Historic Eagle Gold Mine Subject of Latest Property Transaction by Globex Mining Enterprises Inc.
So far, in 2021 Globex Mining Enterprises Inc. (CA: GMX – $1.07 & US: GLBXF – $0.88 & GER: G1MN – €0.73) has achieved some significant property transactions. The Company is continuing this trend as it has now vended the Eagle Gold Mine to Maple Gold Mines Ltd. [MGM]. The transaction is valued at $1.2 million and in addition, Globex retains a royalty on the project.
Located in Joutel township, Quebec, the 77-hectare Eagle Gold Mine is highlighted by a formerly producing mine. The project includes a historical gold resource estimated at more than 277 thousand tons with an average grade of 5.83 g/t. While significant quantities of gold were produced at Eagle Gold, attractive exploration potential was demonstrated in 2014 as new gold zones were outlined through drilling work.
Under the terms of the agreement, Maple shall issue to Globex a total of $600,000 in cash plus shares of Maple valued at $600,000, scheduled during a 5-year term of payments. Maple also commits to fund at least $1.2 million in exploration expenditures at the property. Moreover, Globex retains a 2.5% GMR on the project.
Maple Gold Mines is a successful junior mining company that is already active in the district through a JV in partnership with senior miner Agnico-Eagle Mines Ltd. This deal creates added incentive to build on the gold resources at the Eagle Mine, and perhaps the potential for the resumption of mining activity on the historic project. If so, the retained royalty held by Globex will create additional shareholder value on the back end of this deal.
Acquisition of Private Company Secures Royalties Held on Properties Controlled by Globex
In a second important transaction, Globex acquired Rockport Mining Corp., a private holding company that owned two royalty interests held against properties owned by Globex. In effect this deal represented a follow up to previously completed transactions involving Rockport. Globex acquired the Devil’s Pike gold property from Rockport in January 2016. Rockport retained a royalty on Devil’s Pike that could be purchased for $500,000 cash as part of the terms of that deal.
In February 2021, Globex acquired the Bald Hill antimony deposit from Rockport. Rockport retained a 1% Net Smelter Royalty against the Bald Hill claims.
With the purchase agreement to acquire Rockport, Globex may now retire the combined royalties held against these two properties. The arrangement also transfers existing contractual rights that enable access to the property holdings. This will provide an easier path to complete surveys and future drilling programs. Meanwhile the amalgamation of Rockport will allow Globex to carry forward non-capital losses that will reduce tax liabilities payable by the Company. The exact amount of the carry forward wasn’t mentioned, so we will have to wait until the next quarterly financials are filed to know.
A final benefit related to Bald Hill was that Globex was awarded $20,000 by the New Brunswick Exploration Assistance Program that will contribute towards future exploration activity at the property.
Additional Updates Regarding Third-Party Activity of Interest to Globex Shareholders
This week, Class 1 Nickel and Technologies Ltd. [NICO] reported that it has made a discovery of massive sulphide mineralization at its Somanike Project in Quebec on Globex royalty claims. Assay results were presented following a winter drilling program at the property. The results confirmed multi-meter intervals of nickel sulphide mineralization. One high-grade section of 0.80m with an average grade of 1.82%Ni was highlighted within a larger section of 4.2m bearing an average of 0.84% nickel.
Several years ago, Globex acquired a number of claims adjoining and to the south of the historic Marbridge Nickel Mine. NICO acquired the property in February of this year and launched exploration work. The discovery by Class 1 is located within 1 kilometer of the historic Marbridge Nickel Mine workings. This activity advances the property further along the value curve, enhancing the prospect that mining activity may resume within the property area in the future. Globex retains a 2% GMR on the claims.
In other news, Excellon Resources [EXN] has commenced drilling smoothly at the first of four priority targets of the 12,000 metre diamond drilling program at the Silver City Project in Saxony, Germany. A second drill rig will soon be added to the program.
The Silver City Project was mined for high-grade silver from the 11th until the late 19th century, when Germany left the silver standard in 1873 and the gold:silver ratio collapsed. Records from the project indicate high-grade silver production over substantial widths throughout the district. Excellon has embarked on the first modern day exploration program focused on precious metals. Globex retains a Gross Metals Royalty (GMR) of 3% on all precious metals production at Silver City, and a 2.5% on all other metals.
Last week, Canada Silver Cobalt Works Inc. [CCW] issued an update on plans to complete exploration work at several Quebec properties. Among these, the Graal-Nourricier-Lac Suzanne property is slated for drilling work to commence with permitting in hand. The total combined property area spans 5,223 hectares. Nearly a quarter of the land package was consolidated by CCW following an option deal with Globex in February of this year. As part of this transaction, Globex retains a 2% Gross Metal Royalty on these claims.
The drill program will follow up on airborne geophysical surveying. Interpretation of the program data identified magnetic anomalies that represent attractive targets for nickel sulphide mineralization in the pending round of drilling. The property is considered among the most promising of the Quebec holdings controlled by Canada Silver Cobalt Works.
The Eagle Gold Mine transaction represents yet another demonstration of the effective strategy to build shareholder value. Globex secured ownership of the land package including this historic gold mine for a minimal cost through staking. Advanced gold projects now command premium values. The deal with Maple Gold is structured to generate an immediate capital gain, while ensuring that exploration activity continues. Retained royalty leverage on the project may deliver a recurring revenue stream to Globex if mining resumes at the property. Meanwhile, the ownership of Maple Gold shares secured through the arrangement may also build value as the company executes its development strategy.
The purchase of Rockport also adds to the value of Globex property interests. However in this instance, the value proposition enabled by this deal is enhanced through cancelation of royalties held against current Globex properties. This serves to make these properties more attractive as acquisition targets for deals that may be arranged thereafter.
Battery metals are in demand as production of electric vehicles continues to increase. The race to outline and develop new deposits of these critical resources involves several current Globex royalty partners. Advancement of exploration activity has led to a flurry of news flow this month. One of the attractive elements to the royalty portfolio is that work is funded independently by partner companies and yet enhances the royalty value for Globex shareholders.
Globex controls an exceptional suite of property interests that is among the largest in the entire resource sector. The benefit of this superb portfolio of property and royalty holdings has been illustrated yet again. Smallcaps Recommendation: BUY.
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