Talon Receives US$4 Million Unsecured Loan from Kennecott Exploration

Talon Metals Corp. (TSX:TLO) announced that Kennecott Exploration Company, a subsidiary of Rio Tinto Group, has provided it with an unsecured loan for the amount of US$4,000,000. The company will use the funds for exploration activities and to make certain land option payments to Tamarack nickel-copper-PGE project in Minnesota.

As quoted in the press release:

Kennecott also agreed to defer a US$2,500,000 option payment due by Talon on June 26, 2015 pursuant to the Exploration and Option Agreement dated June 25, 2014 between Talon Nickel (USA) LLC (a subsidiary of Talon) and Kennecott until December 21, 2015; and not make any cash calls from Talon beyond the amount of the Unsecured Loan until the fourth quarter of 2015.

As a result of the above, Talon has time to pursue various funding options to enable the Company to finance its funding and payment obligations under the Earn-in Agreement in order to acquire a 30% interest in the Tamarack project and will remain in good standing under the terms of the Earn-in Agreement.

Henri van Rooyen, CEO of Talon Metals, commented:

This funding arrangement, whereby Kennecott has effectively agreed to fund ongoing and future activities at Tamarack on Talon’s behalf, demonstrates Kennecott’s commitment to the Tamarack Project and the strength of its relationship with Talon. Despite having no obligations to do so, and in the spirit of true partnership, Kennecott has agreed to provide Talon with the time it needs to arrange for financing on reasonable terms in these challenging capital markets for junior exploration companies.  At the same time, Talon and Kennecott both recognize the importance of continued exploration at Tamarack, and consequently, Kennecott has agreed to fund ongoing and future exploration expenditures at Tamarack on Talon’s behalf.

Click here to read the full Talon Metals Corp. (TSX:TLO) press release.