Grid Metals Receives Positive Engineering Study; Primero Report Outlines Viability and Costs of Reconfiguring True North Mill for Lithium Processing - Seite 3

Foto: Accesswire

Figure 1: Location of the True North mill in the Rice Lake greenstone belt showing proximity to the Donner Lake lithium property and the City of Winnipeg.

Foto: Accesswire

Figure 2: Aerial View Of True North Mill

Foto: Accesswire

Figure 3: Primary mill at True North

Foto: Accesswire

Figure 4: Flotation circuit at True North mill

As part of its due diligence for the Donner Lake project, Grid commissioned a separate study on the tailings facility at True North focused on estimating both future capacity and engineering work required to utilize the existing tailings facility for future deposition from the reconfigured mill. The study determined that the existing tailings facility was sufficient to move ahead with the project.

Lease Agreement for True North Mill

On the basis of the positive Primero study, Grid is proceeding with the Lease Agreement for the True North Mill (the "Lease") that was announced on July 18, 2023. The Lease is subject to certain amendments that reduce the near-term cash funding requirements from Grid. The Lease included a due diligence period that was extended to October 24, 2023 by the mutual agreement of Grid and 1911 Gold Corporation. The initial payment under the Lease of C$1 million (C$400,000 via equity and C$600,000 cash) is now due to 1911 Gold and will be paid out of Grid's working capital. The next scheduled payment under the amended terms of the Lease is a payment of C$500,000 due on April 30, 2024.

The initial lease term is five years followed by a two-year notice period for cancellation and including an option to extend the lease, by mutual agreement, for an additional five years. The lease agreement provides Grid with the right to use the mill to process lithium feed and to reconfigure the existing mill. The Lessor has the right to utilize the mill to process gold ore in the future under certain terms and conditions during the term of the lease subject to bearing the capital and operating costs thereof.

Under the terms of the lease, following the payment of C$500,000 due on April 30, 2024, C$1,000,000 is due on December 31, 2024 and C$900,000 is due on December 31, 2025. An additional C$500,000 payment is due conditional on Grid completing an equity raise of more than C$1,000,000. The total payments for the Lease including the conditional payment have been reduced from $4,650,000 to C$4,200,000 over the term of the Lease. In addition, Grid will cover certain operating payments of the mill for environmental monitoring, security and power costs commencing on January 1, 2024 which are expected to be in the range of C$30,000 per month on average. Other operative terms of the Lease Agreement (including the use of the Lease payments by the Lessor) as announced on July 18, 2023 are unchanged.