Dec 10 2012
Tigris Uranium Corp., and Wolfpack Gold Corp. ("Wolfpack") are pleased to announce that Tigris has determined to diversify its business focus, while maintaining its exposure and commitment to the long term viability of the uranium market.
To this end, Tigris has made an investment in NexGen Energy Ltd. ("NexGen") and has entered into a non-binding letter of intent, dated effective November 30, 2012 (the "LOI"), with Wolfpack, whereby Tigris has agreed to acquire all of the issued and outstanding shares of Wolfpack (the "Transaction").
The Transaction will constitute a Reverse Takeover (as defined in the policies of the TSX Venture Exchange (the "TSXV")) of Tigris by Wolfpack. Upon completion of the Transaction, it is expected that the combined entity will continue to be classified as a mining issuer on the TSXV.
Uranium Activities and Sector Outlook
Tigris remains committed to the positive long term opportunities within the uranium sector but is keenly aware of the short and potentially medium term issues facing the nuclear industry. Currently the uranium sector has been experiencing steadily declining prices, posing substantial short term challenges. Various sources suggest no significant supply-demand imbalances on the horizon, which would, if present, lead to higher prices. The singular bright spot for investors in the uranium sector of late has been confined to the relative select group of companies making significant discoveries of high grade uranium primarily in the Athabasca Basin of Canada. The prospects for lower grade in-situ projects has been dimmed by the continuing low prices for uranium as well as the limited access to capital caused by global economic uncertainties.
Tigris owns a package of quality assets highlighted by the Crownpoint and Hosta Butte uranium projects located in McKinley County, New Mexico which contain indicated mineral resources totalling 26.6 million pounds of U3O8 at an average grade of 0.105% e U3O8 and inferred mineral resources totalling 6.1 million pounds of U3O8 at an average grade of 0.110% e U3O8 (see Tigris' news releases dated May 29, 2012 and June 7, 2012) Although these assets have an annual holding cost of less than $5,000, they have been significantly impaired by the recent decision of Uranium Resources, Inc. (OTCBB: URRE) to defer construction of its neighbouring Churchrock project. This directly adversely affects Tigris as a significant amount of Tigris' uranium inventory is covered under licences held by Uranium Resources.
Consistent with Tigris' long term view on the potential for growth in the uranium market, and the industry's current focus on high grade deposits primarily in the Athabasca Basin, Tigris has agreed to acquire 3,750,000 units ("Units") of NexGen at a price of CDN$0.40 per Unit. Each Unit is comprised of one common share of NexGen (a " Share") and one-half of one Common Share purchase warrant (a "Warrant"), with each whole Warrant entitling the holder thereof to purchase one Share at a price of $0.60 per Share for a period of two years from the date of issuance. NexGen has recently announced a reverse takeover transaction with Clermont Capital Inc. (TSXV: XYZ.P) (see Clermont's news release dated November 30, 2012).
NexGen
NexGen is a uranium exploration company with a portfolio of assets strategically located in the Athabasca Basin, Canada and is focused on discovering the next world class uranium orebody. NexGen's portfolio includes the Radio project. The Radio project is interpreted to be on the same structural trend as Rio Tinto's Roughrider deposit along with the majority of the Canadian projects formerly held by Mega Uranium Ltd. (TSX: MGA), which were recently acquired by NexGen.
Business Combination with Wolfpack
Wolfpack was formed by the combination of assets in the United States from Seabridge Gold Corp. (TSX: SEA) and Golden Predator Corp. (TSX: GPD). Over the past few years, both of these advanced gold exploration companies have concentrated their efforts in Canada, while maintaining a select portfolio of gold projects in Nevada; one of the leading gold jurisdictions of the world. Most of these projects have seen little to no exploration since the price of gold was below $400/oz. The package of gold assets includes several projects that saw production from open pit heap leach operations during the late 1980s to mid-1990s. Several of these projects host historic resources, and the report titled "Castle Black Rock Project Castle Zone Resource Evaluation, Esmeralda County, Nevada" dated July 9, 2012 (amended September 27, 2012) estimates the total inferred resources for the Castle Zone at the property to be 14,683,000 tonnes of mineralized material with gold grading 0.45 g/t, at a cutoff grade of 0.25 g/t.
Name Change
On completion of the Transaction, Tigris plans to change its name to "Wolfpack Gold Corp." or such other name as may be approved by its board of directors.
Rationale
By combining advanced uranium assets with a quality package of gold exploration projects, including a treasury of approximately $9.5 million in cash and investments, the combined entity will provide shareholders with value and liquidity through current and ongoing gold exploration as well as long term benefits derived from the significant uranium assets. The technical team leading this effort combines the strengths of both companies resulting in a highly qualified technical team with specialty expertise in Nevada gold systems as well as uranium deposits.
The Technical Team
The combined entity will be led by Nathan Tewalt BSc, CEO who led the team along with Tom Chadwick BSc, CPG, VP Exploration and Richard Rukavina BSc, Permitting and Project Management, responsible for the discovery of the Hollister and Rossi (Storm) deposits on the Carlin Trend in Nevada while in the employ of Great Basin Gold Ltd. and FMC Gold Corp. respectively. The technical team is augmented by Mark J. Abrams, MSc, CPG and VP Corporate Development, who has more than 30 years of experience primarily in Nevada with Placer Dome and Agnico Eagle. Douglas Underhill, PhD, CPG, MBA rounds out the technical team and is responsible for Tigris' uranium interests. Dr. Underhill has more than 40 years' experience in mineral exploration, specializing in uranium geology, ISR technology and supply-demand analysis. He has served as Uranium Resource and Production Specialist with the Nuclear Fuel Cycle and Waste Technology Division for the International Atomic Energy Association (IAEA).
Although the combined entity will focus exclusively on advancing its Nevada gold assets, it will maintain its considerable uranium assets and remains confident in the long term value inherent therein.
"This business combination will bring together two successful acknowledged technical teams and a portfolio of quality assets. By combining the established but out-of-favor uranium assets with the advanced gold exploration assets in Nevada we are creating a company with a dynamic future," said Chairman William M. Sheriff. "Shareholders of the new company will benefit from near term success and progress in the gold sector while maintaining the longer term window on Tigris' significant uranium holdings."