Stuhini Exploration Ltd (TSX-V:STU) has exercised its option to acquire a 100% interest in the Ruby Creek project in British Columbia, the company announced.
The move is pursuant to an option deal from 2019 between Stuhini and Global Drilling Solutions Inc, which allowed the company to acquire a 100% interest by issuing 7.3 million common shares and paying $1.06 million in cash over a four-year span.
Stuhini had previously issued just over 5.5 million common shares and paid $420,000, and the company’s board unanimously decided to accelerate the final cash and stock payments, which was done on Monday.
“This is a milestone event for Stuhini given the potential of the property and the leverage we believe it provides on the molybdenum space,” CEO Dave O'Brien said in a statement. “...[W]e believe that it positions the company more favourably to search for a potential suitor or strategic partner.”
The price of molybdenum, based on the LME Platts Molybdenum futures prices, has more than doubled since Stuhuni first optioned the property, O'Brien noted.
"The board also considers that the remaining of 26,989 hectares of the property outside of the 2,466-hectare lease associated with the molybdenum deposit is prospective for base and precious metals and provides additional potential value to the property beyond the molybdenum resource," he added.
The company acknowledged that Global Drilling is beneficially owned by Barry Hanslit, a co-founder of the Stuhini and the vendor of the property. Immediately prior to the final option payment, Hanslit owned or controlled 6.8 million shares approximately 15.2% of the shares outstanding. After the payment, he owns or controls more than 8.5 million shares, good for 18.4%.
Stuhini Exploration is a Canadian precious and base metals exploration company focused on the exploration and development of high potential mineral assets in Western Canada. The company’s flagship Ruby Creek project sits in the heart of the Atlin Gold camp and is host to the historic Adanac molybdenum deposit which is road accessible and has a mines act permit in place.
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