Cornerstone Metals Signs LOI to Acquire Carlin Vanadium Project
Cornerstone Metals Signs LOI to Acquire Carlin Vanadium Project
August 11, 2017 - Vancouver, British Columbia – Cornerstone Metals Inc. (TSX-V – CCC)
(“Cornerstone” o r t h e “Company”) is pleased to announce that it has entered into a non-
binding Letter of Intent (LOI) with Americas Gold Exploration I nc. (AGEI), a private Nevada
corporation, to acquire 100% interest in its underlying option agreement on the Carlin Vanadium
Project, Nevada. The Carlin Vanadium Project has one of the lar gest known primary vanadium
deposits in the U.S.A. The latest utility-scale battery storage technology to emerge on the
commercial market is the vanadium redox flow battery.
The Carlin Vanadium Project is located in Elko County 22km by r oad (14 miles) from the town
of Carlin, Nevada, and is comprised of 72 contiguous unpatented mineral claims totaling 461
hectares (1,140 acres). The Carlin Vanadium deposit was discove red by Union Carbide Corp.
(UCC) in the 1960’s, which completed surface mapping, trenching and 152 rotary drill holes in
11,133m (36,525 feet) of drilling. The average drill hole spaci ng was 60m (200ft) apart within
the more densely drilled areas.
By 1967, UCC completed a vanadium resource estimate that is not NI 43-10 1 compliant. In
April 2010, SRK Consulting (U.S.) Inc. reported an NI-43-101 compliant Inferred mineral
resource and Technical Report for EMC Metals Corp. on the depos it. Since the necessary work
to verify the 2010 estimate as current estimate under NI 43-101 has not yet been done by
Cornerstone’s Qualified Person, Paul Cowley, P.Geo., the 2010 e stimate should be considered
historic and not be relied upon so has not been reported here. Drilling to date indicates a zone of
mineralization approximately 55m (180 feet) thick striking nort h-south over 1,860m (6,100ft) in
length and dipping 5°-30° west averaging 760m (2,500ft) of down dip extent from surface.
Located along the western flank of the Pinon Range, the Carlin Vanadium deposit has been
interpreted to be a Syngenetic- type occurrence within the Paleo zoic-age Woodruff shale, host to
several other vanadium deposits in Nevada with similar characte ristics. The Syngenetic-type
occurrences are associated with b lack shales and are believed t o have formed by evaporation,
concentration and precipitation of vanadium from vanadium-rich seawater in a deep restricted
inland sea basin.
Paul Cowley, President and CEO comments ”As vanadium plays an i ncreasingly important role
as a component of batteries used in the Renewable Energy industry, the Carlin Vanadium deposit
with its apparent size, grade a nd location, provides our Compan y with a unique and strategic
entry into this promising sector.”
Proposed Assignment Transaction
AGEI currently holds an option to acquire 100% of the Carlin Va nadium Project from the third
party owner of the property. The LOI outlines the principal ter ms under which AGEI would
assign its interest to Cornerstone. Upon execution of a formal assignment agreement,
Cornerstone would assume all of t he optionee’s obligations set out in the 5 year underlying
option agreement, which include cash payments totaling US$75,00 0 and US$400,000 in work
commitments over 2.5 years. In addition to these commitments, a US$2 million payment would
complete the option exercise requirements, at which time Corner stone would acquire a 100%
interest in the project, subject to a 2% NSR in favour of the p roperty owner, which could be
bought out at the time of option exercise for US$4 million.
As set out in the LOI, in consideration for the assignment, Cor nerstone will pay AGEI total cash
payments of US$50,000 and issue to AGEI 2 million shares of Cor nerstone, in two tranches.
The LOI contemplates that Cornerstone will consolidate its shar e capital on a two old shares for
one new share (2:1) basis prior to execution of the formal assi gnment agreement. Consequently,
the consideration shares issuable to AGEI will be post-consolid ation shares. It will be a further
requirement of the assignment t hat Cornerstone produce a Prelim inary Economic Assessment
(PEA) on the project within 4 years. Once the underlying option agreement was fully exercised
by the Company, AGEI would be granted a 1.5% NSR which could be entirely bought out at any
time by Cornerstone for a total of US$3 million. Following the PEA, AGEI would receive
US$250,000/year in cash, or in cash and shares (50/50) at Corne rstone’s discretion, until
production. The post-PEA annual payments would be credited to t he NSR buy-out amount or to
any future NSR payments due to AGEI. A 60 day due diligence per iod has begun. The Company
will provide an update when due diligence is completed.
About Cornerstone Metals Inc.
Cornerstone’s objective is to advance exploration/development s tage copper, precious and
strategic minerals properties to production in the Americas. Th e Company’s Management and
Board Core Competence is in exploration, permitting, developmen t, construction, and operation
of mining projects.
Cornerstone owns 100% (subject to 1.5% NSR) of the West Jerome property, near Jerome,
Arizona, on the west side of Freeport McMoRan patented lands. The property, in a Volcanogenic
Massive Sulfide camp, is a high-gr ade, massive sulfide target l ocated 2.4 km south of the past-
producing United Verde (32 million tons grading 4.4% copper, 1.5 oz/t silver and 0.04 oz/t gold).
The West Jerome property has attractive untested drill targets.
Technical disclosure in this news release has been reviewed and approved by Paul Cowley,
P.Geo., a Qualified Person as defined by National Instrument 43 -101, and President and CEO of
the Company.
ON BEHALF OF CORNERSTONE METALS INC.
per:
“Paul Cowley”
CEO & President
For further information, please contact:
Paul Cowley
Tel: 604-340-7711
Email: [email protected]
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 information
Certain statements in this news release constitute "forward-lookin g" statements. These statements relate to future events or th e Company's future
performance and include the potential acquisitio n of the Carlin Vanadium project as desc ribed in the news release. All such sta tements involve
substantial known and unknown risks, uncertainties and other facto rs which may cause the actual results to vary from those expr essed or implied
by such forward-looking statements. In addition to other risks, the Company's potential acquisition may prove to be unsuccessfu l and the
Company may be unable to complete such transaction, whether bec ause due diligence was unsatisfactory or otherwise. Further, the Company
may not attract capital in the future to finance the transaction costs or obligations under the assignment, which could affect whether the
Company proceeds with the acquisition. Forward-looking statements involve sign ificant risks and uncertainties, they should not be read as
guarantees of future performance or results, and they will not nece ssarily be accurate indications of whether or not such resul ts will be achieved.
Actual results could differ materially from those anticipated due to a number of fa ctors and risks. Although the forward-lookin g statements
contained in this news release are base d upon what management of the Company believes are reasonable assumptions on the date of this news
release, the Company cannot assure investo rs that actual results will be consistent with these forward-looking statements. The forward-looking
statements contained in this press release are made as of the date hereof and the Company disclaims any intention or obligation to update or
revise any forward-looking statements whet her as a result of new information, future events or otherwise, except as required un der applicable
securities regulations.