New Earth Resources has executed an option agreement with Northex Capital Partners to acquire the Red Wine rare earth project in Labrador, Canada.
The project consists of two non-contiguous mineral claims covering a total area of approximately 1,575 hectares (ha).
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The first claim of the Red Wine rare earth project is situated in the Central Mineral Belt (CMB) of Newfoundland and Labrador.
Spanning around 1,425ha, it lies approximately 110km north-east of Churchill Falls and roughly 20km east of the Orma Lake hydro access road, which connects directly to the Trans-Labrador Highway.
The project also includes a secondary non-contiguous claim around 9km to the north-east, adding approximately 150ha.
Under the terms of the agreement, New Earth Resources is obligated to issue a total of 4.5 million Class A common shares to Northex.
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By GlobalDataThe share issuance will occur in stages, with 1.25 million shares within ten business days of executing the agreement, an additional 1.5 million shares on or before the first anniversary and a further 1.75 million shares on or before the second anniversary.
All shares issued will be contingent upon a four-month hold period in compliance with applicable securities laws.
In addition to the share issuance, New Earth Resources will grant Northex a 2% net smelter returns royalty on the Red Wine rare earth project.
Northex is an arm’s-length party to New Earth Resources, a mineral exploration company focused on acquiring and advancing both early-stage and advanced exploration assets.
Its flagship asset is the 100%-owned, past-producing Lucky Boy Uranium Property in Gila County, Arizona, US.
The company’s portfolio is complemented by three uranium claims in Saskatchewan, Canada, covering a combined 365ha.
