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CoTec, BMR Enter Non-Binding Framework for Potential Punitaqui Joint Venture

CoTec Holdings and Battery Mineral Resources will assess potential copper production and development opportunities at BMR’s Punitaqui mining district under a non-binding framework agreement.

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CoTec Holdings Corp. and Battery Mineral Resources Corp. have entered into a non-binding framework agreement to assess additional copper production and development opportunities at the Punitaqui mining district in Chile. The proposed work would examine the use of technologies identified, sourced or made available by CoTec.

The framework creates a pathway toward a potential Strategic Economic Joint Venture. Its formation remains subject to technical and economic evaluations, followed by negotiations on definitive agreements.

#Scope of the proposed partnership

The parties plan to evaluate BMR’s existing resources, lower-grade sulphide mineralisation, historical and active tailings, and other opportunities across the Punitaqui district. The assessment will consider copper recovery, recovery improvements, additional production opportunities and possible new development projects.

BMR would contribute its producing copper operation, infrastructure, permits, workforce and resource base. CoTec would provide capabilities in technology identification and sourcing, resource optimisation, project development and financing.

#Proposed value-sharing arrangement

Under the proposed framework, BMR would retain 100% ownership and economic benefit from its existing Punitaqui operation. This would include current resources, production and mine plans, measured against a baseline that the parties have yet to agree.

CoTec and BMR would each receive 50% economic participation in incremental production and value generated through the application of CoTec technologies. The same proposed split would apply to qualifying new development opportunities identified through CoTec’s technology-related activities.

#Initial assessment and funding

The initial programme is expected to include metallurgical testing and preliminary technical and economic evaluations. The work will examine whether additional copper can be recovered from tailings, assess lower-grade mineralisation, consider improvements in recoveries and evaluate potential new copper production streams.

CoTec is expected to cover third-party costs for initial assessment and testing activities that it approves. The framework agreement is non-binding apart from provisions covering exclusivity, confidentiality and other customary matters. Further terms apply to the proposed transaction.

After the technical, metallurgical and economic work is completed, the companies intend to negotiate definitive agreements for the proposed Strategic Economic Joint Venture and qualifying opportunities within the Punitaqui district. The potential joint venture remains subject to completion of those evaluations and the negotiation of those agreements.

#Management comments

CoTec Chief Executive Officer Julian Treger said the company sees opportunities to apply its resource optimisation and processing solutions to existing resources, lower-grade sulphides and tailings at Punitaqui.

Battery Mineral Resources Chief Executive Officer Lazaros Nikeas said the company intends to assess lower-grade sulphide mineralisation, tailings and other opportunities across the district alongside CoTec.

#Company background

CoTec Holdings Corp. trades on the TSXV under CTH and on the OTCQX under CTHCF. Its stated focus includes rare earth magnets, strategic materials and technologies applied to marginal assets, tailings, waste streams and recycled products.

Battery Mineral Resources Corp. operates the Punitaqui Mining Complex in Chile’s Coquimbo region. Its portfolio also includes 100%-owned ESI Energy Services Inc. and North American mineral exploration assets. BMR trades on the TSXV under BMR and on the OTCQB under BTRMF.

#Risks and conditions

The companies said the proposal involves forward-looking information and that actual results could differ materially from current expectations. Risks identified include technical and metallurgical issues, the possibility that definitive agreements may not be completed, and the possibility that the proposed technologies may not achieve anticipated results.

Other risks include resource and reserve uncertainty, environmental risks and costs, permitting requirements and delays, financing availability, changes in commodity prices and operating costs, labour costs and shortages, equipment availability, project delays, cost overruns and extreme weather conditions.

The companies also identified assumptions concerning continued cooperation, the availability and effectiveness of CoTec technologies, completion of the technical and economic evaluations, necessary financing, applicable commodity prices and operating costs, and required regulatory and permitting approvals.

#Key Takeaways

  • CoTec and Battery Mineral Resources have entered a non-binding framework for a potential Strategic Economic Joint Venture at Punitaqui in Chile.
  • The parties will assess copper recovery, lower-grade sulphide mineralisation, tailings and possible new production or development opportunities.
  • BMR would retain 100% ownership and economic benefit of its existing Punitaqui operation under the proposed structure.
  • CoTec and BMR would each have 50% economic participation in qualifying incremental production and value created through CoTec technologies and related new opportunities.
  • The potential joint venture remains subject to technical and economic evaluations and the negotiation of definitive agreements.

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