Big Daddy, ON.
Photo by: KWG Resources
TORONTO (miningweekly.com) – TSX-V-listed junior project developer KWG Resources on Monday announced that it had signed an agreement to acquire half of the ownership rights in two US provisional patent applications related to producing chromium-iron alloys directly from chromite ore, and low-carbon chromium-iron alloys directly from chromite concentrates.
The Toronto-based company, which is focused on developing its 30% interest in the Big Daddy chromite deposit and earning in to its 80% interest in the Black Horse chromite project, both located in the Ring of Fire chromite camp of Northern Ontario, said that the transaction would include the right to use these provisional patent applications as the basis for filing other patent applications in the US, Canada and elsewhere.
KWG and the vendor of the intellectual properties would create a limited partnership under which the patents would be held and exploited.
The vendor had agreed to assign its 50% interest in the chromium patent to the partnership in exchange for 25-million units of KWG, and each unit would consist of a common KWG share and one common share purchase warrant of KWG, exercisable at a strike price of $0.10 for five years from the closing date of the transaction.
KWG reported that it would have the option to acquire another 25% interest in the intellectual property from the vendor for another 12.5-million units at any time within a year from closing.
Should KWG exercise this first option, it would unlock an additional option to acquire the vendor's remaining 25% interest in the patent for another 12.5-million units to the vendor within a year after the exercise of the first option.
In November, KWG announced that it was “encouraged” with the results of ongoing metallurgical testwork to determine the thermodynamics of metallising the chromite from the Black Horse deposit that formed part of KWG's Koper Lake project, through its reduction with natural gas.
The closing of the transaction is subject to TSX-V approval.
KWG had also applied for approval to launch another flow-through private placement of 2.2-million units for total proceeds of $220 000. Each unit would comprise one flow-through treasury share and one warrant that may be exercised to acquire a further flow-through share for $0.15 in the preceding year.