein will prove to be accurate. Forward-looking statements and
information by their nature are based on assumptions and involve known and unknown risks,
uncertainties and other factors which may cause actual results, performance or achievements, or industry
results, to be materially different from any future results, performance or achievements expressed or
implied by such forward-looking statements or information. These factors include, but are not limited to:
the Transaction may not close on the terms set forth herein, or at all; risks relating to the availability of
financing for the Resulting Issuer; risks relating to the receipt of all requisite approvals for the
Transaction, including the approval of the Exchange; risks associated with the business of the Company;
business and economic conditions in the mining industry generally; the supply and demand for labour
and other project inputs; changes in interest and currency exchange rates; risks relating to unanticipated
operational difficulties (including failure of equipment or processes to operate in accordance with
specifications or expectations, cost escalation, unavailability of materials and equipment, government
action or delays in the receipt of government approvals, industrial disturbances or other job action, and
unanticipated events related to health, safety and environmental matters); political risk and social unrest;
changes in general economic conditions or conditions in the financial markets; changes in laws
(including regulations respecting mining concessions); risks related to the direct and indirect impact of
COVID-19 including, but not limited to, its impact on general economic conditions, the ability to obtain
financing as required, and causing potential delays in the supply of equipment and services; and other
risk factors as detailed from time to time.
The Company does not undertake to update any forward-looking information, except in accordance with
applicable securities laws.
Reader Advisory
Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the
Transaction, any information released or receiv ed with respect to the Transaction may not be accurate or complete
and should not be relied upon. Trading in the securities of the Company and Resulting Issuer should be considered
highly speculative.
Neither the CSE or the Exchange has in no way passed upon the merits of the proposed Transaction and has neither
approved nor disapproved the contents of this press release.
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This news release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in the United
States. The se curities have not been and will not be registered under the United States Securities Act of 1933, as
amended (the “ U.S. Securities Act ”) or any state securities laws and may not be offered or sold within the United
States or to U.S. Persons (as defined under the U.S. Securities Act) unless registered under the U.S. Securities Act
and applicable state securities laws or an exemption from such registration is available.