Silver Elephant Mining (TSX:ELEF)and Battery Metals Royalties have announced that they have entered into a binding letter of intent pursuant to which Battery proposes to acquire a 45% equity interest of Silver Elephant’s wholly owned Mega Thermal Coal Corp. (formerly Asia Mining Inc.), which owns and operates the Ulaan Ovoo and Chandgana thermal coal mines in Mongolia through Mega Coal’s wholly-owned Mongolian subsidiaries for $6.3 million.
The proposed transaction, the company said, is a step to transform Silver Elephant to a pure silver mining and exploration company by monetizing non-core assets.
Under the terms of the deal, Mega Coal and Battery will revise the terms of a net smelter royalty agreement dated August 25, 2021, as amended, between Mega Coal and Battery from $2 per tonne of coal to 3% of gross coal sales with a minimum royalty of $3 per tonne of coal.
U.S. coal prices topped $100 a tonne for the first time in 13 years on Monday as Russia’s war in Ukraine upends international energy markets and an economic rebound from the pandemic drives up demand for fossil fuels.
