Vital Metals has agreed to acquire stakes in the Kipawa and Zeus heavy rare earth projects in Quebec, Canada, from Quebec Precious Metals (QPM), for $6.37m (C$8m).
Under the binding term sheet signed between the parties, Vital Metals will purchase a 68% legal and beneficial interest in the Kipawa exploration project, located 50km from Temiscaming.
It will also acquire QPM’s rights, title and interest in the joint venture agreement with Investissement Québec (IQ), pertaining to the Kipawa project.
IQ holds the remaining 32% stake in the Kipawa project.
Vital Metals will also buy a 100% legal and beneficial interest in the Zeus exploration project.
The acquisition is expected to complement Vital’s light rare earths operations at Nechalacho.
The deal consideration will be paid in six tranches, with the first C$150,000 deposit paid on the signing of the term sheet and another C$2.35m to be paid on the acquisition of the projects.
An additional C$2.5m will be payable on the first anniversary of the acquisition while a further C$1m each will be paid on the second, third, and fourth anniversaries of acquisition.
Vital Metals said that the acquisition of the projects would transform the firm into the only North American producer of both light and heavy rare earths.
QPM CEO Normand Champigny said: “We have been successful in our monetisation of our non-core assets since the creation of QPM in 2018. ”
The two projects have a total of 73 claims spread over a 43km² area. They are located in the Grenville geological province, approximately 55km south of the geological contact with the Superior geological province.
The Kipawa project has a mineral resource estimate of 15.5 million tonnes (Mt) of eudyalite at 0.434% total rare earth oxide (TREO) and 0.873 ZrO₂ 2, 6.3Mt of mosandrite at 0.391% TREO, 1.018% ZrO₂, 5.1Mt of britholite at 0.286% TREO, 0.944% ZrO₂.
It has a proven and probable reserve estimate of 19.8Mt at 0.411% TREO.
Vital Metals said that the Kipawa deposit is defined by three enriched horizons within the Syenite Complex primarily comprising heavy rare earth oxides.
At the Zeus project, a total of 12 heavy rare earth showings were identified. Some of these contain niobium and tantalum.