Niocorp Developments Ltd (NB)

[The_Gman]

Title and Ownership
https://www.niocorp.com/wp-content/uploads/Securities-Exchange-Act-Reports.pdf

Unclear how much leverage they would actually have since the company has no money and there's no guarantee the project will even ever get started at this point. How many other folks are lining up to option or purchase that land, and how critical are those parcels to the beginning of the project? Do the upcoming expirations have anything to do with today's news? Interesting that all but one expire prior to 6/30/2025 when any outstanding amounts become due. It is free money for the land owner, after all.

Land in the project area is exclusively owned by private entities, and there is no federal or state land in the project area. The Company has secured its rights to the project area by purchasing land from private landowners or by entering into agreements with the landowners as described below. The Company currently owns one 226.43-acre parcel of land (purchased for $6.2 million) and associated mineral rights, and an additional 40 acres of mineral rights, within the carbonatite footprint. The Elk Creek Project’s mine infrastructure and a portion of the supporting operations is planned to be located on this land parcel. Ownership of the mineral rights discussed above includes a 2% NSR royalty and grants us access to more than 90% of the Elk Creek Project’s mineral resources and mineral reserves.

As of June 30, 2022, the total book value of the Elk Creek Property and associated buildings and equipment was $16.9 million.
The Company also holds eight OTPs that are associated with the Elk Creek Project and one perpetual easement of a land parcel along the
Missouri River. The current optioned land package covers an area of 1,396 acres and is reflective of the land needed to secure the remaining mineral resources and mineral reserves held under the OTPs along with the land needed for the development and operations of the Elk Creek Project for its proposed 38-year operating life.

In general, exercise of an OTP is accomplished by paying the greater of a fixed amount per acre or a multiple of the appraised value at the time of purchase. If the land is not purchased by the Company during the term of the OTP and the land in question is needed for the project, the Company will negotiate a new OTP with the landowner. The OTP is accompanied by a negotiated payment to the landowner that is paid upon execution of the OTP by the Company and the landowner. As of June 30, 2022, the Company is obligated to make payments totaling approximately $61 over the next 13 years to maintain our rights under these OTPs. Details on the current OTPs held by the Company are shown in the table below.

Active Lease Agreements (OTP’s) Covering the Elk Creek Project as of September 2022
Agreement Acres Expiry
Beethe007 163.75 20-Jan-26
Heidemann005 196.57 16-Mar-25
Nielsen001 249.32 25-Jun-25
Nielsen002 29.43 25-Jun-25
Woltemath80S 80.00 4-Dec-24
Woltemath002 376.81 4-Dec-24
Woltemath003J 220.00 25-Mar-25
Shuey001 80.00 27-May-40

The OTPs are between NioCorp’s wholly owned subsidiary ECRC and the individual landowners. Land subject to the OTP agreements is currently used for agricultural purposes, including growing row crops (corn and soybeans) and pasturing livestock. The land owned by ECRC houses the company drill core and geological sample repository in two steel core shed buildings and the company maintains a cover crop (sorghum and rye) on portions of the property that were formerly used for growing row crops. The former landowner maintains a residence and several outbuildings on the property subject to a life estate that accompanied the purchase of the property by the Company in fiscal year 2021.

The agreements that involve mineral rights include a 2% NSR royalty attached with the OTP. The OTPs grant the Company an exclusive right to explore and evaluate the property for the term thereof, with an option to purchase the surface rights or a combination of the mineral and surface rights at any time during the term. As the Woltemath80S agreement is limited to an option to purchase the surface rights only, it does not contain an NSR provision.

Note: There may be an updated FORM 10-K/A that I'm not aware of regarding this so if someone has it, please feel free to update.