ePower Metals Inc

ePower Metals—Advancing High-Quality Cobalt Projects

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Overview

ePower Metals Inc (TSXV:EPWR) is a resource exploration company focused on advancing a high-quality portfolio of cobalt projects, with the goal of providing cobalt to the ever-growing rechargeable battery sector. Currently, ePower Metals is dedicated to exploring and advancing its flagship Panther Creek cobalt property, for which it has entered into an options agreement with Utah Mineral Resources LLC (UMR) for a 100 percent interest.

The Panther Creek property is situated upon Idaho’s cobalt belt, a proven region rich in mining history and historical cobalt mining projects. ePower Metals’ property is located alongside the eCobalt Ram property, which has a measured and indicated resource of 3.44 million tonnes at 0.59 percent cobalt and 0.73 percent copper. To date, the company has conducted soil and rock sampling initiatives, and is in the process of executing further groundwork in order to determine drill targets and better understand the potential for an economic resource.

Moving forward, ePower Metals will continue to develop its portfolio using a multi-pronged growth strategy that could include the acquisition of non-core cobalt assets; underperforming cobalt companies; bulk tonnage targets hosted in laterite; and high-grade, narrow-vein, direct-ship ore special projects. To this effect, the company has been investigating potential opportunities in Mexico and South America, where cobalt has been underexplored. The company plans to execute on acquisitions within the first half of 2018 and bring in partners to work on these assets where possible.

ePower Metals is led by a group of executives with a deep understanding of the full mining cycle. This includes company chairman, Alan Savage, who brings 50 years of capital market experience, and CEO Michael Collins, who has worked both in the mining engineering space and in advancing projects towards production with large mining entities. The management team is also significantly invested in the company, holding 16 percent of shares.

Investment Highlights

  • Option agreement for 100 percent interest in strategic property in proven Idaho cobalt belt
  • Property adjacent to eCobalt property with measured and indicated resource of 3.44 million tonnes at 0.59 percent cobalt and 0.73 percent copper
  • Strategically positioned in a cobalt market forecasting higher prices and increases in demand
  • Innovatively starting to develop cobalt-specific exploration initiatives
  • Experienced management team with deep understanding of full mining cycle holding 16 percent of shares
  • $2 million financing closed in December 2017

Growth of Cobalt Market

The cobalt market has been facing growing demand in the recent years as it is a key component of lithium-ion batteries used in electric vehicles and consumer electronics. Following this trend, demand is expected to increase by over 90 percent to 203 kilo tonnes by 2025. Within this time period, due to potential market deficits, the cobalt price is also expected to grow to US$34 per pound, up 41 percent from 2017 prices.

source: Cannacord Genuity
Source: Cannacord Genuity

Within this growing cobalt market, ePowers is taking an innovative approach to cobalt exploration. The company is looking to develop projects with cobalt as a primary resource, as opposed to as a subset of gold or silver projects, as it has commonly been produced. To this effect, ePower is currently conducting exploratory work on its flagship property in Idaho, US.

Flagship Project: Panther Creek Cobalt Property

In October 2017, ePowers entered into an option agreement with UMR to earn up to 100 percent interest in the Panther Creek cobalt project. The property includes 3,060 acres of lode mining claims and a 41.3-acre mining lease located in the proven mining jurisdiction of Idaho’s cobalt belt.

The property is located 26 miles away from Salmon, Idaho—a supply and transportation center—and is easily accessible by roads. It is also adjacent to the eCobalt Solutions project and on trend with their Ram cobalt-copper-gold deposit. The mineralization on the property is hosted in the Apple Creek formation, which is akin to the historic Blackbird mine and the Ram mine.

 

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Under the terms of the agreement, the company has already acquired a 50 percent interest in the project having paid UMR US$150,000 and having issued 5.5 million shares to UMR shareholders. The remaining 50 percent interest will be granted following a payment of $150,000 within 12 months, a another $150,000 and $100,000 of expenditures on the property within 24 months, and an additional $200,000 of property expenditures within 36 months. UMR is also entitled to receive a 2 percent NSR on all project production.

The Idaho cobalt belt

Running for approximately 37 miles across east-central Idaho, the Idaho cobalt belt hosts the largest known cobalt resources in the US. There are a series of historic mines and prospects from the Blackbird district as well as deposits of the Iron Creek zone located along it. This includes the eCobalt Idaho cobalt project—adjacent to ePower’s property—for which eCobalt has completed a feasibility study with a measured and indicated resource of 3.44 million tonnes at 0.59 percent cobalt and 0.73 percent copper.

History

The Panther Creek cobalt project has seen limited exploration activities to date. There are two known cobalt and copper showings on the property which were sampled by the US Geological Survey in 1998. These include the Sweet Repose adit, which showed results of 0.45 percent cobalt and 5.27 percent copper, and the Long Dike adit, with results of 1.04 percent cobalt and 4.14 percent copper over 3 meters. Additional surface sampling conducted by UMR in 2016 included values from trace to 0.91 percent cobalt and 3.63 percent copper and, in another sample, 0.74 percent cobalt and 0.27 percent copper.

Fall exploration program

Since entering the option agreement for the property, ePower has conducted a sampling program in which they collected 797 soil samples and 14 chip-channel rock samples across the two known mineralized zones. The results for the soil samples, announced in January 2018, ranged from 4.7 ppm to 355 ppm cobalt. Meanwhile, assays for the rock samples ranged from trace to 0.37 percent cobalt and 0.014 g/t gold to 19.3 g/t gold.

The program also delineated two parallel soil anomalies which intersect historic workings in the two adits and trend towards the Blackbird mine.

The upcoming 2018 exploration program for the property will include further sampling and structural mapping in the Sweet Repose and the Long Dyke adits. The work conducted during the winter will help define drill targets below the adits and refine the exploration model for future initiatives. Additionally, further soil and outcrop sampling across the entire property is also planned.

Management

Alan Savage—Chairman and Director

Alan Savage brings 50 years of experience in the capital markets in North America and offshore to Argus. Among other accomplishments, he was the founder of Imperial Metals Corporation and president and a director of that Company from 1978 to 1986. As President of New Canamin Resources Ltd, he was credited with the discovery and commercial feasibility of the 20,000 TPD Huckleberry copper deposit in British Columbia. He is currently a director of Pacgen Life Science Corp and Epicore Bionetworks Inc, and owns and operates Southern Gold Resources Ltd, a successful investment and venture capital enterprise.

Michael Collins, PGeo—President, CEO and Director

Michael Collins is a Professional Geologist with extensive public market and consulting engineering management experience. He worked for 5 years as VP North America with Mining Plus Canada Ltd., a specialized underground and surface mining engineering consulting company. He has also served as management or as a director of five Vancouver based public companies since 2005 and is currently also a director of Nortec Minerals Corp. Over the last 21 years he has developed a strong skill set in mineral exploration, deposit modelling and project development. He graduated with a BSc. Honours from Dalhousie University in 1996.

Companies and projects of note include production and exploration at the Red Lake Mine with Goldcorp, exploration work on the South Raglan project in the Ungava Peninsula with Canadian Royalties and as a consulting geologist on cobalt projects in Western Uganda and the Idaho Cobalt Belt. His work has also taken him to such diverse environments such as East Africa, Central and South America and Southeast Asia.

Simon J Anderson—CFO

Simon Anderson is a Chartered Accountant with extensive experience in financial reporting, corporate finance and management with public companies. He is a director or officer of several Canadian and US-listed companies ensuring public disclosure meets current standards and planning and implementing acquisitions and divestitures.
Previously, he was a partner with an international accounting and consulting firm practicing in the areas of business valuation, mergers and acquisitions and business planning services.

Catalin Kilofliski—Director

Catalin Kilofliski, is a professional economist with over 20 years of experience in business development, mergers and acquisitions, corporate finance, communications, governance and sustainability in Canada, US, Europe and Asia. He graduated from the Academy of Economic Studies in Bucharest, Romania with a BCom degree in Business Administration and Economics in 1997 and has since completed several professional programs in capital markets, business strategy and corporate governance.

Currently CEO of Canarc Resources, an active mining development company, he was Director of Corporate Communications with Aurcana Corporation from 2012 to 2014 and served in a similar role for Selwyn Resources Corporation from 2010 to 2012. From 2001 to 2012 he worked as an industry analyst with a $3.5 billion investment fund. He has been instrumental in raising over $250 million in joint venture, equity and debt financings for mineral resource projects since 2010.

Dr. Gregg C Bruce, PhD—Director

Dr. Gregg C. Bruce graduating with a PhD. in chemistry from University of Victoria in 1992 and started work as Project Manager for the USAF large rechargeable Lithium cell development program. The timing of this initial assignment was fortuitous since it coincided with commercialization, by Sony in 1991, of the Lithium Ion battery. The performance of these cells was a very important initial step in the development of large Li Ion cells for space and defense applications and the subsequent commercialization and mass production of lithium batteries. It was during this period where he was recognized as one of a handful of North American Lithium Ion technical experts.

For the past seventeen years he has been involved in the development and manufacture of Lithium Ion batteries for implantable medical applications. During the same period of time he has also been involved in the commercialization of Li/MnO2 cell chemistry producing the world’s smallest implantable battery using Li/MnO2 cell chemistry. More recently his work has focused on Li/CFx-MnO2 battery technology and this work has resulted in the award by the US Army for the production of the BA-5790/U battery for man portable devices.

Fred Tejada, PGeo—Director

Fred Tejada is a professional geologist, registered in British Columbia. He has 30 years of international mineral industry experience and has a proven track record, working with both major and junior mining and exploration focused organizations. He was Country Manager for Phelps Dodge Exploration Corporation in the Philippines with responsibility over corporate and technical matters, development of exploration strategy and acquisitions. He is President and Director of Tirex Resources Ltd. and previously held the position of Vice President for Exploration of Panoro Minerals Ltd. where he directed the resource definition drilling of its two major copper projects in Peru. He is also active as a director with Coronet Resources Inc.


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