On Sept. 29, Declan Resources announced that Opal Energy has acquired the option to earn up to a 75 percent interest in Declan’s Firebag River Property located southwest of the Athabasca Basin in northeast Alberta, Canada.
“The Firebag property is an industrial mineral sand project,” stated Declan president and CEO David Miller in an interview with Financial Press. “This can be a very profitable business. The frac sand lies on the surface, so it’s relatively easy to scoop it up, wash it, screen it and put it into rail cars in one-ton bags. We are very excited about the partnership with Opal and the revenue potential of Firebag.”
The option agreement requires Opal to make exploration expenditures of $850,000 prior to Nov. 22, 2016. Opal is reimbursing Declan’s option payment, exploration expenditures and making a cash payment of $250,000 as well as issuing 4 million shares over a two-year period to Declan. The end result will be that Declan has no further cash obligations on the Firebag property but still retains a significant material interest in it.
The Firebag property consists of six metallic and industrial minerals permits encompassing approximately 50,000 hectares. It is west of Fission Uranium Patterson Lake South (PLS) project, and about 30 km south of the southernmost mapped margin of the basin. It also lies adjacent to the east of the Athabasca Minerals silica sand project.
“The economics of a project like Firebag can be vibrant,” stated Miller. “With a growing demand for API standard silica sand and a large potential resource, a strategic joint venture at this stage makes economic sense for us.”