AIDEA MOU

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The Company has signed a Memorandum of Understanding with the Alaska Industrial Development and Export Authority (“AIDEA”), a public corporation of the State of Alaska whose purpose is to support and encourage the development of Alaska’s natural resources.  AIDEA has the authority to finance, develop, and own and operate facilities used in the extraction, production, and transportation of minerals and materials.  AIDEA is reviewing with the Company:

  • Strategies to maximize local economic benefits and job opportunities
  • Potential opportunities to locate the Manufacturing Plant in Alaska
  • Frameworks for AIDEA and the Company to engage cooperatively with stakeholders to incorporate their input via public meetings and consultations
  • Opportunities to work cooperatively to identify activities requiring federal, state or local permitting
  • Options and opportunities for AIDEA to participate in funding some of the Project facilities including the 22 mile access road and the power generating facility.
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The Property consists of 176 Alaska State mining claims (Figure 2, Blue) covering 9,583 hectares (23,680 acres).

 

Figure 2: Graphite Creek Mining Claims
Figure 2: Graphite Creek Mining Claims

Former Federal Mining Claims

The Company gained control of the 24 Federal claims (shown in red in Figure 2) through a long-term lease agreement with Kougarok, LLC, an Alaska company held by the original stake holders (the “Lease”).

In March 2018 and under the terms of the Lease, Kougarok completed the conversion of its 24 Federal unpatented lode mining claims to State of Alaska mining claims with the Alaska Department of Natural Resources. The Company in turn transferred to Kougarok thirteen of its Alaska state mining claims that overlapped with the lands of 4 of the Federal claims and simultaneously leased them back from Kougarok under the terms of the Lease.  This will relieve the Company of the need to comply with certain federal regulatory requirements since federal lands are no longer involved and is anticipated to simplify the permitting process for the Project.

The Lease has an initial term of twenty years commencing January 2014 with provision to extend through the Project’s life. The remaining payments and production royalties due under the lease are:

The Company has the option to reduce production royalties by up to 2% by paying Kougarok LLC $2,000,000 for each 1% reduction of the royalty.

Purchased Claims (56)

The Company purchased 56 Alaska state mining claims in two transactions, with each transaction acquiring 28 claims covering the same lands and representing the junior and senior state mining claims that overlap and surround the 24 Federal claims.  The first group of 28 claims was purchased in 2012 and carries a 2% production royalty on future production from the covered area. The Company has the right to purchase the production royalty for $1 million at any time on or before January 24, 2021.  The second group of 28 claims was purchased in 2015 and carries a royalty interest equal to 1% on production from the claims.  The Company can purchase the royalty for $500,000 at any time within 36 months following the start of mine production.  Some of the Purchased state claims overlapped with the former Federal claims leased by the Company and conveyed to the State.

Staked Claims (120)

Graphite One (Alaska) Inc. has staked 120 Alaska state mining claims, some for potentially locating infrastructure.

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