en.Wedoany.com Reported - Abitibi Metals Corp. (CSE: AMQ, OTCQB: AMQFF, FSE: FW0) has reached an agreement with SOQUEM, a subsidiary of Investissement Québec, to acquire the remaining 20% interest in the B26 polymetallic deposit for an initial consideration of approximately C$7 million. Upon completion of this transaction, Abitibi will hold 100% ownership of the deposit. Previously, Abitibi held an 80% interest in B26 under an option agreement initiated in 2023, with SOQUEM retaining the remaining interest through a joint venture and royalty arrangement. The transaction will terminate the original joint venture and replace the previous royalty with a restructured net smelter return arrangement.

B26 is a polymetallic volcanogenic massive sulfide (VMS) deposit in Quebec, with total resources of 25.3 million tonnes, including 12.96 million tonnes of indicated resources grading 2.08% copper equivalent (1.19% copper, 1.16% zinc, 0.44 g/t gold, 30.8 g/t silver) and 12.34 million tonnes of inferred resources grading 2.20% copper equivalent (1.60% copper, 0.16% zinc, 0.68 g/t gold, 8.1 g/t silver). The deposit is the target of Abitibi's largest-ever drilling program (over 80,000 meters), currently underway, which includes ongoing Phase 4 expansion and discovery work, with metallurgical and geotechnical testing also in progress. Abitibi Metals President and CEO Jonathon Deluce stated that the program aims to achieve two goals simultaneously, both targeted for completion in Q1 2027: a preliminary economic assessment (PEA) focused on near-surface economics and early deposit returns, and an updated resource estimate aimed at determining the total deposit size and mine life.

The initial consideration is C$7 million, consisting of C$5 million in cash and C$2 million in Abitibi Metals shares. The cash portion is payable within 90 days of closing and may be reduced by 20% of exploration expenditures incurred by Abitibi during this period attributable to SOQUEM's interest. SOQUEM retains a 1% net smelter return (NSR) royalty on B26, replacing the terminated joint venture royalty. The agreement also includes two deferred milestone payments of C$6 million each, payable 50% in cash and 50% in shares. The first is triggered at the feasibility study stage, or no later than three years after closing; the second is triggered at the construction decision stage, or no later than five years after closing. The agreement also includes clawback provisions: if the first milestone is not met, SOQUEM will receive an additional 1% NSR (total NSR of 2%) and a 12% interest in the B26 project; if the second milestone is not met, an additional 0.5% NSR (cumulative total of 1.5%) and a 6% project interest will be granted. Abitibi retains the right to repurchase any additional NSR activated under either clause for C$2 million.

Abitibi completed a C$31 million financing without issuing warrants, providing funding for the company through the Q1 2027 PEA milestone. In terms of shareholder structure, Discovery Silver holds a 9.9% strategic stake, institutional investors account for 40%, management and SEDI holders hold 13%, high-net-worth and strategic investors hold 13%, the Deluce family office holds 7%, and SOQUEM holds 5%. Deluce stated that ample funding will be used to execute over 80,000 meters of drilling, deliver the PEA, significantly advance the feasibility study, and support additional acquisitions to demonstrate a large-scale district-wide approach encompassing B26 and surrounding areas.

In terms of industry valuation comparisons, Abitibi's current enterprise value represents 0.8% of its in-situ resource value. For comparison, Foran Mining's McIlvenna Bay deposit (a similar Canadian VMS deposit) was acquired by Eldorado Gold for approximately C$3.8 billion, representing 20.4% of its in-situ value at the time of acquisition; the same metric for advanced-stage VMS developer FireFly Metals is 3.5%. Deluce noted that the rarity of such deposits in the market has been demonstrated, for example, by Eldorado's acquisition of Foran, with deposits of B26 and McIlvenna Bay's scale becoming increasingly rare in Canada.

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