Canadian miner Kuya Silver announced in early January that it was finalising the acquisition of battery materials refiner Electra Battery Materials’ assets in the two companies’ Silver Kings joint venture in Northern Ontario.
This deal will boost Kuya’s ownership in the Silver Kings Project from 75% to 100%.
To finalise the deal, which covers about 16,600 hectares of silver and cobalt exploration assets in Canada’s Cobalt Camp, Kuya has to pay 1 million Canadian dollars ($755,000) in cash or in the equivalent value of shares to Electra by 31 January. It has already partly met these terms by supplying Electra with common shares worth 1 million Canadian dollars.
However, Kuya will still have to pay a 2% royalty on net smelter returns from commercial production derived from the remaining assets at the site.
Why it matters
Electra, formerly known as First Cobalt, is getting rid of its non-core Canadian assets while retaining royalty interests.
The company is focusing on the development of an integrated battery materials factory, which will produce cobalt, nickel, and manganese sulphates, as well as recycle batteries.
“Our initial agreement with Kuya was designed to allow us to maximise shareholder value for our exploration assets in Ontario, given our primary focus on recommissioning North America’s first cobalt sulphate refinery,” Electra CEO Trent Mell said.
Kuya, which provided an exploration update for the project on Monday, sees very high-grade silver potential close to the surface.
“Although Kuya Silver remains focused on its flagship Bethania silver project in Peru, having this kind of scale in a mining-friendly jurisdiction like Ontario will differentiate the company from other single-project juniors,” said Kuya CEO David Stein, commenting on the deal.
Silver will be the project’s main focus in the future, while cobalt is likely to be produced at the site as a co-product or by-product, he added.