American Lithium Corp. (“
American Lithium” or the
“
Company”) (TSX-V:LI | OTCQB:LIACF |
Frankfurt:5LA1) is pleased to announce that after a review by the
Company, along with its advisors, it has made the decision to
pursue a “spin-out” of its Macusani Uranium Project (the
“
Macusani Project”) into an independent public
company (the “
Transaction”).
The Company views a spin-out of the Macusani
Project into a stand-alone vehicle as the preferred route to
generate value for American Lithium and its shareholders from the
continued development of this large-scale uranium project.
The re-structuring of the Macusani Project’s
ownership is well advanced, and the Company anticipates being in a
position to finalize the terms of the Transaction in early
2023.
American Lithium believes that its current share
price does not fully recognize the value of the Macusani Project
and that by structuring an appropriate “spin-out” into an
independent, uranium focused vehicle, the Company and its
shareholders will benefit from unlocking the value of this project.
Additionally, this will allow American Lithium to concentrate its
efforts on advancing its two premier lithium projects, TLC in
Nevada and Falchani in Peru.
Nuclear energy is experiencing a robust
renaissance because it clearly stands out as the planet’s cleanest,
most cost-effective and reliable form of 24/7 dispatchable energy.
Accordingly, the world’s premier uranium deposits are attracting
more and more global interest.
Highlights of the Macusani
Project
- Large NI 43-101 mineral resource
Cut-Off (75ppm) |
Tonnes (Mt) |
Grade (ppm U₃O₈) |
Contained lbs (Mlbs U₃O₈) |
Indicated |
95.2 |
248 |
51.9 |
Inferred |
130.0 |
251 |
72.1 |
Note: ~30% of Total Mineral
Resources at the Macusani Project are impacted by the ongoing
regulatory dispute surrounding the ownership of 32 of the 169
concessions making up the Project.
- NI 43-101 preliminary
economic assessment in 2016 with the following highlights:
- NPV8: US $603M, IRR 40.6% and 1.8
years payback at US $50/lb U₃O₈
- Large Scale. Avg. production ~6Mlbs
U₃O₈ / yr over a 10-year mine life
- PEA Mine Plan Resource: ~68.8Mlbs
U₃O₈ at 289ppm (circa 55% of existing resource)
- Low Cost: US$17/lb Life of Mine
cash cost and ~US$18/lb AISC
- Low CapEx: ~US
$300M initial capital
Note: For both mineral resource
Table and PEA Highlights presented above, refer to “Macusani
Project, Macusani, Peru, NI 43-101 Report – Preliminary Economic
Assessment” prepared by Mr. Michael Short and Mr. Thomas Apelt, of
GBM Minerals Engineering Consultants Limited; Mr. David Young, of
The Mineral Corporation; and Mr. Mark Mounde, of Wardell Armstrong
International Limited dated January 12, 2016 filed on SEDAR. A PEA
is preliminary in nature and includes inferred mineral resources
that are considered too speculative geologically to have the
economic considerations applied to them that would enable them to
be categorized as mineral reserves. There is no certainty the
results of the PEA will be realized. Mineral resources are not
mineral reserves and do not have demonstrated economic viability.
There is no certainty that any mineral resource will be converted
into mineral reserve.
- Ability to further improve
robust economics
- Recent processing work has shown
ability to double head grades through simple
scrubbing/screening
- preconcentration has the potential
to significantly increase throughput/life of mine
- Australia Nuclear Science and
Technology Organisation continues uranium extraction and
precipitation test work to optimize extraction rates while further
reducing acid consumption
- Planned drilling will focus on
expansion and reclassification of resource
- Near term milestones –
drilling, updated PEA and move into feasibility targeted for 2023
in stand-alone vehicle
- Strategically located approximately 25 kilometres from
the Company’s Falchani Project
Simon Clarke, CEO of American
Lithium, stated, “We are pleased to be able to begin the
process of spinning-out this large-scale and advanced-stage uranium
project in such a way as to benefit the Company and all of our
shareholders.
The Macusani Project comprises one of world’s
largest undeveloped uranium projects whose ease of extraction and
“near surface” characteristics position it with the potential to be
one of the lowest cost sources of uranium globally. With mounting
concerns around energy security and climate change, Macusani is
strategically located in the Americas, and we believe it can play a
large role in the transition to zero emission base-load electricity
generation that the world requires. However, we believe it needs to
be in a stand-alone public company to be able to fully realize its
potential and to provide appropriate value to our
shareholders.”
Proposed “Spin-Out” Transaction
It is anticipated that the Transaction will
include the transfer of a stand-alone Peruvian subsidiary holding
the Macusani Project along with its uranium focused concessions, to
an existing publicly traded company. The consideration for such
transfer is expected to be the common shares in the capital of that
public company. American Lithium then intends to distribute all, or
the majority, of such common shares to its existing shareholders on
a pro rata basis.
As part of the Transaction, American Lithium
will coordinate the appointment of management and an independent
board for the new company which will also benefit from the
relationships and expertise of American Lithium’s operating team in
Peru who will continue to be involved in developing the Macusani
Project. The completion of the Transaction will be subject to,
amongst other things, entering into definitive documentation on
acceptable terms with an appropriate existing public company, and
also the receipt of all required regulatory and shareholder
approvals. The Company will provide further information regarding
the proposed Transaction and the anticipated timelines as it
becomes available.
Incentive Securities
As previously announced by the Company in its
news release of October 4, 2022, the Company had granted an
aggregate of 150,000 incentive stock options and 150,000 restricted
share units to Carsten Korch, a newly appointed director of the
Company. The Company clarifies that the incentive stock options
vest over a period of twelve months and are exercisable at a price
of $2.14 until October 4, 2027, and the restricted share units vest
on October 4, 2024.
Qualified PersonTed O'Connor,
PGeo, Executive Vice-President of American Lithium and a qualified
person as defined by National Instrument 43-101 Standards of
Disclosure for Mineral Projects, has reviewed and approved the
scientific and technical information contained in this news
release.
About American
LithiumAmerican Lithium, a member of the TSX Venture 50,
is actively engaged in the development of large-scale lithium
projects within mining-friendly jurisdictions throughout the
Americas. The Company is currently focused on enabling the shift to
the new energy paradigm through the continued development of its
strategically located TLC lithium claystone project in the richly
mineralized Esmeralda lithium district in Nevada, as well as
continuing to advance its Falchani lithium and Macusani uranium
development-stage projects in southeastern Peru. Both Falchani and
Macusani have been through robust preliminary economic assessments,
exhibit strong significant expansion potential and enjoy strong
community support. Pre-feasibility work has now commenced at
Falchani.
For more information, please contact the Company
at info@americanlithiumcorp.com or visit our website
at www.americanlithiumcorp.com for project update videos and
related background information.
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On behalf of the Board of Directors of
American Lithium Corp.
“Simon Clarke”
CEO & Director
Tel: 604 428 6128
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this press release.
Cautionary Statement Regarding Forward
Looking InformationThis news release contains certain
forward-looking information and forward-looking statements
(collectively “forward-looking statements”) within the meaning of
applicable securities legislation. All statements, other than
statements of historical fact, are forward-looking statements.
Forward-looking statements in this news release include, but are
not limited to, statements regarding the ability to appeal the
judicial ruling, and any other statements regarding the business
plans, expectations and objectives of American Lithium.
Forward-looking statements are frequently identified by such words
as "may", "will", "plan", "expect", "anticipate", "estimate",
"intend", “indicate”, “scheduled”, “target”, “goal”, “potential”,
“subject”, “efforts”, “option” and similar words, or the negative
connotations thereof, referring to future events and results.
Forward-looking statements are based on the current opinions and
expectations of management are not, and cannot be, a guarantee of
future results or events. Although American Lithium believes that
the current opinions and expectations reflected in such
forward-looking statements are reasonable based on information
available at the time, undue reliance should not be placed on
forward-looking statements since American Lithium can provide no
assurance that such opinions and expectations will prove to be
correct. All forward-looking statements are inherently uncertain
and subject to a variety of assumptions, risks and uncertainties,
including risks, uncertainties and assumptions related to: American
Lithium’s ability to achieve its stated goals; risks and
uncertainties relating to the COVID-19 pandemic and the extent and
manner to which measures taken by governments and their agencies,
American Lithium or others to attempt to reduce the spread of
COVID-19 could affect American Lithium, which could have a material
adverse impact on many aspects of American Lithium’s businesses
including but not limited to: the ability to access mineral
properties for indeterminate amounts of time, the health of the
employees or consultants resulting in delays or diminished
capacity, social or political instability in Peru which in turn
could impact American Lithium’s ability to maintain the continuity
of its business operating requirements, may result in the reduced
availability or failures of various local administration and
critical infrastructure, reduced demand for the American Lithium’s
potential products, availability of materials, global travel
restrictions, and the availability of insurance and the associated
costs; the judicial appeal process in Peru, and any and all future
remedies pursued by American Lithium and its subsidiary Macusani to
resolve the title for 32 of its concessions; risks regarding the
ongoing Ontario Securities Commission regulatory proceedings; the
ongoing ability to work cooperatively with stakeholders, including
but not limited to local communities and all levels of government;
the potential for delays in exploration or development activities
due to the COVID-19 pandemic; the interpretation of drill results,
the geology, grade and continuity of mineral deposits; the
possibility that any future exploration, development or mining
results will not be consistent with our expectations; risks that
permits will not be obtained as planned or delays in obtaining
permits; mining and development risks, including risks related to
accidents, equipment breakdowns, labour disputes (including work
stoppages, strikes and loss of personnel) or other unanticipated
difficulties with or interruptions in exploration and development;
risks related to commodity price and foreign exchange rate
fluctuations; risks related to foreign operations; the cyclical
nature of the industry in which American Lithium operates; risks
related to failure to obtain adequate financing on a timely basis
and on acceptable terms or delays in obtaining governmental
approvals; risks related to environmental regulation and liability;
political and regulatory risks associated with mining and
exploration; risks related to the uncertain global economic
environment and the effects upon the global market generally, and
due to the COVID-19 pandemic measures taken to reduce the spread of
COVID-19, any of which could continue to negatively affect global
financial markets, including the trading price of American
Lithium’s shares and could negatively affect American Lithium’s
ability to raise capital and may also result in additional and
unknown risks or liabilities to American Lithium. Other risks and
uncertainties related to prospects, properties and business
strategy of American Lithium are identified in the “Risks and
Uncertainties” section of Plateau’s Management’s Discussion and
Analysis filed on January 19, 2021, in the “Risk Factors” section
of American Lithium’s Management’s Discussion and Analysis filed on
January 29, 2021, and in recent securities filings available at
www.sedar.com. Actual events or results may differ materially from
those projected in the forward-looking statements. American Lithium
undertakes no obligation to update forward-looking statements
except as required by applicable securities laws. Investors should
not place undue reliance on forward-looking statements. Cautionary
Note Regarding Macusani Concessions Thirty-two of the 151
concessions held by American Lithium’s subsidiary Macusani, are
currently subject to Administrative and Judicial processes
(together, the “Processes”) in Peru to overturn resolutions issued
by INGEMMET and the Mining Council of MINEM in February 2019 and
July 2019, respectively, which declared Macusani’s title to 32 of
the concessions invalid due to late receipt of the annual validity
payments. In November 2019, Macusani applied for injunctive relief
on 32 concessions in a Court in Lima, Peru and was successful in
obtaining such an injunction on 17 of the concessions including
three of the four concessions included in the Macusani Uranium
Project PEA. The grant of the Precautionary Measure (Medida
Cautelar) has restored the title, rights and validity of those 17
concessions to Macusani until a final decision is obtained at the
last stage of the judicial process. A Precautionary Measure
application was made at the same time for the remaining 15
concessions and was ultimately granted by a Court in Lima, Peru on
March 2, 2021 which has also restored the title, rights and
validity of those 15 remaining concessions to Macusani, with the
result being that all 32 concessions are now protected by
Precautionary Measure (Medida Cautelar) until a final decision on
this matter is obtained at the last stage of the judicial process.
The favourable judge’s ruling confirming title to all 32
concessions from November 3, 2021 represents the final stage of the
current judicial process. However, this ruling has recently been
appealed by MINEM and INGEMMET. American Lithium has no assurance
that the outcome of these appeals will be in the Company’s
favour.
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