Fulcrum Metals to acquire Tully Gold project in Ontario

LONDON, UK: Fulcrum Metals plc (LON: FMET), a company focused on mineral exploration and development in Canada, has announced that it has entered into an agreement to acquire a 100% interest in the Tully Gold project in Ontario from 1911 Gold Corp. (TSXV:AUMB) for CAD800,000 in cash, plus a 1.5% net smelter return royalty.

Tully is located 25 kilometres northeast of Timmins and includes an historic indicated and inferred mineral resource of 1.3 million ounces of gold at an average grade of 6.5 grams per tonne. The project is located within the world-class Timmins-Porcupine Gold Camp and is 2 kilometres southwest of the Bradshaw Gold Project of Gowest Gold Ltd., where work is underway to restart mine operations.

Fulcrum Metals said the acquisition of Tully would complement its existing portfolio of gold and base metal projects in Ontario, which include the Schreiber-Hemlo Project comprising of Big Bear and the Jackfish Lake properties, the Winston Lake Project and the Tocheri Lake Project.

The company also announced that it has raised £325,000 by the issue of unsecured convertible loan notes to new and existing shareholders, and that certain directors of the company have indicated their intention to subscribe for £195,000 of loan notes, bringing the gross proceeds of the fundraising to £520,000. The net proceeds from the fundraising will be used by the company to satisfy the consideration due under the agreement, costs and for working capital needs.

The loan notes are convertible at 18.5 pence per ordinary share at any time at the election of the subscriber, or automatically if the Fulcrum Metals share price exceeds a volume-weighted average share price of 24 pence for five consecutive trading days. The loan notes bear interest at 12% per annum compounded semi-annually and are due for repayment on 31 July 2025.

The acquisition is subject to customary closing conditions, including regulatory approvals and due diligence. The company expects to complete the acquisition by Q1 2024.

Fulcrum Metals CEO Mark Potter said: “We are delighted to announce this strategic acquisition of Tully, which adds a significant gold resource to our portfolio in a premier mining jurisdiction. Tully has excellent exploration potential and we look forward to advancing the project with our experienced team. We are also pleased with the support from our shareholders for the fundraising, which will enable us to execute our growth strategy and create value for our stakeholders.”