Teck 75% / Copper Fox 25% of Schaft Creek Joint
Venture
Copper Fox will host an investor and analyst conference call
at
10:00 am (PDT), Wednesday, July 17, 2013
Dial-in at 1-888-231-8191
VANCOUVER, July 16, 2013 /CNW/ - Copper Fox Metals Inc.
("Copper Fox") (TSX-V: CUU) today announced the formation of
a joint venture (the "Schaft Creek Joint Venture") with Teck
Resources Limited ("Teck") to further explore and develop the
Schaft Creek project located in northwestern British Columbia, Canada.
"This partnership is a key milestone for Copper
Fox Metals and reflects the spirit of the 2002 Option Agreement
with Teck," says Elmer Stewart,
President and CEO of Copper Fox. "We are pleased to have Teck
as our partner and look forward to the next phase of our
relationship. The terms of the Schaft Creek Joint Venture Agreement
reflect the advanced stage of the project, and with Teck's
expertise in the development and operation of large mining projects
and strong commitment to responsible mining we are confident the
Schaft Creek project will continue to benefit the Tahltan people,
local communities and shareholders.
This agreement gives Copper Fox immediate access
to funds and a viable partner to continue the work we have done on
the Schaft Creek property without diluting Copper Fox's 25%
interest in the Schaft Creek Joint Venture. With Teck's
agreement to fund future costs, we have reduced the uncertainty
around Copper Fox's future expenditures for the project."
Dale Andres,
Senior Vice President, Copper for Teck, commented "This agreement
represents an important milestone for our relationship with Copper
Fox. We are pleased with the progress they have made and
believe they will continue to be a valuable partner going
forward."
Terms of the Agreement
- The agreement replaces and supersedes the 2002 option and joint
venture agreement between Teck and Copper Fox in connection with
Schaft Creek.
- Teck will hold a 75% interest and Copper Fox will hold 25% in
the Schaft Creek Joint Venture.
- Teck will be the operator of the Schaft Creek Joint
Venture.
- Teck will pay a total of $60
million in three direct cash payments to Copper Fox:
$20 million upon signing the Schaft
Creek Joint Venture Agreement, $20
million upon a Production Decision, and $20 million upon the completion of the mine
facility.
- In addition, Teck will fund 100% of costs incurred prior to a
production decision up to $60
million; Copper Fox's pro rata share of any pre-production
costs in excess of $60 million will
be funded by Teck and the direct cash payments payable to Copper
Fox will be reduced by an equivalent amount, and Teck will fund any
additional costs incurred prior to a production decision, if
required, by way of loan to Copper Fox to the extent of its pro
rata share, without dilution to Copper Fox's 25% joint venture
interest.
- On signing Teck will reimburse $3.93
million for Schaft Creek mineral tenure acquisition costs
and costs related to Stewart Bulk Terminal land reservation
agreement incurred by Copper Fox.
- Management of the Joint Venture will be made up of two
representatives from Teck and Copper Fox with voting proportional
to equity interests.
- Teck has agreed to use all reasonable commercial efforts to
arrange project equity and debt financing for project capital costs
of constructing a mining operation upon a production decision being
made; Teck has agreed to fund Copper Fox's pro rata share of
project capital costs by way of loan, if requested by Copper Fox,
without dilution to Copper Fox's 25% joint venture interest.
Teck and Copper Fox's Interest in the Liard
Shares
The shares representing the 78% interest in
Liard Copper Mines Limited ("Liard") that are included in the
Schaft Creek Joint Venture will be held in the name of Teck for the
benefit of Copper Fox (25%) and Teck (75%). Liard holds a 30%
net profits interest in the Schaft Creek property.
Summer 2013 Exploration Program
The Schaft Creek Joint Venture intends to
approve a Phase I, 2013 summer program aimed at increasing the
value of the Schaft Creek project. The program will consist
of approximately 10,000 metres of diamond drilling and geotechnical
studies. The objective of the drill program is to test the
extension to the east of the mineralization in the Paramount Zone
and to collect additional geotechnical information for ongoing pit
slope stability studies. Drilling is expected to begin before the
end of July 2013.
BC Hydro Agreement
In March 2013,
Copper Fox entered into a Facilities Study Agreement with the
British Columbia Hydro and Power Authority ("BC Hydro") to assess
the electrical and equipment requirements to connect the Schaft
Creek project to the forthcoming BC Hydro Bob Quinn electrical
substation.
Joint Venture Agreement on SEDAR
The full terms of the Schaft Creek Joint Venture
are set out in the definitive Joint Venture Agreement between
Copper Fox and Teck dated July 15,
2013. A copy of the Agreement will be made available
under Copper Fox's profile on Sedar at www.sedar.com.
About Copper Fox
Copper Fox is a Canadian based resource
development company listed on the TSX-Venture Exchange (TSX-V: CUU)
with a corporate office in Calgary,
Alberta and an operations office in Vancouver, British Columbia. In addition
to Copper Fox's interest in the Schaft Creek Joint Venture, Copper
Fox holds, through its wholly-owned subsidiaries, mineral tenures
located in Pinal County, Arizona
(the 'Sombrero Butte Copper Project') and in Miami, Arizona (the 'Van Dyke BLM
Claims'). The Sombrero Butte copper project consists of 2,887
acres located in the Bunker Hill Mining District, 44 miles
northeast of Tucson and the 35 Van
Dyke BLM Claims are located to the west of the Van Dyke copper
deposit in Miami, Arizona.
For further information on these mining projects, please refer to
the July 9, 2012 and April 12, 2013 news releases found at the
Company's website at www.copperfoxmetals.com.
On behalf of the Board of Directors,
Elmer B.
Stewart
President and Chief Executive Officer
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
Cautionary Note Regarding Forward-Looking
Information
This news release contains "forward-looking
information" within the meaning of the Canadian securities
laws. Forward-looking information is generally identifiable
by use of the words "believes," "may," "plans," "will,"
"anticipates," "intends," "budgets", "could", "estimates",
"expects", "forecasts", "projects" and similar expressions, and the
negative of such expressions. Forward-looking information in
this news release includes statements about the formation, terms
and future activities of the Schaft Creek Joint Venture; further
exploration and development of the Schaft Creek project; direct
cash payments to Copper Fox upon a Production Decision and upon the
completion date of a mine; the timing, scope and objectives for the
2013 summer drilling program; financing to advance the Schaft Creek
project, including project equity and debt financing for projected
capital costs of construction of a mining operation; the
timing and scope of drilling for the 2013 summer program at Schaft
Creek; and the Facilities Study Agreement with BC Hydro.
In connection with the forward-looking
information contained in this news release, Copper Fox has made
numerous assumptions. While Copper Fox considers these
assumptions to be reasonable, these assumptions are inherently
subject to significant uncertainties and contingencies.
Additionally, there are known and unknown risk factors which could
cause Copper Fox's actual results, performance or achievements to
be materially different from any future results, performance or
achievements expressed or implied by the forward-looking
information contained herein. Known risk factors include: the
Schaft Creek Joint Venture may not result in a Production Decision
being made, or the construction of a mine; further exploration and
development of the Schaft Creek property may not occur as expected;
cash payments to Copper Fox may not be paid by Teck in the quantum
or timing expected, or at all; financing commitments may not be
sufficient to advance the Schaft Creek project as expected, or at
all; the timing and scope of the 2013 summer drilling program may
not be initiated or completed as expected; and the Facilities Study
Agreement with BC Hydro may not result in the connection of the
Schaft Creek project to the forthcoming BC Hydro Bob Quinn
electrical substation as currently anticipated.
A more complete discussion of the risks and
uncertainties facing Copper Fox is disclosed in Copper Fox's
continuous disclosure filings with Canadian securities regulatory
authorities at www.sedar.com. All forward-looking information
herein is qualified in its entirety by this cautionary statement,
and Copper Fox disclaims any obligation to revise or update any
such forward-looking information or to publicly announce the result
of any revisions to any of the forward-looking information
contained herein to reflect future results, events or developments,
except as required by law.
SOURCE Copper Fox Metals Inc.