Victory Nickel Inc. Signs Option Agreement for Alberta Frac Sand Resources
Transaction is In-Line with Strategic Plan to Provide Range of Imported and Domestic Frac SandTORONTO, October 30, 2018 - In-line with its strategy to provide a full suite of import and domestic frac sand products to the northern oil and gas markets, Victory Nickel Inc. ("Victory Nickel" or the "Company") (CSE: NI, OTC: VNCKF, www.victorynickel.ca) today announced that its subsidiary Victory Silica Ltd. ("Victory Silica") has entered into an agreement (the "Exploration and Option Agreement") with Short Grass Ranches Ltd. (the "Owner") giving the Company the option to mine frac sand from one of the Owner's properties (the "Short Grass Property").
The Short Grass Property is located approximately 52 kilometres from the Company's Seven Persons frac sand plant (the "7P Plant") near Medicine Hat, Alberta. Since 2014, Victory Nickel has been producing and selling the highest-quality Northern White frac sand imported from Wisconsin at the 7P Plant. The Exploration and Option Agreement gives the Company the potential to produce an in-basin domestic sand which has grown in popularity in North America as a means to reduce overall frac cost. Any sand mined from the Short Grass Property would be trucked to the 7P Plant for processing and sale alongside side the Northern White products.
"As a result of increased demand from certain customers for domestic frac sand in particular applications, the Company has been aggressively searching for high-potential properties in the vicinity of the 7P Plant," said Ken Murdock, CEO of Victory Silica. "Our business plan always contemplated sales of domestic frac sand from both our own Minago project in Manitoba and from other strategically-located Canadian frac sand deposits in addition to sales of Northern White. With the signing of the Exploration and Option Agreement, the Company has the potential to join its American competitors in offering both imported Northern White and an in-basin domestic alternative. Broadening its product offering will allow Victory Nickel to appeal to a wider variety of customers and better take advantage of opportunities as the frac sand market evolves."
Under the terms of the Exploration and Option Agreement, the Company has a 180-day period to evaluate the Short Grass Property. Should the Company exercise its right to develop a commercial frac sand mine (the "Option"), it will pay the Owner a royalty for frac sand sold from the Short Grass Property. The initial term of the Option would be for five years with the ability to extend for additional five-year terms.
About Victory Nickel
Victory Nickel Inc. is a Canadian company with four sulphide nickel deposits containing significant NI 43-101-compliant nickel resources and a significant frac sand resource at its Minago project. Victory Nickel is focused on becoming a mid-tier nickel producer by developing its existing properties, Minago, Mel and Lynn Lake (currently under option to Corazon Mining Ltd.) in Manitoba, and Lac Rocher in northwestern Québec. Through a wholly-owned subsidiary, Victory Silica Ltd., Victory Nickel at its 7P Plant frac sand processing facility in Seven Persons Alberta, has established itself in the frac sand business prior to commencing frac sand production and sales from Minago.
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| Victory Nickel Inc. | Victory Silica Ltd. |
Forward-Looking Information: This news release contains certain forward-looking information. All information, other than information regarding historic fact that addresses activities, events or developments that the Company believes, expects or anticipates will or may occur in the future is forward-looking information. The forward-looking information contained in this news release, including information related to the completion and outcome of any debt restructuring activities reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. The forward-looking information contained in this news release is subject to a number of risks and uncertainties that may cause actual results or events to differ materially from current expectations. Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable law, the Company disclaims any obligation to update or modify such forward-looking information, either because of new information, future events or for any other reason. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
SOURCE: Victory Nickel Inc.