White Mountain Titanium Corp., www.wmtcorp.com – owner of the Cerro Blanco rutile deposit in Region III of Northern Chile, a huge source of premium grade titanium dioxide (TiO2) concentrate for the paint and pigment markets, reported signing a Letter of Intent (L/I) to license the Chinuka Process, a new titanium metal technology.
The Company, along with Sociedad Contractual Minera White Mountain Titanium (SCM-WMT; a WMTM wholly-owned Chilean subsidiary), La Serena Technologies Ltd., and Chinuka Limited plc, have entered into this L/I to license the Chinuka-developed process realized under the direction of University of Cambridge Professor and Director of Research, Materials Science and Metallurgy, Dr. Derek Fray.
The Chinuka Process represents immediate time- and cost-saving benefits over the industry standard Kroll batch process, which uses multiple steps that employ titanium pigment as a feedstock to create titanium sponge metal.
The Chinuka Process uses titanium ores and concentrates for its feedstock, and eliminates all of the difficulty with a single step in which simultaneous refining and electro-deposition occur.
The Company will gain access to the Chinuka Process for use at Cerro Blanco via execution of a non-exclusive, sublicensing agreement with La Serena, through subsidiary SCM-WMT, with La Serena executing the sublicensing agreement as holder of the master license.
Under the terms of the agreement (and as consideration for the sublicense), WMTM will issue 4M restricted common shares to Chinuka (800k) and La Serena (3.2M), issuable over a 24-month period, with 500k shares released to both parties at closing and a balanced released from escrow at the end of each fiscal quarter at a 37.5k-Chinuka, 337.5k-La Serna rate.
• Will be able to cancel the sublicense agreement/share releases at any time after the initial release of shares
• Will spend $5M within five years of closing on developing the Chinuka Process for commercialization
• Will make 2% gross royalty payments to La Serena from revenue generated at Cerro Blanco (attrib. to the Chinuka Process), and make minimum advance royalty payments of $200k per year starting five years after closing
• Will use the Chinuka Process to initiate commercial titanium metal and feedstock production from Cerro Blanco within nine years after closing
President and CEO of WMTM, Michael Kurtanjek, was enthusiastic about being first to secure access to this breakthrough new process, and called it a huge return-generating opportunity for the Company.
Kurtanjek noted the widespread industry demand for an alternative to the Kroll process, rising demand for titanium, and overall vastly more efficient Chinuka Process as contributing to an ideal market position for MWTM.
Extant lab data from Dr. Fray abundantly indicates that commercialization of the technology is viable and imminent. When the technology is up-scaled to a full-sized titanium metals plant, it will make titanium cheaper and more widely useable, and Kurtanjek sees the huge opportunity to impress shareholders and the industry alike because they also happen to be sitting on one of the richest TiO2s in Chile.