Victory Resources Corporation (CSE:VR) (OTCMKTS:VRCFF) (FRA:VR62) said it has acquired, in an arms-length transaction, the Smokey Lithium Project in Nevada.
The company noted that the Smokey property, consisting of 350 claims covering 7,000 acres, is located in a prolific region for lithium clay deposits, and is surrounded by projects being developed by Noram, Cypress, and American Lithium, to name a few.
The Smokey project is also adjacent and contiguous to a property owned by Jindalee Resources Limited (ASX:JRL), which has demonstrated lithium grades as high as 930 parts per million (ppm) in outcropping clay that possibly trends northwest onto the Smokey claims.
Shares of Victory Resources soared 375% higher to $0.38 in early Thursday trading on the Canadian Securities Exchange (CSE) following the announcement.
READ: Victory Resources shores up mining interests in North America, advances Loner Project in Nevada and Canadian assets
Under the terms of the agreement, Victory Resources will pay $178,500 in cash plus issue 1.5 million of its common shares, subject to exchange approval. Victory will also be responsible for paying annual Bureau of Land Management (BLM) fees of $57,750.
The property is subject to a net smelter royalty equal to a 2.0% royalty on revenues derived from the sale of lithium and other ores extracted from the project, although Victory has the right to buy one half (1.0%) of the royalty at any time for $1 million in cash.
As well, Victory Resources has agreed to pay the vendor $1 million in cash or common shares in four staged payments (90-day intervals), upon completion of a positive feasibility study prepared by Victory.
The company also holds an exclusive option to acquire an additional 350 claims in the project area surrounding the claims in Esmeralda County for a total of 7,000 additional acres. If exercised, Victory will issue a further 1.5 million of its common shares and pay $200 per claim and cover BLM and county filing fees.
Victory Resources is currently developing its existing projects including its recently optioned Loner property in Nevada adjacent to Goldbanks, its recently acquired properties, Hammond Reef South in Ontario adjoining Agnico Eagle’s Hammond Reef mine, and Lac Simard in Quebec within 20 kilometers of three operating gold mines including Agnico Eagle’s Goldex, Canadian Malartic mines and Eldorado Gold’s Lamaque mine.
Contact Sean at sean@proactiveinvestors.com