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World Copper Enters into Letter Agreement for the Acquisition of the Zonia Copper Oxide Project

FOR IMMEDIATE RELEASE…Vancouver, British Columbia: World Copper Ltd. (“World Copper” or the “Company“; TSXV: WCU) is pleased to announce that it has entered into a letter agreement dated April 13, 2021 (the “Letter Agreement“) with Cardero Resource Corp. (“Cardero“; TSXV: CDU), whereby the Company has agreed to acquire 100% of Cardero’s Zonia copper oxide project located in central Arizona (“Zonia“) by way of business combination between the Company and Cardero (the “Proposed Transaction“).

Under the terms of the Proposed Transaction and subject to acceptance by the TSX Venture Exchange (the “TSXV“), the Company would acquire all of the outstanding common shares of Cardero in consideration of the issuance of common shares of the Company (the “WCU Shares“) to the shareholders of Cardero, such that upon the completion of the Proposed Transaction the number of WCU Shares held by former shareholders of Cardero, on a non-diluted basis, will be 40% of the then issued and outstanding WCU Shares with the remaining 60% held by the existing shareholders of World Copper (the “Exchange Ratio“). The Proposed Transaction involves a Non-Arm’s Length Party (as defined in TSXV Policies) insofar as Hendrik van Alphen, the CEO and a director of the Company, is also a director of Cardero.

World Copper CEO, Hendrik van Alphen, stated, “We are building a major player in the copper industry, and the acquisition of Zonia is a large step on that path. World Copper has a fantastic stable of assets in Escalones and Cristal, but to make our pipeline more complete, we have targeted Zonia, a late-stage development project that gives the Company a potentially shorter time-line to production. Copper prices have been buoyant and the global drive to electrification is set to make copper demand and prices robust for a long time. Therefore, the sooner we can generate cash flow in this dynamic, the better served shareholders will be. Our intent is to push forward with permitting, engineering and planning in the mining-friendly jurisdiction of Arizona, USA to get Zonia up and running soon. We expect this will help to shift development financing of our Chilean assets from external to internal sources of capital, thereby mitigating future shareholder dilution and building long-term value. The team at World Copper is very excited about this acquisition and I look forward to providing future updates.”

About Zonia

Zonia is located in the Walnut Grove Mining District, Yavapai County, Arizona, and consists of 261 patented (96) and unpatented (185) mineral claims, and 566.85 acres of surface rights acquired from the State of Arizona, all totaling 4,279.55 acres.

Zonia is a near-surface, copper-oxide resource and a brownfields site having already been mined in the late 1960s and ’70s. The project has been significantly de-risked with over 50,000 metres of drilling completed to date and with substantial amounts of detailed engineering completed. Zonia contains Measured resources of 15.6 million short tons grading 0.43% copper (129.3 million pounds of copper), Indicated resources of 61.4 million short tons grading 0.31% copper (380.6 million pounds of copper) and Inferred Resources of 27.2 million short tons grading 0.28% copper (154.6 million pounds of copper) at a 0.2% total copper cut-off grade. A preliminary economic assessment dated April 17, 2018, effective date March 22, 2018 (the “PEA“) was prepared by Global Resource Engineering Ltd., which suggests that the project can be advanced utilizing low-cost open pit mining and heap leach with SX-EW processing to produce pure copper cathode (a copy of the PEA technical report is available on Cardero’s SEDAR profile at www.sedar.com).

Zonia was pre-stripped during mining in the late 1960s and 1970s so that, as described in the PEA, the strip ratio is a low 1:1. Furthermore, GRE outlines a mine plan and development strategy entirely on private land, which significantly reduces the timeline for permitting. At a copper price of $3.00/lb, Zonia shows an after-tax NPV@6% of $225 million, and an IRR of 29.0%.

The PEA is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and, as such, there is no certainty that the PEA results will be realized. Mineral resources are not mineral reserves and do not have demonstrated economic viability as there is no certainty that all or any part of the resources will be converted into reserves.

In addition to the established resource, the Zonia land position contains a copper-molybdenum geochemical anomaly (associated with depressed manganese values) that is similar in intensity and scale (1000 by 1500 metres) to the main resource, and within the same prospective geology. This anomaly is located two kilometers northeast of the resource and represents a high-priority copper-oxide porphyry exploration drill target.

Summary of the Transaction

It is currently anticipated that the Proposed Transaction will be completed by way of a plan of arrangement, however, the structure of the Proposed Transaction remains subject to negotiations between the parties and may be altered for tax, corporate, securities or regulatory reasons. The parties have agreed to negotiate in good faith a formal definitive agreement (the “Definitive Agreement“) which will contain representations, warranties and conditions of each party customary in transactions of this nature.

Under the terms of the Letter Agreement, the parties have agreed to the following principal terms for the Proposed Transaction:

  • all outstanding warrants of Cardero not exercised by the holders thereof prior to the closing of the Proposed Transaction will be exercisable into WCU Shares in accordance with and subject to adjustment (as to number and exercise price) using the Exchange Ratio, the Consolidation (as defined below) and the rules of the TSXV;
  • Cardero will have the right to appoint two members to the board of directors of the resulting entity;
  • World Copper will assume certain debts of Cardero consisting of (i) approximately $2,329,163 in loans owed to a controlling shareholder of Cardero and/or entities related to it (collectively, the “Creditor Entities“), including interest accruing at 12% per annum; and (ii) approximately $1,019,836 in outstanding dividends on preferred shares in the capital of Cardero, formerly held by the Creditor Entities; and
  • concurrently with the closing of the Proposed Transaction (or prior to the first anniversary thereof), World Copper will conduct a financing or financings, the aggregate gross proceeds of which, when combined with the gross proceeds from the exercise of certain warrants to be issued to the Creditor Entities in connection with the Proposed Transaction, shall be at least $10,000,000 (the “Private Placement“), on the terms and at such price as World Copper may determine. The net proceeds from the Private Placement are expected to be used in connection with drilling programs on the Company’s Escalones and Cristal projects, the details of which will follow in a subsequent news release, and for general working capital purposes.

Completion of the Proposed Transaction will be subject to the satisfaction of various conditions precedent, including: (i) the receipt of all necessary regulatory approvals, authorizations and consents, including acceptance for filing of the Proposed Transaction by the TSXV; (ii) receipt of all necessary corporate and shareholder approvals by the parties; and (iii) there being no material adverse change in the business or operations of any of the parties from the execution of the Letter Agreement by the parties until the closing of the Proposed Transaction.

Subject to applicable regulatory and TSXV acceptance, the Company may pay finder’s fees to certain finders in an amount to be agreed to by the parties.

A subsequent news release will be disseminated when additional details regarding the Proposed Transaction are available.


In connection with the Proposed Transaction, the Company also announces that it intends to consolidate its issued and outstanding WCU Shares (the “Consolidation“) in an amount of one (1) post-Consolidation WCU Share for every three (3) pre-Consolidation WCU Shares. Further details about the Consolidation, including the anticipated trading date for the post-Consolidation WCU Shares and new CUSIP and ISIN numbers, will be announced in a subsequent news release.

The Company believes that the Consolidation will provide the Company with greater flexibility for the continued development of its business and the growth of the Company, including possible financing arrangements.

Additional Information

Additional information about the Company or Cardero is available under their respective SEDAR profile available at www.sedar.com.

Qualified Person

John Drobe, P.Geo., a qualified person as defined by NI 43-101, has reviewed the scientific and technical information that forms the basis for this news release and has approved the disclosure herein. Mr. Drobe is not independent of the Company as he is a consultant of World Copper.


World Copper Ltd., headquartered in Vancouver, BC, is a Canadian resource company focused the exploration and development of its two primary copper porphyry projects, Escalones and Cristal, both located in Chile. World Copper has laid claim to five copper porphyry targets, one with estimated resources, significant soluble copper mineralization, and exciting potential to expand the resource base.

Escalones has estimated resources of 185 million tonnes of 0.33% copper (0.37% CuEq) Indicated and 254 million tonnes of 0.39% copper (0.43% CuEq) Inferred, based on nearly 25,000m of drill core from 53 holes. In addition, three significant hydrothermal alteration zones, each measuring between 2,000m and 3,000m in diameter, lie 8-10km to the north of the main discovery.

Mineral resources are not mineral reserves and do not have demonstrated economic viability as there is no certainty that all or any part of the resources will be converted into reserves. Inferred resources are that part of a mineral resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. It is reasonably expected that the inferred resources could be upgraded to indicated resources with continued exploration.

The World Copper team has a unique skill in navigating the mining sector within Chile, with some members having worked in the country for more than 40 years and with discovery success.

On Behalf of the Board of Directors of


“Hendrik van Alphen”

Hendrik van Alphen
Chief Executive Officer

For further information, or to schedule a Zoom meeting with Management, please contact:

Henk van Alphen or Michael Pound
Phone: 604-638-3665
E-mail: [email protected]

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Neither TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Note Regarding Forward-Looking Statements

This news release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable Canadian and U.S. securities legislation, including the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included herein including, without limitation, the Company’s expectation that it and Cardero will be able to complete the Proposed Transaction, including entering into a Definitive Agreement, the closing and amount of the Private Placement, that Zonia can be advanced utilizing low-cost open pit mining and heap leach, the results of the PEA, including, without limitation the NPV6%, IRR, estimated costs, average rate of production, the anticipated exploration program results from exploration activities and the anticipated business plans and timing of future activities of the Company, including the timing for the closing of the Proposed Transaction and the expected drilling programs at Escalones and Cristal, are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: “believes”, “expects”, “anticipates”, “intends”, “estimates”, “plans”, “may”, “should”, “would”, “will”, “potential”, “scheduled” or variations of such words and phrases and similar expressions, which, by their nature, refer to future events or results that may, could, would, might or will occur or be taken or achieved. In making the forward-looking statements in this news release, the Company has applied several material assumptions, including without limitation, that it will be able to negotiate and enter into a Definitive Agreement, and that it will obtain TSXV acceptance and the required corporate approvals of the Proposed Transaction and the Consolidation, that there will be investor interest in the Private Placement, market fundamentals will result in sustained copper and precious metals demand and prices, the receipt of any necessary permits, licenses and regulatory approvals in connection with the future development of the Company’s projects in a timely manner, the availability of financing on suitable terms for the development, construction and continued operation of such projects and the ability to comply with environmental, health and safety laws.

Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking information. Such risks and other factors include, among others, requirements for additional capital, actual results of exploration activities, including on Escalones and Cristal, the reasonability of the economic assumptions at the basis of the results of the PEA for Zonia, the estimation or realization of mineral reserves and mineral resources, future prices of copper, changes in general economic conditions, changes in the financial markets and in the demand and market price for commodities, lack of investor interest in the Private Placement, accidents, labour disputes and other risks of the mining industry, delays in obtaining governmental approvals (including acceptance of the Proposed Transaction, the Private Placement and the Consolidation by the TSXV), permits or financing or in the completion of development or construction activities, risks relating to epidemics or pandemics such as COVID‑19, including the impact of COVID‑19 on the Company’s business, financial condition and results of operations, changes in laws, regulations and policies affecting mining operations, title disputes, the timing and possible outcome of any pending litigation, environmental issues and liabilities, as well as the risk factors described in the Company’s annual and quarterly management’s discussion and analysis and in other filings made by the Company with Canadian securities regulatory authorities under the Company’s profile at www.sedar.com.

Readers are cautioned not to place undue reliance on forward-looking statements. The Company undertakes no obligation to update any of the forward-looking statements in this news release or incorporated by reference herein, except as otherwise required by law.


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