Oracle Ridge. Image courtesy of Eagle Mountain Mining Limited.
Eagle Mountain Mining Limited (Eagle Mountain or the Company) has executed a binding agreement with Vincere Resource Holdings LLC (Vincere) to acquire its 20 per cent interest in Wedgetail Operations LLC, owner of the Oracle Ridge Copper Project in Arizona. Following completion, Eagle Mountain will own 100 per cent of Oracle Ridge through its wholly-owned US subsidiary companies Wedgetail Holdings LLC and Wedgetail Operations LLC.
The consideration for the purchase is the issue of 10 million fully paid ordinary shares in Eagle Mountain which are to be issued by 3 May 2021. The shares will be issued under the Company’s existing 15 per cent placement capacity in accordance with Listing Rule 7.1.
Key terms of the transaction
- Eagle Mountain will issue 10,000,000 fully paid ordinary shares to Vincere or its nominee.
- Vincere shall not dispose, sell or transfer its interest in any of the Eagle Mountain shares unless Vincere has provided to Eagle Mountain 30 days prior written notice of its intention to do so. During this time, Eagle Mountain or its representatives may facilitate a sale of these shares to another group.
- Existing agreements with Vincere in relation to the Oracle Ridge operations will be dissolved.
As part of the acquisition of Oracle Ridge in November 2019, the Company executed a secured note for US$6,423,000 repayable to Vincere over 10 years with no repayment due over the first 5 years.
The secured note is not affected by the acquisition of Vincere’s 20 per cent interest in Oracle Ridge and remains payable on the existing terms.
In commenting on the news, Eagle Mountain Chief Executive Officer, Tim Mason, said: “We believe this is a highly value accretive transaction for our shareholders at a time when copper prices are surging due to strong global demand and supply limitations.”
“The acquisition of Vincere’s 20 per cent interest in Oracle Ridge increases the Company’s JORC Resources by 81 million pounds of contained copper, but more significantly provides full exposure to the exploration potential at the Project. This potential includes multiple high-grade drilling intercepts outside the JORC resources along with large scale prospective areas underneath the Leatherwood granitic intrusive at OREX. The acquisition also enables a much simpler structure to progress Oracle Ridge through all phases leading to production.”
“Following completion, Vincere will become a shareholder in Eagle Mountain and will still benefit from exposure to Oracle Ridge along with other growth opportunities in the Company. I truly thank Vincere for their contribution to Oracle Ridge and we warmly welcome them as shareholders in Eagle Mountain,” Mr Mason added.
About Oracle Ridge
The Oracle Ridge Copper Mine is located less than a two-hour drive from Tucson, Arizona and only a half-hour from the mining town of San Manuel.
Eagle Mountain outlines that Oracle Ridge has:
- Significant exploration potential including multiple high-grade mineralised samples along 4 kilometres of mapped Leatherwood intrusive contact at OREX
- Strong drilling results since September 2020 outside the JORC Resources
- Existing JORC resources of 12.2 million tonnes at 1.51 per cent copper (Cu), 16.3 grams per tonne (g/t) of silver (Ag), 0.19 g/t of gold (Au)  for 184 kilotonnes (kt) of contained copper at a 1 per cent Cu cutoff grade
- Extensive existing infrastructure including 18 kilometres of underground development
 See Eagle Mountain’s ASX Announcement dated 14 December 2020 and Attachment 1 of today’s announcement here.