Metal Energy Corp. (the “Company” or “Metal Energy”) (MERG:TSXV, MEEEF:OTCQB) is pleased to announce a next step in its growth, having entered into an arm’s length asset purchase agreement with Happy Creek Minerals Inc. (“Happy Creek”) (HPY:TSXV). dated October 2, 2024, as amended pursuant to an amending agreement dated October 3, 2024, to acquire the 100%-owned Highland Valley Copper Project in British Columbia.(the “Acquisition”).
The Highland Valley Project (“Highland” or the “Project”) spans 240 km² in southern British Columbia. With its proximity to critical infrastructure like roads, rail, and power, the Highland Valley Project is just 3.5 hours from Vancouver and 30 minutes from Merritt.
As part of the Ore Group, Metal Energy will leverage its extensive experience across other companies and projects to collect, harmonize, and remodel historical data into a comprehensive, modern database. This process will enable the identification of opportunities and trends for future drilling and development.
The Project aligns perfectly with Ore Group’s strategy of capitalizing on historical data in regions that offer excellent access, infrastructure, and proximity to operating mines within established mining districts.
The Highland Valley Project is located on the southern edge of the Guichon Creek Batholith, which hosts the significant HVC open pits. Metal Energy’s newly acquired land package shares many geological similarities with HVC, particularly in two high-priority areas.
- Zone 1: Copper-silver-molybdenum mineralization spanning 1,200 metres in length and remains open to the south and at depth, offering expansion potential. The primary copper-rich minerals include chalcocite and bornite.
- Zone 2: High-grade copper-gold-silver-molybdenum-rhenium mineralization, and notably enriched with gold, setting it apart from typical deposits in the region. Like Zone 1, it offers potential for resource expansion in all directions.
The Project is already permitted to drill and boasts a history of over 55,000 metres of drilling across 402 holes (37,265 metres drilled in 136 holes since 2007), . The Acquisition brings together a highly prospective, underexplored land package.. A systematic drill program will expand known high-potential zones and uncover new targets within the East Zone and West Zone claims.
The Highland Valley property, under Happy Creek’s ownership, was consolidated into a single large land package over 17 years. Most recently, Happy Valley acquired the Mystery property (438 hectares, located in the northern extent of the East Zone claims) in 2021. The Project was historically operated by Asarco Mining (1970s), Cominco Ltd (1980s) and Hudbay Minerals (1990s).
Terms of the Acquisition
Metal Energy shall acquire 100% of the Highland Valley Project from Happy Creek for the following consideration.
On the closing date of the Acquisition (the “Closing Date”) the following is payable:
- $300,000 cash, to be paid on or before the Closing Date to Happy Creek;
- The issuance of common shares in the capital of Metal Energy (“Metal Shares”) to Happy Creek representing 9.9% of the issued and outstanding Metal Shares;
- A 2.5% net smelter royalty (“NSR”) granted to Happy Creek on certain claims of the Highland Valley property, of which 1.5% may be repurchased by Metal Energy for $5,000,000.
Metal Energy shall pay additional consideration to Happy Creek by:
- Conducting $250,000 in exploration expenditures on the Project on or before December 31, 2024.
- The issuance of Metal Shares to Happy Creek with a value of $1,000,000 on or before 12 months after the Closing Date (“Tranche One Consideration Shares”).
- The issuance of Metal Shares to Happy Creek with a value of $1,000,000 on or before 24 months after the Closing Date (“Tranche Two Consideration Shares”).
- The issuance of Metal Shares to Happy Creek with a value of $1,500,000 on or before 36 months after the Closing Date (“Tranche Three Consideration Shares”).
- The issuance of Metal Shares to Happy Creek with a value of $2,500,000 on or before 48 months after the Closing Date (“Tranche Four Consideration Shares”).
(the Tranche One Consideration Shares, Tranche Two Consideration Shares, Tranche Three Consideration Shares, and Tranche Four Consideration Shares are collectively the “Additional Consideration Shares”.)
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