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Global Energy Metals set for C$1mln raise to advance "important" cobalt project

"This funding will allow GEMC to quickly add significant value to this important cobalt project in a key mining district," said Mitchell Smith

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Millennium Cobalt project is in Mt. Isa, Australia

Global Energy Metals Corp (CVE:GEMC) is set to bring in up to C$1mln via a placing to rapidly advance the Millennium cobalt project in Australia, it told investors.

Last month, the company struck what it called a "transformational" growth opportunity with the acquisition of an option from Hammer Metals for the site  in Queensland, Australia.

"This funding will allow GEMC to quickly add significant value to this important cobalt project in a key mining district," said the group's president and chief executive Mitchell Smith on Wednesday.

"We look forward to working with Hammer Metals and its technical team to continue to advance the Millennium Cobalt project. We anticipate an aggressive exploration program commencing immediately following the closing of this offering."

Proceeds will be used to expand the resource and for exploration drilling and for working capital, it said.

The program is expected to begin during the first week of November.

It will entail reverse circulation (RC) drilling to upgrade  the resource and test depth and lateral extensions.

At the completion of this initial program, with a required $500,000 spend, GEMC will earn a 25% interest in the project.

Global Energy Metals has the right to earn up to 75% in the Mi llennium project with a total $2.5mln  spend on project expenditures.

"This initial program will be part of a larger aggressive work initiative that will include a targeted drill campaign, further exploration of deeper mineralization and expansion throughout the entire project," said Smith.

The property covers five separate mining leases with an existing JORC compliant mineral resource defined by drilling from a 2016 programme.

That showed an inferred resource of 3.1 million tonnes at 0.14% Cobalt, 0.34% copper and 0.12g/t (grams per ton) gold, using a copper equivalent cutoff of 1%.

The site is near infrastructure and preliminary hydrometallurgical studies have shown potential to recover saleable cobalt and copper concentrates.

The placing will see units issued at 12 cents each, with each unit comprising one share and one  share purchase warrant, which will be exercisable into one company share at 20 cents each for 12 months.

The warrants will contain an acceleration provision, the group added.

--UPDATES WITH MORE DETAIL--

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