Stans Energy Corp Announces MOU for Acquisition of Rudniy Log Specularite Property
ACCESS Newswire
Toronto, Ontario / ACCESSWIRE / December 29, 2014 / Stans Energy Corp. (TSX-V: HRE, OTCQX: HREEF), ("Stans" or the "Company") is pleased to announce that it has entered into a Memorandum of Understanding (the "MOU") for the 100% acquisition of the Rudniy Log specularite property from GRK Metalli Altaya LLC ("GRK MA") a Russian limited liability corporation.
Under the terms of the MOU, Stans and GRK MA (together "the Parties"), have agreed on consideration for the possible development of the Rudniy Log specularite (iron oxide) deposit (the "Deposit"). After preliminary evaluation of the full Technical Economic Assessment prepared according to Russian Standards in 2005 by GRK MA, Stans confirms its intention of conducting the necessary evaluation under NI 43-101 leading to the potential development of the Deposit with the prime goal to secure off take agreements for the micaceous iron oxide products from Rudniy Log for international markets.
Micaceous iron oxide ("MIO") products are used predominantly in anti-corrosive applications in paints and similar industrial coatings.
Stans intends to acquire existing MIO application patents from GRK MA to introduce new products to satisfy the existing demand of global end users. Furthermore there is a possibility to exploit the Nano-technological properties of the MIO products to further extend the anti-corrosive capabilities of current MIO based products.
Micaceous Iron Oxide Market
The world market was estimated at 167,000 metric tonnes natural iron oxide pigments of all types, and 1.13 million metric tonnes of synthetic iron oxide pigments. Thermal decomposition of iron salts or iron compounds and precipitation of iron salts accompanied by oxidation and reduction of organic compounds produce synthetic iron oxide pigments. Recent US import data showed MIO pricing for 2011 @ US$1,107.94/metric tonne and in 2012 @ US$1,059.70.
Pricing for MIO can vary dependent on the size, as well as other physical and chemical characteristics of the Specularite mineralization. GRK MA holds patents in MIO processing that provide further refinement though modification of the crystal size and aspect orientation that increases anti-corrosive capabilities of the coatings. Such refined products can command higher market prices and Stans will undertake consultation with end users to determine definitive pricing. MIO Nanotechnology research conducted by GRK MA R&D subsidiary, Molniya RR LLC, demonstrates that there is a possibility to significantly extend the anti-corrosive capabilities of MIO vis-à-vis current marketed products.
Vadim Veshchezerov, Director of Stans and Investment Director for Rusnano, states, "Once Stans is able to complete the mineral resource confirmation work on the Rudniy Log property, it will be uniquely positioned to capitalize on the extensive expertise and partnerships it has recently established. I congratulate the management team for laying the foundation for a company that will employ and supply global hi-tech industries."
Memorandum of Understanding
The MOU establishes the Parties decision on phased implementation of this project on the following conditions:
Phase 1. Resource estimation -Fourth Quarter of 2015.
1. GRK MA shall provide Stans with all legal and technical documentation on the Deposit, the project and GRK MA, including all patents for industrial application of specularite, on a timely basis.
2. Stans shall then conduct a full geological audit of the Deposit to estimate the mineral resources by the Canadian standard specified in NI 43-101 (standards of disclosure for mineral projects).
3. Stans will earn the right to acquire a 15% participatory interest of GRK MA in exchange for 10,000,000 (ten million) shares of Stans' common stock.
Phase 2. Definitive Feasibility Study design - Fourth Quarter of 2016.
Provided the geological audit of the deposit is acceptable to Stans, then Stans shall be responsible to develop a Definitive Feasibility Study of the project and shall have an option to acquire an additional 35% of participatory interest in GRK MA for the number of shares of Stans' common stock determined in good faith by the Parties on the basis of asset valuation in accordance with the data of the feasibility study.
Phase 3. Construction and the start-up of the mine – Second quarter of 2018.
Stans shall arrange for finance and construction of the mine and shall have an option to acquire up to 100% of GRK ownership. The final decision of the structure of participants' interests in GRK MA and the number of Stans' shares to be owned by the GRK MA shall be determined in good faith by the Parties.
"Stans entering into this MOU represents a fundamental pivot in our operations. This MOU allows us to explore the potential of a unique specialty metals property and associated downstream technologies. The formation of DIDIM Inc., a resident company of the Skolkovo Initiative earlier in 2014, provides the company with an opportunity to fast track downstream development of nanotechnology products and applications for MIO," states Rodney Irwin, Interim President and CEO.
Rudniy Log
The Rudniy Log mineral resource is located in the Altai Republic, Russia, 12 km from the border with Mongolia and 65 km from the regional centre of Kosh-Agach. State Highway M52 and then an unimproved road for 16 km access it.
The project is located in the central part of the Aksai volcano-tectonic depression, within an eight kilometer long, northwest-trending, discontinuous quartz-hematite zone surrounding the Aksai granite massif. The deposit is on the southeastern flank of the quartz-hematite zone, 1.5 km from the northeast contact of the Aksai massif. The Rudniy Log deposit is hosted within acidic lavas and tuffs within the middle member of the upper Aksai Formation.
The Rudniy Log mineral resource is thought to extend approximately 1,700 m along strike, and is divided into three discrete mineralized zones. The Main Zone (No. 1) is a tabular zoned body within a peripheral sericitized and silicified acidic volcanic zone surrounding a mineralized breccia core of massive to fine flaky hematite. Approximately 90% of the defined mineral resources occur within the Main Zone.
In 2002-2003, surface trenches were excavated and approximately 2,800 m of diamond drilling was completed in the northwestern part of the deposit. The trenches were excavated across the deposit spaced approximately 100 m apart and covered a strike length of approximately 850 m. Diamond drilling intersected the mineralization to a depth of approximately 120 m.
The mineral resources have been estimated with the polygonal method on vertical cross sections under the Russian national system for mineral resource estimation. Specularite grades were determined by chemical, mineralogical, and phase analysis of Fe2O3. At a cut-off grade of 20% Fe203, mineral resources are estimated at 8.41 million metric tonnes of specularite mineralization (3.57 million metric tonnes of recoverable material) in the C1 + C2 categories, including 2.38 million tonnes of recoverable material within the C1 category, at an average grade of 45.1% Fe203. P1 and P2 resources have been estimated at 9.43 million tonnes and 31.49 million tonnes, respectively. These calculations have been completed to Russian Standards.
As stated above, the MOU contemplates that Stans will conduct its own independent work at the Deposit to upgrade or verify historical mineral resource estimates to NI 43-101 standards.
Notes:
This section contains historical information only. No National Instrument 43-101 compliant report on these properties has been prepared or is available. The property description is translated from Russian and taken from historical information.
The estimates disclosed are conceptual in nature, and there has been insufficient exploration drilling or sampling conducted to NI 43-101 standards to define a mineral resource that may be categorized as an indicated, measured, or inferred resource. It is uncertain if further exploration will result in the Deposit or any target within the Deposit being delineated as a mineral resource as defined in NI43-101.
Based on industry experience the Russian category C1 is comparable to 'indicated' under the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) classification system. The category C2 is comparable to 'inferred' under CIM system.
The categories P1 and P2 are comparable to 'potential' under CIM system. Confirmation to CIM standards would require validation, preferably shallow diamond drilling between the current trenches. The source and date of these historical estimates are from a Technical Economic Assessment of the Rudniy Log deposit completed by GRK MA in 2005 and approved by the State Reserves Committee on June 9, 2006.
A qualified person has not done sufficient work to classify the historical estimate as current mineral resources, Stans is not treating the historical estimate as current mineral resources and the historical estimate should not be relied upon.
LEGAL UPDATE
Stans maintains the arrest of 47,000,000 Centerra Gold shares in the matter against Kyrgyzaltyn and the Kyrgyz Republic. Legal challenges brought by the Kyrgyz Republic against the jurisdiction and the award of the Moscow Chamber of Commerce and Industry continue to be heard in Moscow with further hearings set for January 28, 2015 and February 12, 2015.
Stans' Toronto legal team is nearing completion of filing documents required to start the hearings for seizure of arrested assets of the Kyrgyz Republic at the Ontario Court of Justice. Once those documents will be submitted by Stans legal team, the Court of Justice will set a first date in the matter.
"The Kyrgyz Republic continues to challenge jurisdiction and awards of an internationally regulated tribunal. Stans maintains that these challenges are diversionary in nature and do not relate to the current case before the Ontario Court of Justice. Should the Company successful in obtaining the awarded amount, the plan is to do a distribution back to shareholders of a majority of the proceeds while keeping a small portion of the funds for future project development," states Rodney Irwin, Stans Interim President and CEO.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Dr. Douglas Underhill, a Qualified Person, and director of Stans, has reviewed and approved the scientific and technical information contained in this release. The properties described have not been the subject of any National Instrument 43-101 report, and Dr. Underhill has not verified the scientific or technical documents disclosed in this release.
Contact Details
Rodney Irwin Stans Energy Corp Interim President & CEO rodney@stansenergy.com 647-426-1865
David Vinokurov Stans Energy Corp VP Corporate Development david@stansenergy.com 647-426-1865
FORWARD LOOKING STATEMENTS:
This document includes forward-looking statements as well as historical information. Forward-looking statements include, but are not limited to, use of proceeds from the Offering, the completion of the Offering, the continued advancement of the company's general business development, research development and the company's development of mineral exploration projects. When used in this press release, the words "will", "shall", "anticipate", "believe", "estimate", "expect", "intent", "may", "project", "plan", "should" and similar expressions may identify forward-looking statements. Although Stans Energy Corp. believes that their expectations reflected in these forward looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statement. Important factors that could cause actual results to differ from these forward-looking statements include the potential that fluctuations in the marketplace for the sale of minerals, the inability to implement corporate strategies, the ability to obtain financing and other risks disclosed in our filings made with Canadian Securities Regulators.
