AIDEA Bolsters Support for Heavy REE Separation Plant & Renews Commitment to Ucore’s Bokan Heavy REE Project
HALIFAX, Feb. 10, 2020 - Ucore Rare Metals Inc. (TSXV: UCU) (OTCQX: UURAF) (“Ucore” or the “Company”) is pleased to provide the following progress update with respect to the roll-out of its MINE to METAL to MARKET plan of strategic actions (the “M³ Plan”) for its Bokan-Dotson Ridge Rare Earth Project (the “Bokan Project” or “Bokan”); further to the Company’s press release of September 10, 2019.
AIDEA Financing Opportunity Update
The Alaska Industrial Development and Export Authority (“AIDEA” or the “Authority”) is the development finance arm of the State of Alaska. AIDEA has financed hundreds of projects around the state from smaller businesses to larger infrastructure development projects. AIDEA has been involved in mineral development and mining infrastructure financing.
Ucore is pleased to announce that the Authority, with the support of Alaska Governor Michael Dunleavy, recently expressed its renewed and augmented interest in “… working toward the development of a processing plant for rare earth metals in Southeast Alaska and the eventual development of the Bokan rare earth deposit on Prince of Wales Island” (see letter entitled “AIDEA Review of the Alaska SMC and the Bokan-Dotson Ridge Projects”, dated December 18, 2019, the “AIDEA Letter”). The recent AIDEA Letter also stated:
“According to media reports, the U.S. Army recently sent out memos to a select group of companies that are advancing potential U.S.-based rare earth processing plants requesting information on the costs to develop separation facilities that can produce heavy rare earths. The Army is considering funding up to two-thirds of the costs required to establish at least one domestic facility which can separate these heavy rare earths into the individual metals needed for military hardware.
"AIDEA understands Ucore was one of the recipients of the U.S. Army memorandum and therefore the authority wanted to express its continued interest in providing financing for Ucore’s Bokan project and its proposed development of a REEs processing plant located in Alaska.
"In 2014, the Alaska Legislature, in Senate Bill 99, authorized AIDEA, at its discretion, to issue up to $145 million dollars in AIDEA bonds to finance the infrastructure and construction costs of the Bokan-Dotson Ridge rare earth element project, which is owned by Ucore.
"In addition to the bonds authorized by the Alaska State Legislature, AIDEA also has the ability to provide financing to Ucore by issuing conduit bonds to potentially support financing the construction of a processing plant. Conduit bonds are issued on the basis of the revenue produced by a financed project. AIDEA has issued conduit bonds for a variety of projects, and can issue this type of bond based on the approval of its Board.
"We would be glad to provide the U.S. Army with any additional information it may need about AIDEA finance programs which could apply to Ucore.”
The prospective AIDEA-provided financing is an expected integral component of Ucore’s planned objective of developing: (i) the individual heavy rare earth element (“HREE”) and co-products processing and separation plant, the Alaska Strategic Metals Complex (the “Alaska SMC”) which may commence with alternative U.S. or U.S. allied feedstocks; and (ii) its planned ultimate source of rare earth element (“REE”) feedstock, the Bokan mineral resource.
AIDEA’s support of these two components of Ucore’s M³ Plan is important to Ucore as the Company seeks additional project funding through recent U.S. Government (“USG”) initiatives specifically devoted to enhancing the domestic supply, separation, and purification of individual rare earth oxides over the next decade. These initiatives may provide federal funding opportunities to domestic entities that can raise from one-third to one-half of a project’s total required capital funding while meeting the requirements set forth by the U.S. Government.
“Ucore is grateful to AIDEA for its continued support of our efforts toward project development in Southeast Alaska,” said Jim McKenzie, President & CEO of Ucore. “The $145 million AIDEA bonds authorization by the Alaska Legislature for the Bokan Rare Earth Project, and the recent notification regarding potential AIDEA conduit bond financing for the Alaska SMC uniquely positions Ucore in its pursuit to advance these projects. The current U.S. government initiatives to liberate North America from Chinese dependence on REEs require an element of self-funding that the AIDEA financing may provide or contribute to, and it distinguishes the potential development of Bokan apart from other Heavy REE projects.”
“Ucore is embarking on a series of incremental engineering and technical development activities to bolster its knowledge of Bokan and to enhance its capabilities regarding the planned Alaska SMC separation and purification facility,” stated Mike Schrider, COO of Ucore. “AIDEA’s potential financing assistance will be fundamental as we look to aggregate these various technical initiatives within the eventual feasibility study that is ultimately required for the development of the Bokan mineral resource.”
About Ucore
Ucore Rare Metals Inc. is a company focused on rare and critical metals resources, extraction and beneficiation technologies with potential for production, growth, and scalability. The Company has a 100% ownership stake in the Bokan-Dotson Ridge Rare Earth Project.
Ucore’s vision and plan is to transition to become a leading advanced technology company that provides mineral separation products and services to the mining and mineral extraction industry. This vision includes the development of the Alaska SMC in Southeast Alaska and the development of the Company’s rare earth minerals property located at Bokan Mountain in Alaska.
The first component of the Company’s M3 Plan (i.e. the potential “Mine”) is founded upon the Company’s Preliminary Economic Assessment (“PEA”), an NI 43-101 Technical Report filed on SEDAR on March 14, 2013, that was based upon an inferred mineral resource estimate with an effective date of March 7, 2011 (as supplemented by separate mineral resource updates on May 11, 2015, and October 15, 2019).
Ucore’s PEA is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
For further information, please contact Mr. Jim McKenzie, President & CEO of Ucore Rare Metals Inc. at: +1 (902) 482-5214 or visit <http://www.ucore.com>.
Qualified Person
Mr. Edwin H. Bentzen III, a consulting metallurgical engineer, has approved the scientific and technical content of this news release and is the Qualified Person responsible for its accuracy. Mr. Bentzen received a B.Sc. degree in 1967, at the Mackey School of Mines, University of Nevada, Reno, with a Minor in Chemistry. He has worked with industrial minerals while at the Minerals Research Laboratory, in Asheville, N.C. and been employed by the Colorado School of Mines Research Institute, Ore Sorters (North America) Inc., Hazen Research, MD Mineral Technologies, Lyntek Inc. and Resource Development Inc. He is active in SME (Registered Member) and is past President of the Colorado Section SME.
Cautionary Notes
This press release includes certain statements that may be deemed “forward-looking statements”. All statements in this release (other than statements of historical facts) that address future business development and/or acquisition activities (including any related required financings), timelines, litigation outcomes, events or developments that the Company expects, are forward looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance or results and actual results or developments may differ materially from those in forward-looking statements. Regarding Ucore’s M3 Plan of Action and the disclosure in the “About Ucore” section above, the Company has assumed that it will be able to procure or retain geometallurgy partners and/or suppliers, including a solvent extraction (“SX”) partner or SX supplier for Ucore’s expected future Alaska Strategic Metals Complex (“Alaska SMC”). Ucore has also assumed that sufficient external funding will be found to prepare a new NI 43-101 technical report that demonstrates that the Bokan Project is feasible and economically viable for the production of both REE and co-product mineral materials and metals and the then prevailing market prices based upon assumed customer off-take agreements. Ucore has also assumed that sufficient external funding will be found to develop the specific engineering plans for the Alaska SMC and its construction. Factors that could cause actual results to differ materially from those in forward-looking statements include: Ucore not being able to procure an SX partner or supplier for the Alaska SMC; Ucore not being able to raise sufficient funds to fund the specific design and construction of the Alaska SMC; adverse capital market conditions; unexpected due diligence findings; unexpected or adverse outcomes in the currently outstanding litigation matters between Ucore and IBC Advanced Technologies, Inc.; the emergence of alternative superior metallurgy and metal separation technologies; the inability of Ucore to retain its key staff members; unexpected transaction costs or other deal completion setbacks; a change in the legislation in Alaska and/or in the support expressed by AIDEA regarding the development of Bokan and/or the Alaska SMC; the availability and procurement of any required interim and/or long-term financing that may be required; and general economic, market or business conditions.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined by the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
