Nexcel Metals Enters into Option Agreement for the Burnt Hill Tungsten Project in New Brunswick
Executive Summary
- Nexcel Metals Corp. entered into an option agreement to potentially acquire up to a 58% interest in the Burnt Hill Tungsten Project in New Brunswick, Canada.
- The acquisition will be executed in four staged options involving cash payments and issuance of common shares, with total cash consideration up to $420,000 and share issuances totaling $930,000.
- The Burnt Hill property hosts a NI 43‑101 indicated resource of 1.76 Mt (open pit & underground) containing approximately 8.99 M lbs W, 162.9 k lbs Mo, and 244.6 k lbs Sn, plus inferred resources, underscoring its strategic importance for critical tungsten supply.
Key Details
- Option Structure:
- First Option (to 29.6% ownership): $170,000 cash (10% on signing, 90% within 45 days) + $330,000 common shares issued within 45 business days; plus $5,000 monthly payments until the first cash installment is satisfied.
- Second Option (to 38.3%): $25,000 cash + $200,000 common shares payable on or before the first anniversary of the Agreement.
- Third Option (to 46.4%): $25,000 cash + $200,000 common shares payable on or before the second anniversary of the Agreement.
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Fourth Option (to 58%): $200,000 cash + $200,000 common shares issuable any time after the second anniversary.
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Share Issuance Terms: All shares issued are subject to statutory hold periods and voluntary resale restrictions with staged release over a 36‑month period.
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Regulatory Condition: The Agreement is pending approval by the Canadian Securities Exchange.
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Joint Venture Trigger: Upon reaching a 51% interest, Nexcel will form a joint venture with Cadillac Ventures Inc. (Optionor) and Wyloo Ring of Fire Ltd. (Minority Owner).
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Minority Owner Position: Wyloo Ring of Fire Ltd.’s 42% stake remains unchanged unless a separate agreement is reached to acquire it.
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No Finder’s Fees: The transaction does not involve any finder’s fees; parties are arm’s‑length.
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Resource Summary (Burnt Hill Project):
- Indicated Resources: 1,761,000 t (open pit & underground) – 0.292% WO₃, 0.007% MoS₂, 0.008% SnO₂.
- Contained metal: 8.99 M lbs W, 162.9 k lbs Mo, 244.6 k lbs Sn.
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Inferred Resources: 1,520,000 t – 0.263% WO₃, 0.008% MoS₂, 0.005% SnO₂.
- Contained metal: 6.99 M lbs W, 160.7 k lbs Mo, 131.98 k lbs Sn.
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Strategic Importance: Tungsten is designated a critical mineral by Canada and the U.S., with growing demand for aerospace, defense, and high‑performance alloy applications. The Burnt Hill project provides a domestic source of this strategic material.
Notable Quotes
- “The Burnt Hill Project represents a strategically important domestic source of tungsten, a critical mineral essential to aerospace, defense, and advanced manufacturing,” – Hugh Rogers, CEO, Nexcel Metals Corp.