Aug 20 2019
North American Palladium Ltd recently reported that the Company has invested a 51% interest in the Sunday Lake Project. The decision to opt for investing in this platinum group metal (PGM) property was supported by favorable drilling results from the PGM Zone.
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This zone includes the finest intersection reported thus far (41.2 m grading 3.22 g/ton Pt, 2.08 g/t Pd, and 0.21 g/ton Au in drill hole SL-19-026).
After finishing two winter drilling programs, the company has surpassed the mandatory two-year exploration expenditure requirement and has finished the necessary cash payments to its partners, including $675,000 to Impala Platinum Holdings Limited (“Implats”) and $75,000 to Transition Metals Corp. (“Transition”).
Consequently, Implats’ interest in the joint venture has been decreased to 24%, while Transition retains a 25% free carried interest until the conclusion of a feasibility study.
We are very pleased to partner with Implats and Transition on the Sunday Lake Project, which is NAP’s best blue-sky opportunity and a key element of our long-term strategy to build an inventory of high-quality platinum group metal assets in the Thunder Bay region. We have demonstrated that the PGM Zone has significant lateral continuity and are now able to focus on areas of enhanced thickness and grade.
Jim Gallagher, CEO and President, North American Palladium Ltd
About the Sunday Lake Project
The Sunday Lake PGM Project is situated 25 km north of Thunder Bay in Jacques Township, about 60 km south of NAP’s Lac des Iles Mine operations. The property comprises the Sunday Lake Intrusion, which belongs to the Proterozoic Mid-Continental Rift magmatic event that created the Tamarack (Rio Tinto—Talon Resources) and Duluth Complex (Antofagasta PLC) magmatic sulfide deposits in Minnesota, as well as the Eagle nickel deposit in Michigan (Lundin Mining).
About the Agreement
Before NAP invested a 51% interest, the Sunday Lake Project was a joint venture between Implats and Transition, whereby Implats kept a 75% interest and Transition kept a 25% free carried interest through to the completion of a feasibility study, at which time Transition’s interest would change to a 25% participatory interest.
On June 20th, 2017, Transition and Implats jointly signed an Option Agreement with NAP. The Agreement offers NAP with the exclusive right to obtain Implats’ 75% ownership in the Sunday Lake Project by finishing the following exploration expenditures and cash payments:
- Stage 1: NAP was authorized to purchase a 51% interest in the property by investing $1.5 million in exploration costs as well as making cash payments of $75,000 to Transition and $675,000 to Implats in two years. This stage has currently been finished.
- Stage 2: NAP may increase its interest from 51% to 65% by investing an extra $2.5 million in exploration costs and making additional cash payments of $125,000 to Transition and $1.125 million to Implats within two years.
- Stage 3: NAP may additionally increase its interest from 65% to 75% by investing an extra $0.5 million in exploration costs and making final cash payments of $150,000 to Transition and $1.35 million to Implats within one year.