CALGARY , Sept. 6, 2017 /CNW/ - Altitude Resources Inc. (ALI.V ) is pleased to announce that Kuro Coal Limited ("Kuro ") and Kuro Coal Canada Inc ("Kuro Coal Canada "), have entered into a Share Sale Deed ("SSD ") under which Kuro Coal Canada will purchase 100% of Elan Coal Ltd. Kuro will list on the ASX, TSX-V or an alternative international exchange through an Initial Public Offering in the next six months ("Proposed Transaction "). ALI has a 15% minority interest in Elan Coal Ltd. The Elan Coal Project is the only asset owned by Elan Coal Ltd.
The total value of the transaction is CDN $6.75 million in a combination of cash and shares. Completion of the Proposed Transaction is subject to a number of conditions that have not yet been satisfied. As consideration for the acquisition of Elan, the Vendors (inclusive of Altitude) will receive total cash consideration of C$3.1 million (including C$100,000 which was paid on the signing of the Sale Purchase Agreement) and the issuance of Consideration Shares in the newly listed public entity valued at CDN $3.65 million . Based on the terms of the SPA, ALI's net interest in the Kuro-Elan transaction is valued at $1,012,500 ( $465,000 in cash and $547,500 in Consideration Shares).
Under the SSD, the Vendors have agreed to an initial exclusivity period expiring on 30 September 2017. However, if before that date, Kuro files certain applications for drilling permits at the Grassy North Project, completes field mapping at Grassy North, and confirms that its preliminary geological due diligence has been completed to Kuro's satisfaction, the exclusivity period will be extended to 30 June 2018. The SSD also requires Kuro to have finalised and lodged its prospectus and listing application (for listing on the ASX or an Alternative Stock Exchange) before 31 March 2018 .
About the Elan Property
The Elan property comprises 27 Alberta Crown Coal Lease Applications covering an area of approximately 22,951 hectares. Elan has identified six different zones of potential coking coal development over a 55 km strike length. Elan is located in the foothills and front ranges of the Rocky Mountains of Alberta , approximately 30 km north of Coleman in Alberta . The project is 12km north of the main rail line operated by Canadian Pacific Railway, providing access to export terminals in Vancouver , and north to Prince Rupert . The majority of the Elan properties are accessible by paved highway as well as a system of limited use roads and access trails.
The Elan property resources are documented in a 43-101 Technical Report authored by Dahrouge Geological Consulting Ltd., with an effective date of September 10, 2013 . The Technical Report is a compilation and evaluation of historic exploration, resulting in a Compliant Resource Estimate.
The Property contains low- to medium- volatile bituminous coal suitable for metallurgical uses. Resources fall mainly in the 'complex' category as defined by GSC Paper 88-21. A constant bulk density value of 1.44g/cm3 was assumed across the property and was determined from the coal rank and average ash contents as defined in GSC 88-21. The resource estimation was based on block modelling. The Elan Project lies within Category 2 land zone with respect to coal exploration and development as designated by the 1976 Coal Development Policy for Alberta .
Further key assumptions and details used in the modelling and resource estimate can be found in the "NI 43-101 Technical Report on the Elan Coal Property" dated September 10, 2013 located on SEDAR.
The in-place resources for the Elan Property areas are summarized in Table 1.
Table 1:
Statement of Resources NI 43 101
Coal Resources (Mt)
ASTM Group Type
Indicated
Inferred
Savanna
Low to Medium Volatile Bituminous
28.8
29.9
Isolation
Medium Volatile Bituminous
1.3
0.8
Isolation South
Low to Medium Volatile Bituminous
31.9
53.8
Total
-
61.9
84.6
Any discrepancy in totals are the result of rounding errors.
Location Map
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