Essex Minerals Inc. (TSX-V:ESX) has said it is pursuing its corporate strategy to acquire precious metal royalty and income streams, having signed letters of intent (LOI) on projects in South Africa and Peru, and also revealed the appointment of a new president.
The company also noted that its Queensland, Australia, gold and precious metals exploration projects are advancing with follow-up exploration planned to be funded by either joint venture expenditure or a spin-out in order to realise non-dilutive value for shareholders on the company's investment to date.
In South Africa, Essex said it has signed an LOI to earn up to a 60% interest in two potentially large battery metal (vanadium) projects. The projects are located in the prolific Bushveld Geological Complex within a known mineral and vanadium-producing area within reach of proven processing plants, railway and road options and ports in Limpopo and Mpumalanga Provinces of South Africa.
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The Bushveld Complex Geology is well-known and richly endowed. Vanadium mineralisation occurs in vanadium-bearing titaniferous magnetite-rich layers that occur within the Upper Zone of the Rustenburg Layered Suite (RLS) of the Bushveld Complex. A total of 25 layers of cumulus magnetite are known to exist within the Upper Zone. The highest vanadium contents occur in the lowermost layers, which are characterised by grades of up to 2.0% V2O5. Most of the vanadium is present in the magnetite grains, where it substitutes for trivalent iron.
Four separate near-term potential exploration and mining targets with a total strike length of prospective targets approximately 8.5 kilometres (km) were identified from historical exploration work completed by Anglovaal in the 1970s and 1980s on the current Lagersdrift and Blinkwater project areas.
Under the LOI, Essex can earn up to 60% in the projects as follows:
- an initial 50% by spending $500,000 on exploration and other project-related expenditures
- acquire an additional 10% project interest from the vendor based on an independent valuation following the initial earn-in
Essex said it intends to conduct detailed project due diligence in the next 45 days prior to entering into a definitive agreement.
Mallay Silver Mine LOI
Essex has also entered into an LOI with Premier Silver Corp to negotiate a royalty purchase or other property-level investment in the Mallay mine in Peru.
The Mallay mine is a five-hour drive north of Lima and is 3 km from the community of Mallay. The existing 600 tonne-per-day plant was constructed and then operated between 2012 and 2018 by Compania de Minas Buenaventura S.A.A. and has been on care and maintenance since. The mine produced 17.9 million ounces of gold equivalent through 400 metres vertical, prior to being put on care and maintenance in 2018.
Essex said it continues to identify and investigate additional precious and base metal opportunities for direct project investments.
New President Appointed
Essex Minerals also announced that Rod Husband has been appointed as president of the company and added that Paul Loudon, the current president, has been appointed as its executive chairman.
Loudon welcomed Husband's appointment and said the company and shareholders would benefit from his extensive experience. Further, as Husband resides in Canada, he will be able to engage more directly with the company's shareholder base, Loudon added.
Husband is a professional geologist and economic geologist with over 35 years' experience in the junior resource and corporate finance sectors. His multidisciplinary experience has developed strong capabilities in evaluating mineral assets and determining their economic viability. He is well versed in project management principles: scope, budget, schedule, communication, quality and risk assessment to add value and produce optimum results.
He has served as director and officer of several junior Canadian public companies where he focused on their management and corporate development, including the evaluation, financing, exploration and development of several quality projects, and has successfully raised over $150 million for exploration and development across these companies, culminating in the discovery and development of a 3 million-ounce gold mine in China.
Husband is a founding partner of Cipher Research, conducting research and analysis on hundreds of companies and projects over the past six years, helping develop detailed valuation models used to assess prospective investments.
Contact the author at jon.hopkins@proactiveinvestors.com