FREDERICTON, NB, Oct. 3, 2013 /CNW/ - Northcliff Resources Ltd. ("Northcliff" or the "Company") (TSX: NCF) and
Todd Minerals Ltd. ("Todd") are pleased to announce that they have
entered into agreements for Todd to provide up to $39 million in
funding for the Sisson Tungsten-Molybdenum Project (the "Sisson
Project") located in central New Brunswick, Canada, in exchange for a
direct interest in the Sisson Project and shares in Northcliff. Todd is
a subsidiary of the family owned Todd Corporation, one of New Zealand's
most successful companies and which has a growing portfolio of mineral
Details of the investment by Todd are:
Investment in Northcliff
Todd will complete a private placement and will acquire ownership and
control of 13,888,889 common shares of Northcliff for $5 million, at a
share price of $0.36 per share. The price paid for the private
placement represents a 20 percent premium to the 30 day volume-weighted
average price on the Toronto Stock Exchange prior to announcement. Todd
will become the largest shareholder of the Company with an approximate
15% interest in Northcliff and Todd will have the right to nominate a
board member to the Northcliff board and the right to maintain its 15%
shareholding in Northcliff by participating pro rata in any future
common share offering of Northcliff. Todd has agreed that it will not,
subject to certain exceptions, sell its shares in Northcliff until 24
months after closing of the investment.
Sisson Project Interest
Todd and Northcliff will enter into a limited partnership agreement
under the name of the Sisson Project Limited Partnership (the "Limited
Partnership") to advance and operate the Sisson Project.
Todd will have the right to acquire an initial 11.5% interest in the
Limited Partnership by investing $14 million on a staged basis. Failure
to complete the full $14 million investment will result in Todd
divesting its entire interest in the Limited Partnership.
Todd's initial investment will be made in three tranches with the first
tranche of $5 million to be made on the execution date of the Limited
Partnership agreement. The remaining two investment tranches of $5
million and $4 million are to be made by Todd upon completion of agreed
Todd holds an option to acquire an additional 10% interest in the
Limited Partnership (for a total potential interest of 21.5% in the
Limited Partnership) by investing $20 million in the Limited
Partnership upon a final investment decision to commence construction.
To the extent that Todd's investment has, from time to time, been
exhausted to fund project expenses, Todd and Northcliff will each be
required to fund their pro rata portions of the development capital of
the Sisson Project.
Todd and Northcliff will have pro rata representation on the board of
the General Partner of the Limited Partnership.
Northcliff will be the operator of the Sisson Project under the terms of
a management services agreement with the General Partner of the Limited
Northcliff President & CEO Chris Zahovskis said, "We are extremely
pleased to have Todd join us at this important stage of the Sisson
Project's advancement. Tungsten market fundamentals remain strong with
robust prices and continued supply restrictions out of China. These
factors underpin the investment case for advanced tungsten deposits in
low risk jurisdictions. Todd is an important strategic investor in the
Sisson Project as Northcliff sets out to permit, build and operate the
Sisson mine in New Brunswick."
Todd Group CEO, Jon Young said, "Todd is pleased to be associated with
the Sisson Project which, once developed, will be a significant new
tungsten producer. The investment is consistent with Todd's strategy of
partnering with proven operators to develop long-term projects."
Zahovskis also noted "The initial funding from Todd totaling up to $19
million is earmarked for ongoing environmental work to support the
harmonized Environmental Impact Assessment process currently being
undertaken by the federal and provincial governments, as well as
furthering design and engineering studies to advance planning from the
feasibility study completed earlier this year, sourcing project
financing and off-take arrangements."
The positive feasibility study on the Sisson Project (see Northcliff
news release dated January 29, 2013) confirmed the technical and
economic robustness of the long-life open pit development and its
potential to be a strategic near-term tungsten development in a stable
jurisdiction. The study, prepared by Samuel Engineering, Inc.
estimated annual average production of 557,000 mtu WO3 contained in APT and 4.1 million pounds Mo contained in concentrates
over 27 years of operation based on a 30,000 tonne per day mill
throughput1. The Sisson Project is expected to employ at least 300 people in New
Brunswick with up to 500 during the construction phase.
Northcliff Chairman Marchand Snyman said "The investment by Todd, which
has an excellent track record of managing and investing in diverse
fields for more than a century is a testament to the work done on the
Sisson Project by the Northcliff team. We welcome Todd's participation
in the Sisson Project as a long term partner."
The transaction is subject to regulatory approvals and is scheduled to
close in early October.
About Northcliff Resources Ltd.
Northcliff, associated with Hunter Dickinson Inc. (HDI), is a mineral
resource company focused on advancing the Sisson Tungsten-Molybdenum
Project located in New Brunswick, Canada, to production. The results of
the Feasibility Study, completed in January 2013, confirm that the
Sisson Project is technically and economically feasible and can now
move on to the next stage of development. For further details on
Northcliff and the Sisson Tungsten-Molybdenum Project please visit
Northcliff's website: www.northcliffresources.com.
About Todd Minerals Ltd. and Todd Corporation
Todd is the subsidiary of Todd Corporation charged with the development
of Todd Corporation's mineral and coal investments. Todd Corporation is
family owned and is one of New Zealand's largest and most successful
companies. The company has interests in oil and gas exploration and
production, electricity generation, energy retailing, property
development, healthcare, telecommunications and wine. Todd Minerals
Ltd. is headquartered at The Todd Building, 95 Customhouse Quay, PO Box
3141, Wellington, New Zealand. Todd has agreed to purchase the
Northcliff common shares for investment purposes and may or may not
purchase or sell Northcliff securities in the future on the open market
or in private transactions, depending on market conditions and other
factors. The Northcliff securities were acquired pursuant to the
minimum amount investment exemption under applicable securities laws. A copy of the early warning report to be filed by Todd in connection
with the investment will be available on Northcliff's profile on SEDAR
at www.sedar.com or contact Mike Munro at +64 4 917 8852.
Chris Zahovskis, President & CEO
Northcliff Resources Ltd.
Jon Young, Group Chief Executive Officer
The Todd Corporation Limited
This release includes certain statements that may be deemed
"forward-looking statements". All statements in this release, other
than statements of historical facts, that address permitting,
exploration drilling, exploitation activities and events or
developments that the Company expects, are forward-looking statements.
Although the Company believes the expectations expressed in such
forward-looking statements are based on reasonable assumptions, such
statements are not guarantees of future performance and actual results
or developments may differ materially from those in the forward-looking
statements. Assumptions used by the Company to develop forward-looking
statements include the following: the transaction with Todd will close
on a timely basis, the Sisson Project will achieve targeted production
levels; the Company's study and development of the Sisson Project will
continue to be positive; contracted parties provide goods and/or
services on the agreed timeframes; equipment necessary for construction
and development is available and does not incur unforeseen breakdowns;
no material labour slowdowns or strikes are incurred; plant and
equipment functions as specified; geological or financial parameters do
not necessitate future mine plan changes; and no geological or
technical problems occur. Factors that could cause actual results to
differ materially from those in forward-looking statements include
uncertainty of shareholder support, the need for judicial and
regulatory approvals, inability of the Company and Todd to achieve
fulfillment of all conditions under the definitive agreements with
respect to the transactions described herein, fluctuations in market
prices, exploitation and exploration successes, continuity of
mineralization, potential environmental issues and liabilities
associated with exploration, development and mining activities,
uncertainties related to the ability to obtain necessary environmental,
land use and other permits, approvals, licenses and title on a timely
basis and delays due to third party opposition, changes in government
policies regarding mining and natural resource exploration and
exploitation, continued availability of capital and financing, and
general economic, market or business conditions. Investors are
cautioned that any such statements are not guarantees of future
performance and actual results or developments may differ materially
from those projected in the forward-looking statements. For more
information on the Company, investors should review the Company's
continuous disclosure filings that are available at www.sedar.com.
1 mtu is metric tonne units and APT is ammonium paratungstate.
SOURCE: Northcliff Resources Ltd.
For further information:
Dan Gibbons, Investor Relations
Northcliff Resources Ltd.
Mike Munro, Group Manager Corporate Affairs
The Todd Corporation Limited
+64 4 917 8852