Pan American Energy Corp. Announces Option Agreement for Big Mack Property

Rhea-AI Summary

Pan American Energy Corp. has signed an Option Agreement with Magabra Resources Corporation to acquire a 90% interest in the Big Mack Property located in Ontario. This property contains petalite and rare earth pegmatites, indicative of significant lithium potential. The acquisition involves three phases: Phase One requires C$80,000 in cash, C$200,000 worth of shares, and C$1 million in exploration within a year. Subsequent phases involve additional cash, shares, and exploration expenditures. The deal represents a strategic expansion into the hard rock lithium sector.

Positive

• Acquisition of a 90% interest in the Big Mack Property enhances Pan American's lithium portfolio.
• The property has identified petalite and rare earth pegmatites, suggesting strong mining potential.
• Investment of up to C$2.1 million in exploration and cash payments demonstrates commitment to project development.

Negative

• None.

CALGARY, Alberta, Aug. 23, 2022 (GLOBE NEWSWIRE) -- Pan American Energy Corp. (the “Company” or “Pan American”) (CSE: PNRG) (OTC PINK: PAANF) is pleased to announce that it has entered into a property option agreement (the “Option Agreement”) with Magabra Resources Corporation (the “Vendor”) dated August 22, 2022 (the “Effective Date”), pursuant to which the Company has been granted the right to acquire up to a 90% interest in and to the Big Mack Property, which consists of a single mining lease (LEA-107832) in the Paterson Lake Area located approximately 80 kilometres north of Kenora, Ontario, Canada (the “Property”). The Property occurs within the Separation Lake Greenstone Belt (SLGB) and has been studied by the Ontario Geological Survey and Ontario government for the rare-metal pegmatite potential of the area. Exploration work to date has identified a series of petalite and rare earth pegmatites on the Property.

"This transaction with Magabra Resources Corporation represents another transformational step forward for Pan American Energy Corp" says CEO, Jason Latkowcer. "Adding a hard rock lithium asset to our portfolio diversifies the Company's lithium projects beyond our current Green Energy Lithium brine project in Utah. The Big Mack Project is known for having a series of petalite and rare earth pegmatites including Lithium-Cesium-Tantalum (LCT), with meaningful historical assay records. We would like to thank Perry Heatherington and his team and look forward to collaborating on further exploration and development of the Big Mack Project"

Terms of the Option Agreement

In consideration for a series of cash and share payments, and the incurring of exploration expenditures, separated into three phases, the Company may acquire up to a 90% interest in the Property, as follows:

Phase One

In phase one, the Company shall be entitled to acquire a 51% interest in and to the Property by:

• paying C$80,000 in cash to the Vendor within thirty (30) days following the Effective Date;
• issuing, within sixty (60) days following the Effective Date, such number common shares in the capital of the Company (the “Shares”) to the Vendor having a value equal to C$200,000, calculated on the date of issuance using the market price of the Shares on the Canadian Securities Exchange (the “CSE”) on such date, such Shares being subject to voluntary resale restrictions whereby, subject to applicable securities laws and stock exchange rules, 50% of such Shares shall be released to the Vendor immediately upon the date of issuance, and the remaining 50% shall be released four (4) months after the date of issuance; and
• incurring, within twelve (12) months following the Effective Date, C$1,000,000 worth of exploration expenditures on the Property.
  

Phase Two

Conditional upon completion of phase one, the Company shall be entitled to acquire an additional 24% interest in and to the Property, for a total interest of 75%, by:

• paying an additional C$90,000 in cash to the Vendor on or before the date that is twelve (12) months following the Effective Date;
• issuing, on or before the date that is twenty-four (24) months following the Effective Date, such additional number of Shares to the Vendor having a value equal to C$400,000, calculated on the date of issuance using the market price of the Shares on the CSE on such date, such Shares being subject to voluntary resale restrictions whereby, subject to applicable securities laws and stock exchange rules, 50% of such Shares shall be released to the Vendor immediately upon the date of issuance, and the remaining 50% shall be released four (4) months after the date of issuance; and
• incurring, within twenty-four (24) months following the Effective Date, an additional C$1,000,000 worth of exploration expenditures on the Property.
  

Phase Three

Conditional upon completion of phase one and phase two, the Company shall be entitled to acquire an additional 15% interest in and to the Property, for a total interest of 90%, by:

• paying an additional C$30,000 in cash to the Vendor on or before the date that is thirty-six (36) months following the Effective Date;
• issuing, on or before the date that is thirty-six (36) months following the Effective Date, such additional number of Shares to the Vendor having a value equal to C$100,000, calculated on the date of issuance using the market price of the Shares on the CSE on such date, such Shares being subject to voluntary resale restrictions whereby, subject to applicable securities laws and stock exchange rules, 50% of such Shares shall be released to the Vendor immediately upon the date of issuance, and the remaining 50% shall be released four (4) months after the date of issuance; and
• incurring, within thirty-six (36) months following the Effective Date, an additional C$1,000,000 worth of exploration expenditures on the Property.
  

Upon satisfaction of phase three, the Company will grant the Vendor a 2% net smelter returns royalty (the “NSR Royalty”), with the Company retaining the right to buy back from the Vendor the NSR Royalty for C$2,000,000.

About Pan American Energy Corp.

Pan American Energy Corp. (CSE: PNRG) (OTC PINK: PAANF) is an exploration stage company engaged principally in the acquisition, exploration and development of mineral properties in North and South America.

On Behalf of the Board of Directors
Jason Latkowcer
CEO & Director

Contact
Phone : (585) 885-5970
Email: info@panam-energy.com

Forward-Looking Statements

This news release includes forward-looking statements that are subject to risks and uncertainties, ‎‎including with respect to the Company completing phase 1, phase 2 and phase 3 of the Option Agreement, the Company acquiring any interest in the Property, timing of cash payments, share issuances and expenditure requirements, and development of the Property. The Company ‎‎provides forward-looking statements for the purpose of conveying information about current ‎‎expectations and plans relating to the future and readers are cautioned that such statements may not be ‎‎appropriate for other purposes. By its nature, this information is subject to inherent risks and ‎‎uncertainties that may be general or specific and which give rise to the possibility that expectations, ‎‎forecasts, predictions, projections, or conclusions will not prove to be accurate, that assumptions may not ‎‎be correct, and that objectives, strategic goals and priorities will not be achieved. These risks and ‎‎uncertainties include but are not limited those identified and reported in the Company’s public filings ‎‎under the Company’s SEDAR profile at www.sedar.com. Although the Company has attempted to identify ‎‎important factors that could cause actual actions, events, or results to differ materially from those ‎‎described in forward-looking information, there may be other factors that cause actions, events or ‎‎results not to be as anticipated, estimated or intended. There can be no assurance that such information ‎‎will prove to be accurate as actual results and future events could differ materially from those ‎‎anticipated in such statements. The Company disclaims any intention or obligation to update or revise any ‎‎forward-looking information, whether as a result of new information, future events or otherwise unless ‎‎required by law.‎

The Canadian Securities Exchange has not approved nor disapproved the contents of this news release and does not accept responsibility for the adequacy or accuracy of this release.

FAQ

What is the significance of the Option Agreement signed by Pan American Energy Corp. on August 22, 2022?

The Option Agreement allows Pan American Energy Corp. to acquire a 90% interest in the Big Mack Property, enhancing their lithium asset portfolio.

What are the financial commitments involved in acquiring the Big Mack Property by Pan American Energy?

Pan American will incur C$80,000 in cash, C$200,000 in shares, and C$1 million in exploration expenses in the first phase alone.

When is Pan American Energy expected to complete the three phases of the Option Agreement?

The first phase must be completed within 12 months, second phase within 24 months, and the third phase within 36 months from the effective date.

How does the Big Mack Property enhance Pan American Energy Corp.'s portfolio?

The property adds a hard rock lithium asset to Pan American's portfolio, diversifying its existing lithium projects.

What does the acquisition of the Big Mack Property imply for the company's future?

It positions Pan American Energy Corp. to capitalize on the growing lithium market, potentially increasing shareholder value.