By Peter Kennedy
The Teledyne Mine portal near the historic Cobalt Mining Camp in northeast Ontario. Source: LiCo Energy Metals Inc.
LiCo Energy Metals Inc. [LIC-TSXV; WCTXF-OTCQB; 43W2-FSE] said Wednesday December 19 that it is hoping to raise $500,000 for exploration on its property portfolio from a non-brokered private placement offering of flow-through and non flow-through units. The proceeds from the flow-through units will be used to advance the company’s Teledyne and Glencore Bucke properties near Cobalt, northeast Ontario. Proceeds from non flow-through units will be used for the advancement and development of the company’s other mineral exploration properties and for general working capital purposes.
LiCo Energy Metals is a grassroots Canadian company that conducts exploration for metals used in the production of lithium-ion batteries. Exploration of these metals has become critical in the face of surging demand for electric vehicles, cell-phones, and many other modern devices.
The junior has four ongoing projects in mining friendly jurisdictions in Canada, the United States and Chile.
On Wednesday, Lico said it is proceeding with a non-brokered private placement offering of up to 2.7 million flow-through units and up to 4.0 million non flow-through units at $0.075 per unit, raising combined proceeds of $500,000.
Each flow-through unit and non flow-through unit is comprised of one common share of the company and one share purchase warrant. Each share purchase warrant is good to buy an additional share at an exercise price of 10 cents per share for two years from the date of closing.
LiCo recently announced an agreement with Surge Exploration Inc. [SUR-TSXV; CKVLF-OTCQB], giving Surge the option to earn a 60% interest in LiCo’s Glencore Buck and Teledyne cobalt properties.
Under the deal, Surge agreed to pay LiCo $240,000 and issue 1 million fully paid and non-assessable common shares to LiCo. In addition, Surge committed to incur $1.53 million in exploration expenditures.
Having completed its obligations to Glencore Canada Corp. under a mineral property acquisition agreement dated August 31, 2017, LiCo holds a 100% in interest in the mining rights for the Glencore Bucke property in Bucke Twp., 6 km east of Cobalt, Ontario.
The purchase agreement included a back-in provision, production royalty and an off-take agreement in favour of Glencore, which ranks as one of the world’s largest producers of cobalt. Glencore Canada is a subsidiary of Glencore Plc of Baar, Switzerland
Strategically, the Glencore Bucke property consists of 16.2 hectares and sits along the west boundary of LiCo’s 100%-owned Teledyne Cobalt Project. Teledyne covers the southern extension of the former producing 15 Vein on the past producing Aguanico Mine Property.
Historically, the Aguanico Mine produced 4,350,000 pounds of cobalt and 980,000 ounces of silver during the mining boom of the early 1900s.
LiCo is led by President and CEO Richard Wilson, who has been in the mining and natural resource industry for over 20 years. Since 2006, he has been President of Regent Ventures Ltd. [RGVNF-OTC], a company that is engaged in the acquisition, exploration, and development of resource properties. Currently, Wilson serves as Director, President and CEO of Nevada Energy Metals Inc. [BFF-TSX].
LiCo shares eased 11% or $0.01 to trade at $0.08 on Wednesday. The stock is trading in a 52-week range of $1.90 and $0.08.
Aside from the Ontario properties, Lico has an option agreement whereby the company may earn un undivided 100% interest, subject to a 3% net smelter return royalty, in the Black Rock Desert Lithium Project in the southwest Black Rock Desert, Washoe County, Nevada.
The asset portfolio also includes the Purickuta Project in Chile. It covers 160 hectares and is one of the few “exploitation concessions” granted within the Salar de Atacama, which is home to 37% of the world’s lithium production. The property is contained within an existing exploitation concession owned by Sociedad Quimica y Minera (SQM), and lies 3 km north of the exploration concession of CORFO (the Chilean Economic Development Agency).
About 22 km southeast of the Purickuta Concession, both SQM and Albemarle [ALB-NYSE] have large scale production facilities within the CORFO concession.
These two facilities collectively produce over 62,000 tonnes of lithium carbonate equivalent annually and account for 100% of Chile’s current lithium output.
Salar de Atacama is a salt flat encompassing 3,000 km2 (measuring 100 km long and 80 km wide). The salar possesses a very high grade of both lithium and potassium. It has a high rate of evaporation and extremely low rainfall, characteristics that make Atacama’s finished lithium carbonate easier and cheaper to produce than its peer group globally.