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Be the first with the news that moves the market- ZincX Resources (TSXV:ZNX) will receive funding help from Tongling Non-Ferrous Metals for its 2020 drill program
- Proceeds from the program will convert into ZincX shares at C$0.30 each, which the company will then issue to Tongling
- Tongling is an existing shareholder in ZincX, with a current 28.55 per cent interest
- The program, which will occur at the Akie property, will provide new drill core samples for metallurgical testing
- ZincX Resources (ZNX) is up 28.57 per cent to 9 cents per share, with a market cap of C$15.33 million
ZincX Resources (TSXV:ZNX) will receive funding help from Tongling Non-Ferrous Metals for its 2020 drill program.
China-based Tongling is ZincX’s largest institutional investor, with 48,636,224 common shares, representing a 28.55 per cent stake.
The companies have maintained regular communication between the two of them since an initial meeting in Vancouver in July 2019. ZincX’s technical team has since been working with Tongling to design a work program and agreement for the upcoming season.
The company will conduct the program at ZincX’s wholly owned Akie property in northeastern British Columbia. Previous drilling at the site has revealed a significant body of baritic-zinc-lead mineralization, known as the Cardiac Creek deposit.
Three holes are expected to be drilled, totalling approximately 2,000 metres. Mineralised drill core samples will then be used for advanced metallurgical testing, which Tongling will conduct.
ZincX Resources’ CEO, Peeyush Varshney, said the long-standing relationship with Tongling has been mutually beneficial.
“They have provided guidance and technical expertise over the years, which have helped shape exploration at the Akie Project.
“Today we announce an increased level of participation, which is most welcome in these challenging global market conditions,” he added.
Preliminary discussions between the two companies have more or less settled on a proceed-conversion agreement. Under this, the proceeds from the drill program will convert into common shares of ZincX at a price of C$0.30. This is a 400 per cent premium over the company’s current share price.
As a result, Tongling would effectively increase its investment in ZincX by an additional $1.398 million.
“Tongling last toured the Akie property in 2018. To this day, it recognises the inherent value of the company’s significant prospective land package and the potential long-term district development opportunity,” Varshney concluded.
ZincX Resources (ZNX) is currently up 28.57 per cent to 9 cents per share at 1:51pm EST.
