Pancon and Essential Mining Resources Revise Purchase Price for Pancon's Interest in the Crossland Joint Venture
TORONTO, ONTARIO--(Marketwired - Oct. 7, 2015) -
NOT FOR DISSEMINATION INTO THE USA
Pancontinental Uranium Corp. (TSX VENTURE:PUC) ("Pancon" or the "Company") reports that further to its July 15, 2015 news release, the cash compensation to be received from the sale of the Company's entire interest (43.72%) in the Joint Venture with Crossland Strategic Metals Ltd. ("Crossland"), of Australia, has been reduced and the sale to Essential Mining Resources PTY Ltd. ("EMR") has been closed in escrow, subject to receipt of Pancon shareholder approval. The Joint Venture is comprised of the extensive Charley Creek rare earth (REE) project and a number of prospective uranium and REE properties in the Northern Territory of Australia. The Company's interest in the Joint Venture is held in its wholly owned subsidiary, Panconoz Pty. Ltd.
EMR is a private Australian-based company which is 100%-owned by EMMCO Mining Sdn Bhd ("EMMCO"), a private Malaysian company beneficially held by a consortium of South East Asian investors.
The cash compensation component of the purchase price was reduced from AUD $2,550,000 to AUD $1,300,000, of which an AUD $450,000 deposit was paid in March, 2015 and the balance of AUD $850,000 is currently held in trust by Pancon's legal counsel, pending receipt of shareholder approval. In addition, the Company retains its one percent (1%) gross overriding royalty (GOR) on sales of all production from 100% of the property.
Pancon CEO and President, Rick Mark, states: "We are disappointed that we were not able to close the sale on the original terms, but considering the state of the global economy, poor financial markets for juniors and depressed commodity markets, we are pleased to be in a position to complete the sale. The continued decline in the price of commodities coupled with the economic uncertainties in China, the major market for rare earth elements, resulted in a long and protracted negotiation with EMR. The total cash compensation of AUD $1,300,000 is slightly over 50% of the original price and we believe this to be a reasonable accommodation, given the difficulties of obtaining financing and the condition of the REE market today. Importantly, we have maintained our 1% GOR on all production. If the REE market improves and production begins at Charley Creek, Pancon shareholders will benefit from that GOR."
A special meeting of Pancon shareholders is scheduled to be held on November 23, 2015 to approve the amendment to the purchase price with closing to occur on or about November 26, 2015.
About Pancontinental Uranium Corporation
Pancontinental Uranium Corp. is a Canadian-based company that has been focused on rare earth elements (REE) and uranium discovery and development. Through a joint venture with Crossland, the combined management and operating team has unparalleled experience from exploration, through development to operations. Pancon and Crossland hold an impressive REE and uranium exploration portfolio with projects in prolific, mining friendly districts in the NT, Australia. Exploration has primarily occurred on two projects, known as Charley Creek and Chilling.
ON BEHALF OF THE BOARD OF DIRECTORS
Rick Mark, President & CEO
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Language and Forward Looking Statements
This press release may contain "forward-looking statements", which are subject to various risks and uncertainties that could cause actual results and future events to differ materially from those expressed or implied by such statements. Investors are cautioned that such statements are not guarantees of future performance and results. Risks and uncertainties about the Company's business are more fully discussed in the Company's disclosure documents filed from time to time with the Canadian securities authorities.