Origen Resources signs LOI for Brazilian REE project

Executive Summary

• Origen Resources Inc. has signed a Letter of Intent (LOI) to acquire a 90% interest in a prospective rare earth elements (REE) project located in Piaui state, Brazil.
• The acquisition involves a 3,978-hectare claim package with potential for a district-scale footprint, including a right of first refusal on five additional exploration concessions.
• Preliminary sampling indicates REE mineralization, with one sample grading 1.61% TREO (excluding Y) and others ranging from 0.19% to 0.32% TREO, suggesting potential for both phosphate-concretion and ion adsorption clay deposit (IACD) models.

Key Details

• Transaction Structure: Origen will acquire a 90% interest in the project following a positive due diligence outcome and execution of a definitive agreement.
• Upfront Consideration: Origen will pay $50,000 USD and issue 2,000,000 shares to the vendor.
• Earn-in Requirements: Within two years of the due diligence period completion, Origen must incur $1,000,000 in exploration expenditures.
• Future Equity Issuance: After the two-year period, Origen will issue shares equal to 15% of its outstanding shares (including the initial 2,000,000 shares) and grant the vendor a seat on the board of directors.
• Due Diligence Timeline: An exclusive 150-day due diligence period has been granted, with a definitive agreement required no later than 180 days from the LOI signing.
• Property Details: The claim package totals 3,978 hectares in two separate parcels in Piaui state, northeastern Brazil. It is underlaid by Devonian Itaim and Pimenteira formations known for phosphate concretions with elevated REE and uranium levels.
• Sampling Results: Laboratory analysis by SGS Societe Generale de Surveillance Samin showed one sample at 1.61% TREO (not including Y) and others between 0.19% and 0.32% TREO. HREE/LREE ratios ranged from 0.258 to 0.949.
• Deposit Models: Two models are being evaluated: REE plus uranium-enriched phosphate beds and the ion absorption clay deposit (IACD) model. IACD deposits account for over 80% of global heavy REE (HREE) supply.
• Right of First Refusal: The vendor grants Origen the right of first refusal on five other analogous exploration concessions in Piaui state.
• Qualified Person: John Harrop, PGeo, of Coast Mountain Geological Ltd., supervised the scientific and technical disclosure.

Notable Quotes

• "We see this opportunity as a particularly good fit with the experience of our exploration team and an in-demand target that can be evaluated quickly. Early stage, impactful acquisitions have been a key to our success in the past and we are excited to initiate the Due Diligence work on this project in the coming weeks," states Gary Schellenberg, chief executive officer and director.