Pele Mountain Resources has divested itself of one of two Highland Gold projects, located along the Michipicoten Greenstone Belt, with plans to focus on its Elliot Lake project. A second divestiture is forthcoming.
The sale to Prodigy Gold Inc. will net Pele $1.775 million in cash and a net smelter return on portions of the project. The agreement on the second Highland project is expected to close at the end of this month.
"Our updated preliminary economic assessment (PEA) for Eco Ridge demonstrates that Pele is one of the clear leaders in the ongoing race to develop new sources of critical rare earths outside of China,” Al Shefsky, president and CEO, said in a news release.
“We are currently preparing our updated project description, which is already well advanced, and is the lead document required to begin the licensing process. The divestiture of Highland will allow us to better focus our efforts on advancing development at Eco Ridge."
The PEA for Eco Ridge, located near the city of Elliot Lake, is calls for a 9,000-tonne-per-day operation, producing 97.2 million pounds of REO and 27.5 million pounds of uranium over 11 years. Over its life, the mine is expected to bring in cumulative total revenue of $5.9 billion.