Altius Minerals has transferred its Lynx diamond project to its private subsidiary Adia Resources, which will have the option to earn 100-percent interest in Lynx.
In an effort to speed up exploration and future production, Altius Minerals (TSX:ALS) has transferred its Lynx diamond project to its private subsidiary Adia Resources.
The newly formed Adia will now hold the option once held by Altius, to earn 100-percent interest in Lynx. Meanwhile, Altius will retain a 2.5 percent gross overriding royalty on diamond proceeds from the project.
The Lynx site is the first diamond project in Manitoba and has the potential to usher in an era of diamond exploration and production in the prairie province.
Private subsidiary Adia has secured a C$2-million private placement at C$0.50 per share through third party investors, including several large diamond exploration companies.
Additionally, Adia has entered into an equity participation and support agreement with De Beers Canada.
According to the company press release, under this agreement, De Beers has committed to contribute C$1.5 million (at a deemed price of C$0.50 per share) in in-kind services and support to Adia in the form of third party and proprietary airborne and heliborne geophysical surveys, microdiamond analysis (MiDA), grade estimation/diamond characterization and other specialist services.
In return for its investment, De Beers will acquire a pro rata participation right in future equity financings. De Beers will also hold a 15.4-percent stake in Adia.
Altius had been exploring the Lynx site since early 2017, and made several discoveries during the time. To date, sampling and test work in the Eastern Bay has unearthed 1,693 microdiamonds from 15 samples.
Using the already conducted samplings and target zones, Adia will now begin to implement its three-phase exploration program. Phase one, which is already underway will include geophysics and mapping. Phase two, will include drilling, microdiamond analysis, 3D modelling and mini-bulk sampling.
The final phase, three, will focus on bulk sampling for macro-diamonds.
As of 1:00 p.m. EST on Monday (September 24), Altius shares were up 0.53 percent, trading at C$13.18.
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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.