Mining News: Northern Neighbors: BHP Billiton to invest up to C$40 million at Storm
Aston Bay Holdings Ltd. Jan. 28 reported that a Canadian subsidiary of BHP Billiton Ltd. has entered into a tentative agreement to collaborate on exploration of the Storm copper project in Nunavut. Under terms of a letter of intent signed by the companies, BHP Billiton can earn a 75 percent interest in Storm, by investing at least C$40 million on exploration at the project within nine years, including a minimum of C$2.5 million over the first two years. “This new partnership is a testament to the exploration potential at the Storm Copper Project,” said Aston Bay CEO Benjamin Cox. “Our agreement with BHP Billiton will advance the Storm Copper Project without significant equity dilution for Aston Bay’s shareholders, leaving Aston Bay with a meaningful interest in the project,” Cox added. BHP Billiton and Aston Bay are currently discussing terms of a definitive agreement, which the companies are targeting for completion during the second quarter of 2016. BHP Billiton has agreed to pay Aston Bay C$325,000 at the time of signing the definitive agreement. The Storm project covers mineralized showings that stretch for more than 100 kilometers (60 miles) on Somerset Island. Historical drilling includes 110 meters of 2.45 percent copper and 56 meters of 3.07 percent copper at the 2750N zone, as well as 49 meters of 1.79 percent copper at the 2200N zone. Exploration by Aston Bay has identified a number of coincident conductivity and gravity anomalies that are consistent with regional mineralizing processes that have significance for property-wide exploration. “BHP Billiton brings technical depth and expertise to the project, and we are eager to begin exploring the property with their exploration group. Their creative ideas for exploration are innovative and add significant exploration value,” said Cox. Aston Bay is in the process of closing an agreement with Commander Resources to acquire full ownership of the Storm project. Under the agreement with Commander, Ashton Bay has agreed to issue 11 million shares to Commander up front and up to another 5.5 million shares once C$6 million has been spent on exploration at Storm, including amounts already spent, or after Aston Bay raises another C$4 million. Upon completion of the agreement, Commander will hold roughly 25 percent of Aston Bay’s issued and outstanding shares.
- Shane Lasley