Under the terms of the agreement, Apella will receive $1.5 million from Power Vanadium, by way of a secured promissory note, and 81.67 million non-restricted common shares of Power Vanadium.
The company will also receive 35 percent of all funds received as a result of the Province of Quebec mining/exploration incentive and tax refund programs, plus a three percent net smelter royalty (NYSE:NSR).
Apella will act as operator of the Iron-T project, and will receive a management fee totaling 15 percent of Power Vanadium's total expenditures in each fiscal year. Additionally, Power Vanadium will deliver a bankable feasibility study for the project by the end of July 2014.
The latest resource estimate for the project, completed in May 2011, included results from the company's 2009-2010 exploration activities, and was based on 41 drill holes, including two revised historical drill holes, for a total length of 5,519 metres at Iron-T.
Using a minimum cut-off grade of 0.48 percent vanadium equivalent, inferred resources are now estimated at 14.38 million tonnes, at 0.42 percent vanadium equivalent.
The company said this represents a 24 percent increase from the classified inferred resource of 11.6 million tonnes in the previous report last August.
Monday's transaction is the second move within Apella's 2012 "go-forward plan" and the company expects to undertake similar agreements for its other vanadium-iron-titanium projects in the near-term.
Last month, Apella sold its Lac Dore vanadium-iron-titanium project to its 100 percent-owned Prestige Mining unit.
Under the terms of that sales agreement, Prestige Mining will pay Apella $1.5 million in a promissory note secured by 81.7 million non-restricted common shares in Prestige Mining.
Earlier this year, Apella decided on a strategy of placing three of its vanadium-iron-titanium assets - the Lac Dore/Lac Dore North project, the Iron-T project and the Game Changer project - into wholly-owned subsidiaries dedicated primarily to that particular asset.
As funds are raised to develop the projects, since they are held within subsidiaries, share dilution to the company as a whole is avoided.
The company believes that its current and future potential will be fully maximized from its initiatives targeted toward moving its extensive Canadian vanadium-iron-titanium projects into production.
Vanadium is an essential element in high-quality steel and also has applications in energy storage and green technology.
Vancouver-headquartered Apella Resources is focused on securing a stable Canadian supply of vanadium through its numerous exploration projects in the province of Quebec. The junior explorer also has gold and copper assets in its portfolio.