Athabasca Minerals Acquires Privco2

Athabasca Minerals Inc. entered into an agreement to acquire ownership of private corporation Privco2 that holds the Duvernay Frac Sand Project in Alberta, Canada. The Duvernay Project adds to and further strengthens the corporation’s objective of becoming the leading in-basin frac sand supplier of premium domestic sand in Western Canada through its wholly owned subsidiary, AMI Silica Inc.

AMI has progressively staged its ownership in Privco2, based on key milestones in delineating the Duvernay Project resource. An initial investment of $280,000 in cash and the issuance of 420,000 Athabasca shares was made for 16.2 percent interest in Privco2. An additional 33.4 percent interest will be acquired for $742,000 and the issuance of 1,680,000 Athabasca shares pending resource delineation results expected in April 2019. The corporation has the further option to purchase the remaining 50.4 percent from Privco2 shareholders within one year following this transaction.

Robert Beekhuizen, CEO of Athabasca Minerals, and president of AMI Silica Inc. stated, “With the acquisition of Privco2, AMI Silica Inc. has expanded and strategically positioned its portfolio with a book-end project serving the Duvernay and Deep Basins in Alberta that complements its Montney In-basin project.

The quality of the Duvernay Project frac sand benchmarks well against imported Tier-1 Wisconsin/Northern White sands. Considering that 30 percent of the frac sand used in the Western Canadian Oil & Gas sector is deployed in Duvernay and Deep Basins, and 55 percent in the Montney Basin, AMI Silica’s assets cater to 85 percent of market demand with premium domestic in-basin resources. Additionally, the Corporation’s Duvernay and Montney Projects offer important supply and logistics alternatives to local industry that simplify product delivery, double-handling risks, reduce transportation costs and a continued dependence on 70 percent imported American frac sand.”

Early laboratory results of the Duvernay Project sand, as conducted by Stim-Lab Inc. on samples taken from the deposit, showed favorable physical properties, with sphericity and roundness factors of 0.7 each, acid solubility of 2.6 percent and crush strength values of 9k psi (40/70 granularity) and test results of 10k psi (70/140 granularity). These preliminary results indicate that the Duvernay Project sand complies with API Standard 19C specifications for sands used in hydraulic fracturing.

Athabasca and Privco2 have formed a joint project team, with initial exploration activities to commence immediately. Funds invested in Privco2 will be used to advance the Duvernay Project commencing with resource delineation and validation in Q1 2019.

Related posts