Canadian gold developers Osisko Development (TSXV: ODV; NYSE: ODV) and O3 Mining (TSXV: OIII, US-OTC: OIIIF) have linked up to create a premier lithium exploration company focused on the James Bay region of Quebec.
Both companies are part of the Osisko Group, started by the team that found Canada’s largest open pit gold mine, Canadian Malartic in Quebec, now owned by Agnico Eagle Mines (TSX: AEM; NYSE: AEM).
The new company — named Electric Elements Mining Corp. — will hold all of Osisko’s interests in its James Bay properties plus O3’s rights to the Éléonore Opinaca property. After its formation, Osisko and O3 respectively owned 80% and 20% of Electric Elements’ shares.
The James Bay properties cover prospective grounds totalling 186,000 sq. km near Newmont’s (TSX: NGT; NYSE: NEM) Éléonore mine. Osisko acquired the properties in 2015 through its takeover of Virginia Mines. To date, over $50 million have been invested with several drill-ready targets identified.
The Éléonore Opinaca project is located about 320 km north of the town of Matagami, comprising 4,131 sq. km in two separated blocks. The property is also accessible by road to the Éléonore gold mine.
By spinning out these assets to Electric Elements, both Osisko and O3 say they can continue to focus on their respective primary gold projects.
Subsequent to the spinout, Electric Elements completed an equity financing of 50¢ per share to raise gross proceeds of just over $4.1 million, which will be used to fund exploration activities on the newly acquired properties.
After giving effect to the financing, Osisko and O3’s shareholding would be diluted down to roughly 47% and 12%, respectively, with the remaining 41% to be held by new subscribers.
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