Orca buys Ucore's REE plant

Ucore Rare Metals Inc. July 31 announced that it has entered into an agreement to sell SuperLig-One to Orca Holdings LLC and then lease back the rare earth separation pilot plant from Orca, a Ketchikan, Alaska-based enterprise controlled by Ucore advisory board member Randy Johnson.

Under the terms of the agreement, Orca will pay Ucore of US$2 million for SuperLig-One and then lease the plant back to Ucore over a 3-year term at an annual lease rate of 15 percent.

At the option of either party, the lease may be terminated upon the payout by Ucore of the purchase price at any time after the first year of the term.

Ucore will set aside US$1 million to pay IBC Advanced Technologies, which designed SuperLig-One, for the balance outstanding under a joint venture agreement to pursue rare earth separation, tailings processing and catalytic converter recycling applications.

"This is a non-dilutive financing arrangement which leverages a significant asset for go-forward development", said Ucore President and CEO Jim McKenzie. "The pilot plant has an innovative modular design which can be modified for multiple purposes, whether at its existing location in Utah, or as the expandable framework for rare earth output in Alaska or elsewhere. We look forward to working with Orca to optimize and generate maximum value from this remarkable development platform."

Prior to the agreement, Orca owned 34.5 million Ucore shares, or about 12.8 percent of the company.

-SHANE LASLEY