Xplore Resources to Acquire 51% Interest in the Diamond Mountain Phosphate Project
June 7th 2022
Toronto, Ontario, Canada – June 7, 2022 - Xplore Resources Corp. (TSX-V: XPLR) (“Xplore or the “Company”), is pleased to announce that it has entered into a definitive agreement (the “Agreement”) to acquire a 51% interest in the Diamond Mountain phosphate project (“Diamond Mountain” or the “Project”) from Revival Gold Inc. (“Revival”). The Project is located approximately 30 kms north-east of Vernal, Utah. The remaining 49% interest is held by Utah Mineral Resources LLC. (“UMR”).
Diamond Mountain is a 547-hectare State Mining Lease (“State Lease”) that offers an existing measured and indicated resource estimated to be 26.8 million tonnes (“Mt”) averaging 19.67% P2O5 in addition to an inferred resource estimated at 23.1 Mt averaging 19.67% P2O5. The mineral resource estimate is supported by the Technical Report titled “Technical Report, Diamond Mountain Phosphate Project, Uintah County, Utah” authored by L.D.Henchel, P.Geo, P.G., with an effective date of September 11, 2014.
The Technical Report is available by clicking on link:
Technical Report, Diamond Mountain Phosphate Project, Uintah County, Utah
Diamond Mountain is strategically situated adjacent to Simplot Phosphates, LLC, a current producer of high-quality phosphate concentrates which are transported by pipeline to their fertilizer processing facility in Rock Springs, Wyoming where it is converted into various fertilizer products.
Phosphate mineralization at Diamond Mountain was originally identified by US Steel Corp. in the mid 1960s. US Steel completed 23 diamond drill holes in and surrounding the Diamond Mountain claims. In 2014, Revival (formerly Strata Minerals Inc.) completed 14 additional drill holes, most of which are collared within the acquired mineral lease. This drilling forms the basis of the mineral resource estimate described in the previously noted Technical Report. 100% of the currently identified mineral resource falls within the existing state mining lease which is administered by the State of Utah School and Institutional Lands Administration (“SITLA”) (Ref. Figure 1.0).
Terms of the Agreement:
Under the terms of the Agreement, which is subject to TSX Venture Exchange (the “Exchange”) approval, Xplore may acquire up to a 51% interest in the Diamond Mountain phosphate project and may be earned with the following terms.
- C$250,000 cash payment on closing of the transaction (“Closing”); and
- C$250,000 cash payment on the first anniversary of Closing; and
- Issuance to Revival of such number of common shares in the capital of Xplore (the “Payment Shares”) as is equal to 19.9% of Xplore’s issued capital upon completion of the financing as noted below; and
- Closing of the transaction is subject to the completion of a minimum C$5 million financing by Xplore. Further details of the financing will be announced by Xplore in a subsequent news release.
Closing of transaction is expected to be completed by the end of June 2022.
A financial advisory fee to an arms’ length party consisting of 2,000,000 shares of Xplore will be issuable by Xplore as consideration for introducing Xplore to Revival and for other financial advice provided in connection with the acquisition, upon completion of the purchase of Revival’s interest in Diamond Mountain and subject to the approval of the Exchange.
Wes Hanson, President and CEO of Xplore notes: “We are very pleased to have reached an agreement with Revival to acquire an initial 51% interest in the Diamond Mountain phosphate project. Our financial advisors suggest strong underlying fundamentals in phosphate supply and demand with projected long term demand growth of at least 2% per annum solely based on agricultural demand. This is one of the top ten undeveloped phosphate projects in the world that is not owned by a major fertilizer producer. Located in the state of Utah, in a resource-focused economic enclave where phosphate ores have been continuously mined since the 1960s made this a compelling acquisition to consider. We see an opportunity to rapidly and cost effectively convert the currently identified inferred resource to the measured and indicated classification through systematic exploration drilling. We believe Diamond Mountain offers both short and long term value creation for our shareholders, especially in light recent disruptions in global phosphate deliveries and a renewed increase in demand due to the resurgence of lithium-iron-phosphate “LFP” batteries for the burgeoning electric vehicle market.”
Issuance of the Payment Shares shall be subject to the receipt of regulatory approvals including, without limitation, the final approval of the Exchange.
Revival Gold acquired its 51% interest in Diamond Mountain for exploration expenditures totaling approximately C$1.2 million through a joint venture earn-in agreement with Utah Minerals resources LLC in December 2014.
Figure 1.0 – Current Mineral Resource – Diamond Mountain Project
About Xplore Resources (TSX-V: XPLR)
Xplore Resources is a Toronto based mining exploration company listed on the TSX Venture Exchange under symbol XPLR and is focused on the acquisition and development of mineral projects in the Americas. The Company is led by a highly experienced management team and is comprised of industry experts with executive and senior management experience in geology, banking, private equity, investor relations and law.
Mr. Wes Hanson, P. Geo., President & CEO of Xplore and registered in the Province of Ontario is the “Qualified Person” under National Instrument 43‑101 Standards of Disclosure for Mineral Projects ("NI 43-101") and is responsible for the technical contents of this news release and has approved the disclosure of the technical information contained herein.
Additional disclosure of the Company's financial statements, technical reports, material change reports, news releases and other information can be obtained on SEDAR at www.sedar.com.
ON BEHALF OF THE BOARD
“Wesley C. Hanson”
President & CEO
For further information, please contact:
Phone: +1 647-202-7686
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE
ANY SECURITIES REFERRED TO HEREIN WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO A U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT.
Notice on forward-looking statements:
Information set forth in this news release contains forward-looking statements. These statements reflect management's current estimates, beliefs, intentions, and expectations; they are not guarantees of future performance. Xplore cautions that all forward-looking statements are inherently uncertain, and that actual performance may be affected by a number of material factors, many of which are beyond Xplore's control. Such factors include, among other things: risks and uncertainties relating to Xplore's ability to complete the proposed Transaction; and other risks and uncertainties, including those to be described in the Filing Statement to be filed by Xplore on SEDAR.com. Accordingly, actual, and future events, conditions and results may differ materially from the estimates, beliefs, intentions, and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, Xplore undertakes no obligation to publicly update or revise forward-looking information.Back to Past News