American Battery Metals announced that it has entered into a non-binding letter of intent to acquire a 90% interest in Ontario-based E.U. Energy Corp. and its 100%-owned Viken project in Sweden.
In a media statement, the North Vancouver-based company said the letter of intent stipulates that American Battery Metals has to issue 20 million shares in exchange for 90% of the issued and outstanding shares of E.U. Energy, in addition to the right for E.U. Energy to nominate one member to the board.
The proposed transaction is also subject to a non-brokered private placement for C$1.5 million, a bridge loan to E.U. Energy, due diligence, finalization by both parties to enter into a definitive agreement, in addition to regulatory approvals.
“This transaction represents a significant milestone for ABM as the Viken is one of the largest, development-stage, vanadium projects globally with the potential for substantial by-product metal production,” said Michael Mulberry, President & CEO of American Battery Metals.
Viken is located in Jämtland County, 570 kilometres north-northwest of Stockholm.
The project is host to a significant National Instrument 43-101 polymetallic Mineral Resource, representing an in-situ vanadium (V2O5) Mineral Resource of 163 million pounds in the Indicated category and 16.7 billion pounds in the Inferred category.
According to American Battery Metals, the project has seen a significant amount of work with a 2010 Preliminary Economic Assessment outlining an open pit mine for vanadium, molybdenum and nickel, followed by a 2014 Updated PEA to evaluate the use of bio-heap leaching.
“More recently, E.U. Energy has engaged P&E Mining Consultants Inc. to evaluate a more efficient footprint, lower CAPEX, vanadium-focused operation with the potential for significant by-product metal production,” ABM said in the media brief.