May 11, 20222 min
Western Sierra Resource Corporation (WSRC), a US based natural resource explorer, has laid out a plan to raise ~US$25 million to boost helium exploration on its assets in Colorado along with other purposes such as debt retirement and cultivation of industrial hemp. It has 12 helium prospects and plans to drill one a month over the following year. WSRC announced mid-2021 that it had entered into negotiations with a third-party exploration company to develop the 25,000-acre FCHPA Helium Production Project in the Four Corners Area.
Press Release:
Since December 2021, WSRC has been negotiating a deal structure with, and satisfying due diligence requirements for, a private capital source prepared to fund the Company’s operations through monetization of WSRC’s land, water, and mining assets. This agreement is scheduled for final review by May 16, 2022, and contemplates up to $25 million in proceeds to retire existing debt and provide operating capital sufficient to fully fund the Company’s various projects over the next 12 months, without dilution for its shareholders. Specific terms of the transaction will be announced upon completion of legal review.
In general, an initial round of capital is expected within the next 45 to 60 days in the amount of $10 million in exchange for a participation in future revenue generated by expansion and acceleration of the Company’s current natural resource-related endeavors and utilizing the Company’s $60+ million in appraised and audited assets.
Consistent with the terms of the agreement, WSRC intends to:
Incrementally utilize its land and water assets for cultivation of industrial hemp; manufacture of hemp-based construction materials; and to initiate development and subsequent construction of “green” affordable housing to help meet extraordinary pent-up demand.
Initiate the modest but immediate processing and recovery of precious metals from tested above-ground material, and to subsequently scale into larger, ongoing mining operations at the Sage Hen location. Assay reports anticipate a potential recovery rate averaging $30,000 per ton using proprietary, environmentally friendly processing technologies.
Fund the first of 12 helium production prospects, each governed by its own 3D seismic data set and under varying terms and agreement conditions. It is reasonable to assume that based on current supporting data, an average of one new prospect may be brought online over each of the twelve months following funding.
Capitalize on multiple (but related) revenue generating and asset expanding opportunities that are expected to result from the above-mentioned core projects as they mature, and as operational efficiencies are achieved. The scale of funding anticipates such expansion.