NEWS-Star Minerals Group Signs Multi-Party Memorandum of Understanding to Develop Manganese Mine with a Mine to Market Strategy
Press Release: Star Minerals Group Ltd. –
SASKATOON, SASKATCHEWAN--(Marketwired - Dec 4, 2014) - Star Minerals Group Ltd. (CSE:SUV) ("Star") announces the signing of a Memorandum of Understanding (MOU) with Cooperative Mineral Resources LLC ("CMR") of Brainerd, Minnesota and Octopus Technologies Inc. ("OTI") of Vancouver, BC, to cooperate on developing a mine-to-market manganese-based battery technology.
Star is a Saskatoon, SK-based junior mining company, focused on finding, exploring and developing strategic metal deposits for the battery industry, as well as other critical materials products for downstream applications in the green energy sector.
CMR is owned 100% by Crow Wing Power ("CWP") with operations based in Brainerd, Minnesota. CWP is a member-owned electric utility, with the cooperative distributing electricity to 37,000 customers in Cass, Crow Wing and Morrison counties in rural Minnesota. In 2009, CWP, through CMR, began work to advance the development of the Emily Manganese/Iron Ore Project located near Emily, Minnesota on the Cuyuna Iron Range. The ultimate goal of the project is to develop a natural resource for the benefit of the local economy, the members of CWP and the State of Minnesota and to supply electrolytic manganese metal ("EMM") to the steel industry and electrolytic manganese dioxide ("EMD") to the battery industry. CMR has undertaken extensive work including exploration core drilling, bulk sampling at Emily and mineralogical and metallurgical testing at recognized analytical laboratories, and has been successful in producing EMM and EMD from samples taken at Emily. In May 2013, Barr Engineering Co. ("Barr") of Minneapolis, Minnesota, completed a report entitled "Mineral Resource Report on the Emily Manganese Project Minnesota". The report compiled available historic data and modern data from the CMR work to produce an historic estimate of manganese mineralization at the Emily deposit. Based on the report, the deposit ranges from 1.4 billion pounds of contained manganese grading at 16.48% Mn at a cut-off grade of 10% Mn, to 2.2 billion pounds of contained manganese grading at 9.2% Mn at a cut-off grade of 1% Mn.
The following additional information required when reporting historic estimates is provided below:
•The 2013 historic estimate by Barr incorporates drilling results from three separate drilling programs; the first from October 1945 to June 1950, the second in September and October 2011, and the third in October and November 2012 for a total of 20 drill holes totaling 8,861 feet.
•The historic estimate relies on earlier reports, namely Pahlman 1996, Marston 2008, and Barr 2012.
•The historic estimate relied on Barr checking, validating and updating the Emily assay and geological database.
•The historic estimate relied upon a comprehensive Quality Assurance/Quality Control program involving the use of blanks, standards and field duplicates that was instigated by Barr.
•Barr did not assign categories to the historic estimate and a comparison to NI43-101 categories is not possible.
•Additional in-fill and exploratory drilling may be required to upgrade the status of the Barr historic estimate to that of a current mineral resource or mineral reserve.
•The Company is not treating the Barr historic estimate as current mineral resources or mineral reserves.
The Company cautions that a qualified person (within the meaning of NI 43-101) has not done sufficient work to classify the historic estimate as current mineral resources or mineral reserves and should not be relied upon until they have been verified and supported by a compliant NI 43-101 technical report.
OTI is an energy storage company which has developed a smaller, lighter, green battery that significantly reduces the cost of energy storage and is ideally suited for backup/standby power applications and smart grid management systems. OTI is in a strategic partnership with Kemetco Research Inc. ("Kemetco") in building the prototype battery for testing and certification. Kemetco also specializes in extractive metallurgy and chemical processing and has done extensive work for CMR on manganese metallurgy.
Star and CMR intend to enter into an agreement forming a joint venture ("JV") to develop the Emily Manganese/Iron Ore Project. Should the technical and economic viability of the Emily Manganese/Iron Ore Project be established, it is the Company's intent to fully develop the project. The initial focus will be to produce EMD to be sold to OTI in an off take agreement between OTI and the CMR/Star JV under terms to be established. OTI has in turn completed and signed a sales distribution agreement, for their storage battery, with a significant global player in this market.
CMR and Star intend to complete and sign the JV agreement by the end of February 2015. OTI and the JV will also have signed the offtake agreement by the same date. OTI will have provided details of the sales agreement between themselves and the significant distributor by the end of February 2015.
Other conditions precedent to the final agreement will be due diligence by all parties, final terms between Kemetco and OTI on completing the test facility for their battery plant and final terms between Kemetco and the JV to build the test facility to produce EMD.
While the components of this mine-to-market business model are in their early stages, from mine development to the testing, certification and production of batteries, all the parties are in place to execute in a very timely manner.
Jim Engdahl, President and CEO of Star says "I am extremely excited about this project and pleased to be working with the high caliber of people from CMR and OTI in developing what has the potential to be an important type of storage battery for specific applications."
Bruce Kraemer, CEO of CMR, says, "We are looking forward to working with Star and OTI as the revolution of the green battery industry evolves and the demand for manganese as a critical component increases. Currently there is no production of electrolytic manganese in North America ?öÇ a key factor for this continent to remain globally competitive in the green energy field."
Bob Wallace, CEO of OTI says, "The synergies of collaborating with Star and CMR to bring the Emily project into commercial production are obvious and very beneficial to all participants. OTI will secure a stable, long-term supply of EMD for its batteries while Star/CMR have a major purchaser for their production."
About Star Minerals Group Ltd.
Star is a Saskatoon-based, diversified exploration stage company, with a primary focus on strategic technology metals, and its advanced joint venture rare earth project Hoidas Lake. To advance exploration, the Company has leveraged the strength and experience of its management, board of directors and advisors to identify and acquire strategic investments that have the capability to generate cash flow with low capital expenditure costs.
The Company entered into a joint venture in an advanced rare earth project in Saskatchewan - Hoidas Lake. Star also holds a strategic gold exploration property in the Seabee gold mining district, diamond properties in the Fort a la Corne region as well as base metal and uranium properties.
Gary L. Billingsley, P.Eng., P.Geo., an independent director of the Company and a qualified person within the meaning of National Instrument 43-101, has reviewed and approved the technical content of this news release.
STAR TRADES ON THE CSE UNDER THE SYMBOL "SUV".
For more information, please visit our website at www.starminerals.ca.
Forward Looking Statements
This news release contains certain statements which constitute forward-looking statements or information ("forward-looking statements. Such forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Star's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, competition from other industry participants, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Star believes that the expectations in its forward-looking statements are reasonable, they are based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. Other factors that could materially affect such forward-looking statements are described in the risk factors in the most recent management's discussion and analysis that is available on the Company's profile on SEDAR at www.sedar.com. Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Star does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. This cautionary statement expressly qualifies the forward-looking statements contained in this document.
.Star Minerals Group Ltd.