TORONTO, May 26, 2022
/CNW/ - Vox Royalty Corp. (TSXV: VOX) (OTCQX:
VOXCF) ("Vox" or the "Company"), a returns
focused precious metals royalty company, is pleased to announce
that it has acquired a producing royalty over the Wonmunna iron ore
mine in Western Australia
("Wonmunna") operated by major ASX-listed producer
Mineral Resources Limited (ASX: MRL) ("MinRes").
The royalty was acquired from an arm's length, private company
(the "Vendor") for the following consideration (the
"Transaction"): US$4,750,000
in cash, US$12,150,000 in Vox common
shares, being 4,350,000 common shares at an issue price of
CAD$3.53 per common share and a
USD/CAD exchange rate of 1.2618 (the "Vox Shares"), and
3,600,000 common share purchase warrants with an exercise price of
CAD$4.50 and an expiry date of
March 25, 2024 (the "Vox
Warrants"). The cash portion of the purchase price was fully
funded by Vox's cash on hand. The definitive agreement was executed
by Vox and the Vendor on May 26,
2022.
The royalty is a 1.25% - 1.50% sliding scale Gross Revenue
Royalty ("GRR") over the Wonmunna mine, with 1.25% GRR
payable when benchmark 62% iron ore price is below A$100/tonne and 1.50% GRR payable when the iron
ore price is above A$100/tonne (the
"Royalty"), which covers the full extent of Wonmunna.
Wonmunna commenced production in April
2021 and is currently producing at a rate of ~5Mtpa of iron
ore, with all approvals received to expand production up to 10Mtpa.
Notwithstanding the closing date of the Transaction, all royalty
payments due and payable to the holder of the Royalty will be for
the benefit of Vox as of April 1,
2022.
Kyle Floyd, Chief Executive
Officer stated: "The Wonmunna royalty acquisition further
expands the revenue and growth profile of Vox and is accretive on
all key metrics. The opportunity to add significant, immediate,
incremental revenue through a non-brokered accretive transaction
with a private seller generates significant value for Vox
shareholders for years to come. We are also excited to increase our
exposure to an A$11 billion market
cap, best-in-class operator, who we know well as the operator of
our producing Koolyanobbing royalty asset. We are also pleased to
share revenue guidance of C$10M –
C$12M for 2022, more than double
Vox's 2021 realized revenues, which reflects the ongoing embedded
growth in Vox's royalty portfolio."
Transaction
Highlights(1)(2)
- Immediately increases Vox's annual revenue forecasts through
the addition of significant, uncapped royalty revenue;
- Provides exposure to a substantial 84.3Mt Indicated &
Inferred iron ore resource located in the world's largest iron ore
exporting Pilbara iron ore region of Western Australia;
- High-quality operating partner in MinRes, who currently operate
two integrated iron ore production hubs (including Vox's existing
Koolyanobbing royalty asset) and two globally significant hard rock
lithium mines in Western
Australia, and are one of the world's largest mining
services businesses, forecast to crush and service total mined
volumes of 275Mt – 290Mt in 2022;
- Provides upside optionality to potential production expansion
from ~5Mtpa to 10Mtpa that is fully permitted and installed
on-site, with maximum total life of mine throughput of "total
inventory of 50Mt – 60Mt" expected by Vox management based on
MinRes public filings;
- Demonstrates Vox's commitment to low carbon operations as per
the ESG Investment Principles outlined in Vox's 2022
Inaugural Asset Handbook, with installation of a 20-year life,
2.1MW solar array and battery currently underway at Wonmunna;
and
- Increases Vox's low geopolitical risk through increased
exposure to Western Australia,
which was recently named by the Fraser Institute's 2021 Mining
Survey as the #1 mining jurisdiction globally based on their
Investment Attractiveness Index.
Asset Overview – Wonmunna
Mine(1)(2)
Wonmunna is located approximately 70km west-northwest of Newman
in the Pilbara region of Western
Australia. The mine is located within the Hamersley Ranges
which has a long mining history. The mine is located within 25
kilometres of operating mines; Hope
Downs (Rio Tinto/Hancock JV), Area C (BHP) and West Angelas
(Rio Tinto). The northern boundary of tenement M47/1425 abuts the
Great Northern Highway.
The Wonmunna mine involves the extraction of high-grade iron ore
from the three Marra Mamba deposits across multiple shallow open
pits (20m – 50m depth), commencing at the western end of the
North Marra Mamba ("NMM") deposit. The mine plan and
throughputs are based on an average grade of 57.5% Iron and
production of 3Mtpa of ore was achieved in 2021, ramping to +5Mtpa
in 2022 onwards.
Leveraging MinRes' miner/contractor integrated model, the mine
was developed ahead of schedule and under budget over a 5-month
development period at a total capital cost of A$126 million. Drilling and blasting is used in
the mining of the ore and overburden, with conventional mining
excavators and mine trucks hauling the ore from the pits to the
crushing and screening plant.
On site processing is limited to dry crushing and blending
according to market requirements. The mine has been developed for
the export iron ore market, although some mine gate sales may be
considered in the future. Export product is hauled to the
MinRes-operated Utah Point bulk port facility the Port Hedland port
via road trains on the Great Northern Highway. There are no
pastoral leases over the mining tenements.
Wonmunna Resource Estimate
as at 18 March
2014(2)
The Wonmunna mine comprises four deposits, NMM, Central Marra
Mamba ("CMM"), South Marra Mamba ("SMM") and East
Marra Mamba ("EMM"), covered by mining leases M47/1423-1425.
The mining leases are contained within exploration licence
(E47/1137), which covers an area of ~230 square kms. All of the
project tenements are beneficially owned by a wholly owned
subsidiary of MinRes.
Both the NMM and CMM deposits have generally simple geometry,
with mineralised zones and boundaries that are clearly defined for
the purposes of grade control and overall management of product
quality. The mine has a low stripping ratio of approximately 1.3:1
tonnes of waste per tonne of ore over the forecast life of the
mine.
A variable cut-off grade policy between 52% Fe to 54% Fe was
used to define ore, with material between 50% Fe and the pit
cut-off to be stockpiled as a potential future low-grade product or
for potential beneficiation. The cut-off grade is applied after
dilution and is selected based primarily on achieving an ore
product of 58% Fe with marketable chemical and physical
characteristics.
Wonmunna Reserve Estimate
as at 6 January
2015(2)
On January 6, 2015, Ascot
Resources Limited defined a maiden Ore Reserve estimate derived
from the 'Indicated Resource' estimate within the larger Mineral
Resource estimate for the NMM and CMM deposits. The total Indicated
Mineral Resource estimate (@ 50% Fe Cut-off grade) for these
deposits is 54.1Mt @ 57.1% Fe. The estimated ore tonnage is
contained predominantly within the Mt Newman member of the Marra
Mamba Iron Formation (MMIF), and therefore exhibits mineralogical
characteristics that are similar to the orebody currently mined at
the neighbouring West Angelas operation managed by Rio Tinto Iron
Ore.
In addition to the current JORC-2012 compliant Mineral Reserve
estimate summarised in Table 2 below, MinRes submitted a Mining
Proposal for Small Mining Operations to the DMIRS Environment
Department dated March 25, 2021
("March 2021 Mining
Proposal")(3), seeking approval to increase the
processing capacity at Wonmunna from 5Mtpa up to a maximum of
10Mtpa. This processing increase was planned to be achieved through
mining multiple pit stages concurrently and increasing the
project's Ore Handling Plant's crushing and screening capacity
through installation of a lump re-screening facility within the
approved footprint on mining lease M47/1424.
The proposed initial mine life included in the March 2021 Mining Proposal was "30Mt over 4
years to 2025" with a "potential increase in total inventory of 50
– 60Mt up to 2028", which supports Vox management's confidence
around a mine life to 2028 and potentially beyond. MinRes reported
in April 2021 that they were carrying
out ~12,000m of resource definition drilling at Wonmunna,
supporting resource to reserve conversion.
For more information on the Wonmunna Mine, please visit the
MinRes website at
https://www.mineralresources.com.au/our-business/commodities/iron-ore/.
2022 Revenue Outlook
In 2022, Vox estimates royalty revenues to total C$10,000,000 – C$12,000,000. The Company expects revenues to be
weighted towards the second half of the year across multiple
operations in Western Australia,
following expanded production from the Janet Ivy gold mine in the
second half of 2022, first ore production from the Otto Bore gold
mine, and potential toll-treatment from the Bulong gold royalty
later in 2022.
Transaction Closing
The Transaction is subject to the final acceptance of the TSX
Venture Exchange.
Qualified Person
Timothy J. Strong, MIMMM, of
Kangari Consulting LLC and a "Qualified Person" under National
Instrument 43-101 – Standards of Disclosure for Mineral
Projects, has reviewed and approved the scientific and
technical disclosure contained in this press release.
About Vox
Vox is a returns focused precious metals royalty company with a
portfolio of over 50 royalties and streams spanning eight
jurisdictions. The Company was established in 2014 and has since
built unique intellectual property, a technically focused
transactional team and a global sourcing network which has allowed
Vox to target the highest risk-adjusted returns in the mining
royalty sector. Since the beginning of 2020, Vox has announced over
20 separate transactions to acquire over 45 royalties.
Further information on Vox can be found at www.voxroyalty.com.
Cautionary Note Regarding Forward
Looking Information
This news release contains certain forward-looking
statements. Any statements that express or involve discussions with
respect to predictions, expectations, beliefs, plans, projections,
objectives, assumptions or future events or performance (often, but
not always, using words or phrases such as "expects" or "does not
expect", "is expected", "anticipates" or "does not anticipate"
"plans", "estimates" or "intends" or stating that certain actions,
events or results " may", "could", "would", "might" or "will" be
taken, occur or be achieved) are not statements of historical fact
and may be "forward-looking statements". Forward-looking statements
are subject to a variety of risks and uncertainties which could
cause actual events or results to materially differ from those
reflected in the forward-looking statements.
The forward-looking statements and information in this press
release include, but are not limited to, statements regarding
production from, and revenue related to, the Wonmunna Mine
(including estimates of project success), annual revenue forecasts
for the Company following the Transaction, anticipated outlook for
the fiscal 2022 year, completion of certain anticipated milestones,
anticipated future cash flows, future financial reporting by Vox,
the receipt of payments from Vox's mining royalty portfolio, and
the requirements for regulatory approvals. In addition, statements
relating to reserves and resources are forward-looking statements,
as they involve implied assessment, based on certain estimates and
assumptions, and no assurance can be given that the estimates and
assumptions are accurate and that such reserves and resources will
be realized. Such statements and information reflect the current
view of Vox. By their nature, forward-looking statements involve
known and unknown risks, uncertainties and other factors which may
cause Vox's actual results, performance or achievements or other
future events, to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements.
Should one or more of these risks, uncertainties or other
factors materialize, or should assumptions underlying the
forward-looking information or statement prove incorrect, actual
results may vary materially from those described herein as
intended, planned, anticipated, believed, estimated or expected.
Vox cautions that the foregoing list of material factors is not
exhaustive. When relying on the Company's forward-looking
statements and information to make decisions, investors and others
should carefully consider the foregoing factors and other
uncertainties and potential events.
Vox has assumed that the material factors referred to in the
previous paragraph will not cause such forward looking statements
and information to differ materially from actual results or events.
However, the list of these factors is not exhaustive and is subject
to change and there can be no assurance that such assumptions will
reflect the actual outcome of such items or factors. The
forward-looking information contained in this press release
represents the expectations of Vox as of the date of this press
release and, accordingly, is subject to change after such date.
Readers should not place undue importance on forward looking
information and should not rely upon this information as of any
other date. While Vox may elect to, it does not undertake to update
this information at any particular time except as required in
accordance with applicable laws.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Technical and Third-Party
Information
Except where otherwise stated, the disclosure in this press
release is based on information publicly disclosed by project
operators based on the information/data available in the public
domain as at the date hereof and none of this information has been
independently verified by Vox. Specifically, as a royalty investor,
Vox has limited, if any, access to the royalty operations. Although
Vox does not have any knowledge that such information may not be
accurate, there can be no assurance that such information from the
project operators is complete or accurate. Some information
publicly reported by the project operators may relate to a larger
property than the area covered by Vox's royalty interests. Vox's
royalty interests often cover less than 100% and sometimes only a
portion of the publicly reported mineral reserves, mineral
resources and production of a property.
Technical References & Notes:
(1)
|
Asset Overview - Ascot
Resources Ltd 6 January 2015 announcement:
https://www.asx.com.au/asxpdf/20150106/pdf/42vvsn5t2cq0k0.pdf
|
(2)
|
Mineral Resource (dated
18 March 2014) & Mineral Reserve (dated 6 January 2015) –
Competent Persons Statement:
|
|
The information in this
report that relates to Exploration Results or Mineral Resources for
the Wonmunna Project NMM and CMM deposits is based on, and fairly
reflects, information compiled by Mr. David Slater, who is a
chartered Professional Member of The Australasian Institute of
Mining and Metallurgy and a Member of the Australian Institute of
Geoscientists. Mr. Slater is employed as Principal Resource
Geologist by Coffey Mining. Mr. Slater has sufficient experience
that is relevant to the style of mineralisation and type of deposit
under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the 2012 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral
Resource and Ore Reserves'. Mr. Slater consents to the inclusion in
the report of the matters based on his information in the form and
context in which it appears.
The information in this
report that relates to Exploration Results or Mineral Resources for
the Wonmunna Project SMM and EMM deposits is based, and fairly
reflects, information compiled by Mr. Dmitry Pertel, who is a
Member of the Australian Institute of Geoscientists. Mr. Pertel is
employed by CSA Global Pty Ltd, independent resource industry
consultants. Mr. Pertel has sufficient experience that is relevant
to the style of mineralisation and type of deposit under
consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2012 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Mr. Pertel consents to the inclusion
in the report of the matters based on his information in the form
and context in which it appears.
The information in this
report that relates to the Ore Reserve estimate is based on, and
fairly represents, information which has been compiled by Mr. Jake
Fitzsimons who is an employee of Orelogy Group Pty Ltd and a Member
of the Australasian Institute of Mining and Metallurgy. Mr.
Fitzsimons has sufficient experience that is relevant to the style
of mineralisation and type of deposit under consideration and to
the activity that is being undertaken to qualify as a Competent
Person as defined in the 2012 Edition of the 'Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves'. Mr. Fitzsimons consents to the inclusion of this report
of the matters based on his information in the form and context in
which they appear.
|
(3)
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The March 2021 Mining
Proposal may be obtained through the following link:
https://geodocsget.dmirs.wa.gov.au/api/GeoDocsGet?filekey=d6e4fe55-bc96-4464-99a2-ecacdb34082c-h00dewgx0esocdsbn9yw9lvtugyoyg0m6tqs37vp
|
SOURCE Vox Royalty Corp.