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North American Palladium Acquires a 51% Interest in the Sunday Lake PGM Project

Aug 19, 2019

North American Palladium Acquires a 51% Interest in the Sunday Lake PGM Project`
North American Palladium Ltd.  announced it has acquired a 51% interest in the Sunday Lake Platinum Group Metal (PGM) Project, located 25 km north of Thunder Bay and approximately 60 km south of NAPs's Lac des Iles Mine operations. 
 
The acquistion represents the first stage of a three stage acquisition process which will see North American Palladium acquire 75 % ownership in Sunday Lake once all the conditions in the agreement are met.
 
North American Palladium is the world’s only pure play palladium producer. With over 700 employees, the Lac des Iles Mine features a unique, world-class ore body and modern infrastructure, including both an underground mine and surface operations.
 
NAP's decision to elect to continue investing in the Sunday Lake platinum group metal project was supported by encouraging drilling results from the PGM Zone, including the best intersection reported to date (41.2 m grading 3.22 g/t of platinum, 2.08 g/t palladium  and 0.21 g/t gold in drill hole SL-19-026). 
 
After completing two winter drilling programs,  NAP has exceeded the mandated two-year exploration expenditure requirement and has completed the requisite cash payments to its partners, comprising $675,000 to Impala Platinum Holdings Limited and $75,000 to Transition Metals Corp. 
 
Prior to NAP vesting a 51% interest, the Project was a joint venture between Transition and Implats, whereby Impala held a 75% interest and Transition held a 25% free carried interest until the completion of a Feasibility Study, at which time Transition’s interest would convert to a 25% participatory interest.
 
 Impala's interest in the joint venture has now been reduced to 24% while Transition maintains a 25% free carried interest through to the completion of a Feasibility Study.
 
“We are very pleased to partner with Impala and Transition on the Sunday Lake Project, which is NAP’s best blue-sky opportunity and a key element of our long-term strategy to build an inventory of high-quality platinum group metal assets in the Thunder Bay region, " Jim Gallagher, President and CEO of NAP.  "We have demonstrated that the PGM Zone has significant lateral continuity and are now able to focus on areas of enhanced thickness and grade.”
 
Background 
On June 20, 2017, Transition and Impala collectively signed an Option Agreement with NAP. The Agreement provides NAP with the exclusive right to acquireImpala’s 75% ownership in the Sunday Lake Project by completing a three-stage exploration expenditures and cash payments.
 
Stage 1: NAP was entitled to acquire a 51% interest in the property by investing $1.5M in exploration expenditures and making cash payments of $75,000 to Transition and $675,000 to Impala  within a two-year period. This stage has now been completed.
 
Stage 2: NAP may increase its interest from 51% to 65% by investing an additional $2.5M in exploration expenditures and making further cash payments of $125,000 to Transition and $1.125M to Impala  within a two-year period.
 
Stage 3: NAP may further increase its interest from 65% to 75% by investing an additional $0.5M in exploration expenditures and making final cash payments of $150,000 to Transition and $1.35M to Impala  within a one-year period.
 
North American Palladium is a Canadian company with 25 years of production at the Lac des Iles Mine in a low-risk jurisdiction northwest of Thunder Bay, Ontario. 
 
The Sunday Lake propety contains an intrusion, which is part of the Proterozoic Mid-Continental Rift magmatic event that produced the Eagle nickel deposit in Michigan (Lundin Mining) and the Tamarack (Rio Tinto – Talon Resources) and Duluth Complex (Antofagasta PLC) magmatic sulphide deposits in Minnesota.