Vancouver, British Columbia, August 26, 2021 – Silver Elephant Mining Corp. (“Silver Elephant” or “the Company”) (TSX: ELEF, OTCQX:SILEF, Frankfurt:1P2N) announces that it has entered into 2% royalty agreements (the “Royalty Agreements”) whereby the Company now holds a 2% royalty over each of the Company’s key projects (the “Royalties”), and, in connection with the previously announced spin-out and plan of arrangement of the Company (the “Arrangement”), such Royalties will be transferred into a newly incorporated wholly-owned subsidiary of the Company named Battery Metals Royalties Corp. (“Battery Metals Royalties”).
Pursuant to the Royalty Agreements and in connection with the Arrangement, Silver Elephant and its subsidiaries shall place the Royalties, which primarily consists of 2% net smelter return royalty over the Company’s Minago nickel project, 2% royalty over the Company’s Gibellini vanadium project, and 2% net smelter return royalty over the Company’s Pulacayo silver project, into Battery Metals Royalties.
In all but one case, the Royalties are payable to Battery Metals Royalties only when the price of the underlying metal in the mining project has been reached (“Threshold Prices”). The Threshold Prices have been set well above current metal prices by design to minimize the Royalties’ impact on future mine construction decisions.
| Project, all 100% | Country | 43-101 Resource (1) | Royalty Payment, Threshold Price (8) |
|---|---|---|---|
| Minago Nickel | Manitoba, Canada |
722 million lbs Ni (I) (2) 319 million lbs Ni (Inf) (2) |
2% when Nickel is over $15/lb |
| Gibellini Vanadium | Nevada, USA |
131 million lbs V2O5 (M&I) (3) 94 million lbs V2O5 (Inf) (3) |
2% when V2O5 is over $12/lb |
| Pulacayo Silver-Lead-Zinc | Potosi, Bolivia |
107million oz Ag (I) (4) 1,410 million lbs Zn (I) (4) 690 million lbs Pb (I) (4) |
2% when Silver is over $30/oz |
| El Triunfo Gold-Silver | Bolivia | N/A | 2% when Silver is over $30/oz |
| Titan Iron Vanadium | Canada | 434 million lbs V2O5 (Inf) (5) | 2% when V2O5 is over $12/lb |
| Ulaan Ovoo Coal Chandgana Coal |
Mongolia | 20.7 million tonnes (Proven) (6) 124 million tonnes (Measured) (7) |
$2 per tonne of coal sold no Threshold Price |
Notes
It is expected that upon completion of the Arrangement, Battery Metals Royalties will be managed by John Lee, CFA. Mr. Lee has over 20 years of experience in metals and mining. Battery Metals Royalties will focus on mining investments in nickel, vanadium, silver, copper, and gold, and seek to leverage Mr. Lee’s extensive network to locate opportunities before they become mainstream.
In the past decade, Mr. Lee visited well over 50 mining projects around the world and led Silver Elephant in the acquisition of over 15 mining properties in Canada, US, Bolivia, and Asia. Mr. Lee has helped raised over $120 million in equity financings for Silver Elephant, a skill which he will apply to grow Battery Metal Royalties.
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Qualified Persons
The technical contents of this news release have been prepared under the supervision of Danniel Oosterman, VP Exploration for Silver Elephant. Mr. Oosterman is a “qualified person” as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and is not independent of the Company as this term is defined under NI 43-101.
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