VANCOUVER (miningweekly.com) – Canadian project developer Prophecy Development Corp has agreed to acquire rights to a fourth vanadium project – its second this month.
The Vancouver-based project developer has entered a binding letter of agreement with Fairmont Resources to acquire the fully permitted Buttercup iron/titanium/vanadium project, in Quebec.
Spurred by hawkish comments earlier this year by mining mogul and financier Robert Friedland, Prophecy chairperson John Lee has been driving the company’s aggressive expansion into vanadium. Prophecy has mining and energy projects in Mongolia, Bolivia and Canada.
Under the terms of the proposed transaction, Prophecy will acquire the claims and a lease – which constitute the Buttercup project – by paying C$1-million on closing, half of which can be paid at Prophecy’s discretion in scrip, and a further C$500 000 due on the first-year anniversary date of the closing date, also subject to half being payable in scrip.
In 1964, the Bersimis Mining Company calculated a historical “drilled tonnage” on lens ‘A’ and lens ‘B’, located within the property. Both lenses, where drill-tested, were found at a relatively shallow depth of between 5 m and 154 m below surface.
The property has a historical indicated resource estimate of 2.78-million tons grading 48.4% iron, 18.9% titanium oxide and 0.67% vanadium pentoxide in lens 'A'. Lens 'B' has a historical indicated resource of 758 828 t grading 49.39% iron, 19.07% titanium oxide and 0.64% vanadium pentoxide.
In December 2014, the Ministère du Développement durable, de l’Environnement et des Parcs issued the Buttercup project with a certificate of authorisation, which allows aggregate production from the property of 300 000 t/y.
Fairmont completed site clearing and started the first blast at the Buttercup project in April 2015. However, further mining activities were curtailed on the back of falling prices in certain metals and aggregates, all of which have since rebounded from lows during the 2015/16 period, Prophecy advised.
Prophecy has started discussions with several potential dense aggregate buyers and expects to start production by the end of 2017, should commercial terms be reached with an offtaker.