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Cadence Minerals #KDNC – Vox Markets Investor Presentation and Q&A

Cadence Minerals #KDNC CEO, Kiran Morzaria offers an overview and update of the Company’s investments and ongoing strategy.  Kiran then answers questions from the Vox Community where he discusses the Amapa Iron Ore Project, future milestones of European Metals Holding and the Company plans for the coming year.

Cadence Minerals #KDNC – Alan Green interviews CEO Kiran Morzaria, plus shareholder Q&A

Alan Green talks to Cadence Minerals #KDNC CEO Kiran Morzaria. Kiran talks about the company’s investments into the Czech Cinovec Lithium project via European Metals #EMH, Macarthur Minerals iron ore projects in Australia, plus Lithium JV’s with Bacanora in Mexico and Hastings Tech Metals at Yangibana, Australia. Kiran then elaborates on the company’s flagship Amapa Iron ore project in Brazil, discusses the latest developments re shipping the ore stockpile, the fundraise for the scoping study plus the value inflection points going forward. Alan and Kiran then go through a shareholder Q&A, before Kiran finally provides key takeaway points for. investors, highlighting the valuations on each of the projects.

Cadence Minerals #KDNC – Bacanora Lithium #BCN – Sonora Lithium Project, Lithium Market & Covid-19 Update.

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) notes the update published today by Bacanora Lithium (AIM:BCN) (“Bacanora”), both on the Lithium market, and on its activities at the Sonora Lithium Project in Mexico (‘Sonora’ or the ‘Project’) in light of the ongoing Covid-19 pandemic.

Cadence Minerals – Holdings in Mexalit and Megalit:

Bacanora is a lithium exploration and development company. Cadence holds 30% of Mexalit and Megalit joint venture companies. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which form part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Lithium Market and Project Development

Whilst demand for internal combustion vehicles has been significantly impacted by the spread of Covid-19 and a general economic slowdown, electric vehicle (“EV”) demand in Europe increased over 50% during first quarter 2020*. In addition, automotive companies have recently outlined plans to spend more than US$140** billion on EV production. This is an industry shift that will require producers of specialist materials and metals for lithium batteries to dramatically lift output. As a result, lithium demand is anticipated to grow 800% by 2030. Bacanora continues to prioritise its development schedule for Sonora despite Covid-19 limitations, with a goal of being able to complete financing for the Project and initiate site works in H1 2021.  This timetable will enable Bacanora to commence lithium deliveries to its offtake partners, Ganfeng Lithium (“Ganfeng”) and Hanwa Corporation, in 2023. Ganfeng remains fully committed to the advancement of Sonora’s development and continues to progress its investment schedule at the Sonora project level.

Sonora Operations

In Mexico, the Sonora government continues to maintain measures to prevent the spread of Covid-19 which includes, amongst other measures, the closing of schools and all non-essential business operations as well as cancelling events of more than 10 people. Accordingly, Bacanora’s Hermosillo pilot plant (“pilot plant”) was placed in care and maintenance in late March 2020 after shipping samples to its engineering partners in the USA and China in order to maintain the Front End Engineering Design (“FEED”) schedule. The pilot plant will remain closed until conditions are considered safe and the Government lifts its restrictions.  It is currently anticipated that the pilot plant will re-open in June 2020.

Bacanora CEO Peter Secker commented: “The entire team at Bacanora and our partners continue to work as best as we can during this pandemic. We remain fully focussed on progressing the final parts of the detailed design work for our flagship Sonora Lithium Project, located in Mexico. Bacanora also boasts a strong cash position and benefits from the support of its cornerstone shareholders, who are globally significant players in the electric vehicle industry.  The Company’s strategy remains the same and with the goal to deliver first product to its off-take partners in early 2023, importantly coinciding with the expected significant growth in EV demand.”

Cadence CEO Kiran Morzaria commented: “Our thoughts are with the Bacanora team as they work through the Covid-19 pandemic. We note Bacanora’s update on the Sonora development timetable, and in particular the Lithium market in general, detailing the forecast increase in demand to meet the ramp-up in EV production.”

(* www.euractiv.com/section/electric-cars/news/electric-car-sales-in-europe-jumped-57-in-q1-2020/

**www.bloomberg.com/amp/news/articles/2020-05-11/to-avoid-battery-metal-pinch-carmakers-urged-to-invest-in-mines )

The full Bacanora release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14555542.html

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling
Kiran Morzaria
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce
James Sinclair-Ford
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

 

Cadence Minerals (KDNC) Bacanora Lithium (BCN) – Sonora Lithium Project Update.

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the update published today by Bacanora Lithium (AIM:BCN) (“Bacanora”) on its activities at the Sonora Lithium Project in Mexico (‘Sonora’ or the ‘Project’) following the recent completion of the Strategic Investment by leading global lithium company Ganfeng Lithium Co., Ltd. (‘Ganfeng’).

Cadence Minerals – Holdings in BCN, Mexalit and Megalit:

Bacanora is a lithium exploration and development company. Cadence holds 30% of Mexalit and Megalit joint venture companies. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which forms part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Ganfeng Review and Process Testwork

The Bacanora project team in Mexico continues to progress the final design work for the mine site, infrastructure, concentrator and kiln sections of the processing plant. Representative samples have been sent to Ganfeng in China. Ganfeng’s technical review of the hydrometallurgical circuit has commenced with a view to potentially sourcing key sections of the lithium production equipment from their current equipment suppliers in China. This work is expected to be completed in H1 2020. As part of this technical review, both Bacanora and Ganfeng continue to develop testwork programmes for the potential production of other downstream high value lithium products in addition to the battery-grade lithium carbonate used in the Company’s feasibility study. The results of this work will be reviewed over the next few months. 

The feasibility study indicated highly favourable economic indicators for a battery grade lithium carbonate operation at Sonora, including US$1.25 billion NPV, 26% IRR and operating costs among the lowest in the industry at around US$4,000/t of lithium carbonate (see announcement of 13 December 2017 for further details).

Financing

Once Ganfeng completes its review, Bacanora will deliver final engineering costs for Stage 1 of the Project, following which Bacanora will look to finalise the funding package for the Project.   At this stage, the Company believes that the engineering costs will remain in line with the 2018 Feasibility Study forecast of approximately US$420 million. 

The recent 29.99% equity investment by Ganfeng Lithium and their 22.5% investment at the project level, in combination with a combined 100% off-take held by Ganfeng and Hanwa Corporation (‘Hanwa’) for Stage 1 production of 17,500 tonnes per annum of lithium products at the Project demonstrates the strong support that both these cornerstone investors have shown in Sonora. Combined, Ganfeng and Hanwa have a see-through ownership of more than 50% of Sonora.  In the last 18 months, Bacanora has already secured a US$150 million debt facility with RK Mine Finance and continues to explore additional sources of project funding. The 22.5% project investment and 29.99% equity investment from Ganfeng, in addition to ongoing support from Bacanora’s other shareholders and off-takers, ensures a very solid position for finalising the project funding stage of the Sonora development.

Bacanora had US$40 million of cash at the end of October 2019, which will enable it to commence the bulk earthworks on site in H1 2020 and start to upgrade the primary access road to site. Bacanora will also be able to use part of these funds to place the initial orders for some of the longest lead-time items in the concentrator, pyrometallurgy and hydrometallurgy sections of the lithium plant.

General Market Conditions

There have been a number of media reports over the past few months highlighting the impact of an over-supply of lower grade bulk spodumene concentrates from Australia into the Asian lithium converter markets. Recently a number of these projects have been delayed, closed, reported decreased production or put on care and maintenance. With the majority of these concentrate operations being at the higher cost level, this supports the Bacanora strategy of developing a fully integrated lithium project that produces a final battery grade lithium product at much lower costs rather than an intermediate concentrate.

Bacanora CEO Peter Secker said: “Recent research reports predict the lithium industry would need US$30 billion in investment in upstream capacity to meet its forecast of 1 million tonnes of supply by 2025 (a threefold increase on current levels).  In order to secure funding, any new lithium project needs to be low on the operational cost-curve, without having to rely on by-product credits to artificially lower that cost per tonne. A project also needs to have reliable engineering cost estimates.  A project needs to be of sufficient scale, in a location with a favourable environmental and political climate and deliver a high-grade end product. The Sonora Lithium Project is one of the very few projects globally that can deliver on all of these factors.”

The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14301803.html

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014. 

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling  
Kiran Morzaria  
   
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce  
James Sinclair-Ford  
   
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss  

 

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

  

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

 

Cadence Minerals (KDNC) – Bacanora Lithium (AIM:BCN) Completion of Strategic Investment by Ganfeng Lithium and Board Changes.

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the update published today by Bacanora Lithium (AIM:BCN) (“Bacanora”) on the Strategic Investment by leading global lithium company Ganfeng Lithium Co., Ltd. (“Ganfeng” or “GFL”). As announced on 28 June 2019, the signed Investment Agreement and Offtake Agreement, which together make up the Strategic Investment, were submitted to the relevant authorities in China for approval. Completion of the last of the relevant approvals has now been obtained and Bacanora has now received the £21,963,740 of funds from Ganfeng in exchange for a 29.99% equity interest in Bacanora Lithium PLC and a 22.5% JV investment directly in the Sonora Lithium Project (‘Sonora’). It is expected that the 57,600,364 shares in Bacanora will be admitted to trading on or around 18 October 2019.

Cadence Minerals – Holdings in BCN, Mexalit and Megalit:

Bacanora is a lithium exploration and development company. Cadence holds 30% of Mexalit and Megalit joint venture companies and approximately 0.5% of Bacanora’s equity. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which forms part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Update on Ganfeng and current activities at Sonora.

Ganfeng has recently announced its intention to proactively advance the development of Bacanora’s Sonora lithium clay project during the second half of 2019 with a number of initiatives. These will support Ganfeng’s target of 200,000 tonnes per annum lithium carbonate equivalent production capacity by 2025, although final capacity expansion will be based on changes in, and assessment of, future market demand for lithium products.

The Bacanora project team in Mexico continues to progress the final design work for the mine, concentrator and kiln sections of the processing plant. The Ganfeng technical team has initiated work on the hydrometallurgical circuit and is reviewing sourcing key sections of the lithium production equipment from current equipment suppliers in China.

Changes to Board of Directors.

Mr. Wang Xiaoshen, the Vice President of Ganfeng and the vice-chairman of its board of directors, is today appointed a director of Bacanora Lithium plc.

The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14264020.html

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014. 

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling  
Kiran Morzaria  
   
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce  
James Sinclair-Ford  
   
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss  

 

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

  

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

 

Cadence Minerals #KDNC – Interim Results for the six months ended 30 June 2019

Cadence Minerals plc announces interim Results for the six months ended 30 June 2019

 

 

HIGHLIGHTS

·    Cadence entered into an investment agreement to acquire up to 27% of the Amapá iron ore mine, beneficiation plant, railway and private port.

·      Before its sale in 2012 Anglo American valued  (impaired) its 70% stake in the Amapá iron ore mine at  US $462m ( 100% US $600m).

·      During its operation, the mine generated an annual operating profit of up to U$171 million (100%).

·      The total historic mineral resource contains an estimated 348 million tonnes (“Mt”) of ore @ 38.9% iron content (“Fe”).

·    Macarthur Minerals (Cadence equity ownership approx. 9%) refocused efforts on their iron ore assets and secured a binding Life-Of-Mine Off-Take Agreement with Glencore International A.G

·    European Metals (Cadence equity ownership approx. 19%) published a pre-feasibility study for the production of lithium hydroxide, increasing the net present value of the project 105% to US$1.1 BN.

INVESTMENT REVIEW

Amapá, Iron Ore Mine (“Amapá”)

In June this year Cadence Minerals entered into a binding investment agreement (“the  Agreement”) with Indo Sino Pte. Ltd. (“Indo Sino”) to invest in and acquire up to a 27% interest in the former Anglo American plc (“Anglo American”) and Cliffs Natural Resources (“Cliffs”) Amapá iron ore mine, beneficiation plant, railway and private port (“Amapá Project”) owned by DEV Mineração S.A. (“Amapá”).

The Amapá Project is a large-scale iron open pit ore mine with associated rail, port and beneficiation facilities and commenced operations in December 2007. Production increased to 4.8 Mt and 6.1 Mt of iron ore concentrate product in 2011 and 2012 respectively.

A summary of the asset is as below:

·      Before its sale in 2012 Anglo American valued its 70% stake in the Amapá Project at US$866 million (100% 1.2 billion) and after impairment valued it at  US $462m in its 2012 Annual Report ( 100% US $600m)

·      During its operation, the mine generated an annual operating profit of up to U$171 million (100%)

·      The total historic mineral resource contains an estimated 348 million tonnes (“Mt”) of ore @ 38.9% iron content (“Fe”)

·      The ore is beneficiated to 65% Fe Pellet Feed and 62% Fe Spiral Concentrate

·      Based on available historic mine plans and an independent consultant review it is expected that at full production the Amapá Project has a mine life of 14 years and at full capacity is targeting to produce up to 5.3 Mt of Iron Ore per annum

·      Subject key preconditions being met, the planned shipment of a 1.39 million tonne stockpile is scheduled to commence in December 2019. It is estimated that these stockpiles have a net realisable value of approximately US$ 60 million, which will be reinvested in the restart of the Amapá Project

·      Potential for the mine and existing infrastructure to be brought to market swiftly with mining and processing anticipated to restart in 2021 subject to the grant of the necessary permits, regulatory consents and project financing.

To acquire its 27% interest, Cadence will invest US$ 6 million over two stages. The first stage is for 20% of the JV Co the consideration for which is US$2.5 million. The second stage of investment is for a further 7% of JV Co for a consideration of US$3.5 million. Should Indo Sino seek additional investors or an investment in the JV Co the agreement also provides Cadence with a first right of refusal to increase its stake to 49% in the JV Co.

Our investment is conditional on several key preconditions the first is the approval of the judicial restructuring plan (“JRP”), which was completed at the end of August. Once the remaining pre-conditions relating to the reinstatement of a concession on the railway licenses and bank creditor arrangements have been met, the US$2.5 million investment placed in the judicial trust account will be released, and Cadence will own 20% of the Amapá iron ore project. This will enable the start of the shipping of the iron stockpile.

The approval of the JRP and the fulfilment of the preconditions outlined above will result in Cadence’s and IndoSino’s joint venture company Pedra Branca Alliance Pte Ltd. (“PBA”) owning 99.9% of DEV Mineração S.A. (“Amapá”). DEV Mineração S.A. is the owner of the Amapá iron project.

Cadence’s next stage of investment will be a further investment of US$3.5 million on the grant of all operational and environmental licenses for the Amapá Project, at which point Cadence will own 27%.

As part of the JRP Amapá submitted an outline of an operational and financial plan that Amapá intends to implement to bring the project back into production, which included the following

·      The total initial estimate of capital investment of approximately US$168 million, of which it is estimated US$61 million will be spent on port rehabilitation and US$47 million to be spent on plant recommissioning.

·      Rehabilitation to be completed by the end of 2021 with new production in 2022. Full production by 2024 of 5.3 million tonnes (“Mt”) of iron ore per annum.

·      At full production and using US$61 per tonne of 62% Fe Amapá is forecast to have:

·      an average net revenue after shipping of US$266 million per annum,

·      and an average EBITDA of US$136 million per annum.

European Metals Holdings Limited (“EMH”)

Cadence has been investing in European Metals since June 2015. As of the date of this document, Cadence holds approximately 19% in the Cinovec deposit in the Czech Republic through a direct holding in the share capital of European Metals that owns 100 per cent of the exploration rights to the Cinovec lithium/tin deposit. The Cinovec lithium and tin deposit is located in the Krusne Hory mountain range. The deposit that straddles the border between Germany and the Czech Republic and in Germany, it is known as the Zinnwald deposit (50% owned by Bacanora Lithium Plc ). The district has an extensive mining history, with various metals having been extracted since the 14th Century.

During the period EMH made significant progress. Drilling continued at the site with five of the eight-hole programme completed; this drilling programme was carried out to define the first two years of mining within the Cinovec-south area. The results of this programme have either been in line with or exceeded, EMH’s expectations particularly with regard to the tin intercepts.

In addition to the drilling results, EMH published a pre-feasibility study on producing battery-grade lithium hydroxide for as an alternative to battery-grade lithium carbonate. The result significantly enhanced the forecast economics of the Cinovec Project:

Highlights of the study are: (all $ figures in this release are US Dollars and increases refer to the 2017 PFS Lithium Carbonate study):

·           Net estimated overall cost of production post-credits: $3,435 / tonne LiOH.H2O

·           Project Net Present Value (“NPV”) increases 105% to: $1.108B (post-tax, 8%)

·           Internal Rate of Return (“IRR”) was increased 37% to 28.8% (post-tax)

·           Total Capital Cost: $482.6M

·           Annual production of Battery Grade Lithium Hydroxide: 25,267 tonnes

·           Studies are based on only 9.3% of reported Indicated Mineral Resource and a mine life of 21 years processing an average of 1.68 Mtpa ore

·           The process used to produce lithium hydroxide allows for the staging of lithium carbonate and then lithium hydroxide production to minimise capital and startup risk and enables the production of either battery-grade lithium hydroxide or carbonate as markets demand

After the period end, EMH entered into an agreement with CEZ Group(“CEZ”), one of Central and Eastern Europe’s largest power utilities, to conditionally provide a EUR 2 million finance facility by way of a convertible loan. CEZ is currently conducting due diligence on the Company and Project. The successful outcome of the due diligence process could see CEZ become European Metals’ largest shareholder and co-development partner for the Cinovec Lithium/Tin Project through conversion of the convertible note and subsequent additional investment.

Macarthur Minerals (“Macarthur”)

Cadence holds approximately 9% of the equity in Macarthur. Macarthur has three iron ore projects in the Yilgarn region of Western Australia. The Company has also established multiple project areas in the Pilbara, Western Australia for conglomerate gold, hard rock greenstone gold and hard rock lithium. In addition, Macarthur Minerals has significant lithium brine interests in the Railroad Valley, Nevada, USA.

During the period Macarthur focused its efforts on its Iron Assets in Western Australia.

The main highlights for Macarthur over the period were:

·       Opened an up to US$6 million institutional convertible note offer to fund the production of a Bankable Feasibility Study on Macarthur iron ore projects

·       Binding Life-Of-Mine Off-Take Agreement with Glencore International A.G for the Lake Giles Iron Ore Project for approximately 4 mtpa for the first 10 years on project start up

·       Macarthur entered into exclusive negotiation agreement with Aurizon for rail haulage services for the Lake Giles Iron Ore Project

·       Infill drilling program planned for the Moonshine magnetite deposit

·       Engineering firm Engenium commissioned to revise NI 43-101 compliant technical report and refine operating and capital costs of the hematite and magnetite projects

·       Applications have been made for three additional prospective iron ore tenements. These were properties released by Cliffs Natural Resources and are adjacent to the iron ore operations of Mt Jackson and Deception Mines

Bacanora Lithium Plc (“Bacanora”)

At the period end Cadence owned less than one per cent of Bacanora’s equity and a 30% stake in the Mexalit S.A. de CV (“Mexalit”) joint venture which forms part of the Sonora Lithium Project in Northern Mexico.

Bacanora has two lithium development assets, the Sonora Lithium Project and the Zinnwald Lithium Project. Bacanora has a 50% interest in, and joint operational control, of the Zinnwald Lithium Project. Zinnwald represents a strategic asset located near a thriving market for lithium and energy products.

Bacanora’s principal asset is the Sonora Lithium Project in northern Mexico. The asset has Measured plus Indicated Mineral Resource estimate of over 5 million tonnes (‘Mt’) (comprising 1.9 Mt of Measured Resources and 3.1Mt of Indicated Resources) of lithium carbonate equivalent (‘LCE’) and an additional Inferred Mineral Resource of 3.7 Mt of LCE, Sonora is regarded as one of the world’s larger known clay lithium deposits.

Bacanora continued to progress the strategic investment by Ganfeng Lithium Co., Ltd. (“Ganfeng”) during the period and signed the investment agreement at the end of June 2019, the key terms of which were:

·           Cornerstone strategic investment of 29.99% in Bacanora for £14,400,091 by Ganfeng

·           Project level investment of 22.5% in Sonora Lithium Ltd , the holding company for the Sonora Lithium Project, for £7,563,649

·           Additional long-term offtake at a market-based price per tonne

·           Gangfeng will complete a review within six months of the EPC engineering design and capital costs of Sonora Lithium Project with a view to reducing costs and accelerating the timetable

·           Gangfeng will provide a plant and process commissioning team to assist Bacanora in delivering first production in 2021

At the time of publishing Ganfeng was awaiting final approval from Chinese authorities to make its investment.

Yangibana Rare Earth Project

Cadence owns a 30% free carried interest in the Yangibana North, Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North rare earth projects in Western Australia. These projects form part of the larger Yangibana Rare Earth Project (“the Project”). The free carry is up to the commencement of the feasibility study.

A considerable amount of work over this period has been to define the geological resource and reserves, optimise the process flow, carry out detailed design and engineering work required for the setting up of a process plant, negotiations on equipment supply and no less crucial securing project finance. An early works permit was granted which allowed the initiation of infrastructure work and bring on-site a 340 rooms accommodation camp ready for occupation when mine construction commences.

On geology, there was a 34% increase in probable ore reserves to 10.35 million tonnes at 1.22% TREO including 0.43%Nd2O3+Pr6O11, supporting an initial 11 years operational life for the project based on the JORC certified resource of 21.7 million tonnes.

The current mine plan and production targets set out by the operator incorporates 10.35 million tonnes of Probable Ore Reserves, of which 1.96 million tonnes is part our joint venture asset, Yangibana North, which according to the operator’s production targets are scheduled to be mined from year 8 to year 14. These production targets include indicated mineral resources, hence the longer mine life.

Lithium Assets in Australia

In March this year Cadence announced that it has agreed to acquire three highly prospective assets in Australia that are in regions with proven high-grade lithium mineralisation. The mechanism to facilitate this acquisition was via varying binding investment agreements in place with Lithium Technologies Pty Ltd (“LT”) and Lithium Supplies Pty Ltd (“LS”) that Cadence entered on 11 December 2017 to acquire up to 100% of six prospective hard rock lithium assets in Argentina.

Highlights of the assets include:

·     The acquisition covers three projects – Picasso (Western Australia – WA), Litchfield (Northern Territories – NT) and Alcoota (NT) – that are located  in regions with proven lithium mineralisation and supportive mining infrastructure

·     The Picasso Project (license granted) is near Alliance Mineral Assets’ (ASX: A40; SGX: 40F; “AMA”) high-profile Bald Hill Mine in WA (note: AMA recently completed a 50:50 A$400m+ merger with delisted Tawawa Resources [ASX: TAW] & raised $40M to develop the  asset base)

·     Demonstrating exploration upside for Picasso, the Bald Hill Mine is producing a spodumene concentrate and has a JORC (2012) compliant mineral resource of 26.5Mt @ 0.96% Li2O; probable ore reserves at 11.3Mt @ 1.01% Li2O

Preliminary exploration work was concluded in April with positive results, and Cadence increased its stake from 4% to 24%. Early exploration work will begin soon to test and sample targets that have been identified during the preliminary exploration.

Other Investments

Cadence also retains equity positions in Sagon Resources Ltd (formerly Clancy Minerals Ltd) and Auroch Minerals Ltd. The latter being involved in base metal exploration in Australia, in particular, the Saints Nickel Project in Western Australia. Sagon Resources Ltd is currently exploring the Cummins Range Rare Earths Project.

FINANCIAL REVIEW

During the period, the Group made a loss before taxation of £0.28 million (30 June 2017: loss of £4.61 million). This was primarily due to an increase in the value on our portfolio, which offset administrative, financing and share of associated losses totalling £0.96 million.

There was a weighted basic loss per share of 0.003p (30 June 2017: loss per share 0.059p)  Foreign currency translation differences marginally decreased comprehensive loss for the period to £0.24 million (30 June 2017: total comprehensive loss of £4.66 million).

Administrative expenses decreased by £0.11 million compared to the same period last year; this decrease was driven by cost-cutting measures across the board.

The total assets of the group increased from £18.33 million at 31 December 2017 to £19.39 million. Of this amount, £2.33 million represent the market value of our available for sale investments at the period end. The reduction in the total assets is as a result of the decrease in the value of Bacanora equity, which was the primary driver for the reduction of available for sale asset value.

It is important to note that this does not include our investment in EMH. Our investment in EMH is classified as an investment in an associate and held at a value of £12.2 million. EMH is classified as such because we hold approximately 19% and Kiran Morzaria, the Chief Executive Officer of Cadence is also a Non-Executive Director of EMH.

Our borrowings of £3.71 million as at the 31 December 2017 reduced to £2.06 million by the end of the period as we paid back our convertible loans.

During the period, our net cash outflow from operating activities was £0.52 million compared to £0.45 million during the same period last year. We invested £0.27 million in Amapá, as part of our due diligence and JRP costs and our financing costs were some £0.19 million. We disposed of £1.42 of our available for sale investments which predominantly was our Bacanora equity. These sales were used to pay back some £1.59 million of our convertible loan during the period. We raised some £1.30 million of equity during the period which after netting of the aforementioned costs and revenue from the sale of our equity stake yielded resulted in a cash balance at the end of the period of £0.54 million

 

For further information, please contact

Cadence Minerals plc

+44 (0) 207 440 0647

Andrew Suckling

Kiran Morzaria

WH Ireland Limited (NOMAD & Broker)

+44 (0) 207 220 1666

James Joyce

James Sinclair-Ford

Novum Securities Limited (Joint Broker)

+44 (0) 207 399 9400

Jon Belliss

 

 

CADENCE MINERALS PLC

STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 30 JUNE 2019

 

Notes

Unaudited Period ended 30 June 2019

Unaudited Period ended 30 June 2018

Audited Year ended  31 December 2018

£’000

£’000

£’000

Income

Unrealised profit/(loss) on assets held for sale

1,118

(3,730)

(7,440)

Realised (loss)/profit on assets held for sale

(264)

105

(1,967)

Other income

4

48

140

858

(3,577)

(9,267)

Share based payments

(3)

(7)

Other administrative expenses

(672)

(785)

(1,559)

Total administrative expenses

(672)

(788)

(1,566)

Operating profit/(loss)

186

(4,365)

(10,833)

Share of associates losses

(274)

(182)

(555)

Finance cost

(197)

(59)

(377)

(Loss)/profit before taxation

(285)

(4,606)

(11,765)

 

 

 

Taxation

(Loss)/profit attributable to the equity holders of the Company

(285)

(4,606)

(11,765)

Other comprehensive income/(expenditure)

Foreign currency translation differences

47

(53)

(150)

Other comprehensive income/(expenditure) for the period net of tax

47

(53)

(150)

Total comprehensive expenditure for the period

(238)

(4,659)

(11,915)

Loss per share

Basic  (pence per share)

3

(0.003)

(0.059)

(0.150)

Diluted  (pence per share)

3

(0.003)

(0.051)

(0.145)

CADENCE MINERALS PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 JUNE 2019

 

Share capital

Share premium account

Share-based payment reserve

Hedging, Loan & Exchange reserves

Retained earnings

Total equity

£’000

£’000

£’000

£’000

£’000

£’000

Balance at 1 January 2018

1,202

27,552

3,178

337

(5,545)

26,724

Share based payments

3

3

Transfer on lapse of warrants

(132)

132

Transactions with owners

              –  

                –  

(129)

                –  

132

3

Foreign exchange

 –

 –

(53)

 –

(53)

Profit for the period

(4,606)

(4,606)

Total comprehensive loss for the period

              –  

                –  

              –  

(53)

(4,606)

(4,659)

Balance at 30 June 2018 (unaudited)

1,202

27,552

3,049

284

(10,019)

22,068

Share based payments

4

4

Transfer on lapse of warrants

(1,661)

1,661

On settlement of loan notes

(412)

(412)

Transactions with owners

              –  

                –  

(1,657)

(412)

       1,661

(408)

Foreign exchange

(97)

(97)

Loss for the period

(7,159)

(7,159)

Total comprehensive loss for the period

              –  

                –  

              –  

(97)

(7,159)

(7,256)

Balance at 31 December 2018

1,202

27,552

1,392

(225)

(15,517)

14,404

Issue of share capital

232

2,668

2,900

Costs of share issue

(105)

(105)

Transactions with owners

          232

         2,563

                –  

              –  

       2,795

Foreign exchange

 –

 –

47

 –

47

Loss for the period

(285)

(285)

Total comprehensive loss for the period

              –  

                –  

              –  

47

(285)

(238)

Balance at 30 June 2019 (unaudited)

1,434

30,115

1,392

(178)

(15,802)

16,961

 

 

 

 

 

 

 

 

 

 

 

CADENCE MINERALS PLC

STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2019

 

Unaudited

Unaudited

Audited

 30 June 2019

 30 June 2018

 31 December 2018

Assets

Notes

£’000

£’000

£’000

Non-current

Intangible assets

2,438

1,875

2,172

Investment in associate

12,170

12,918

12,483

14,608

14,793

14,655

Current assets

Trade and other receivables

1,919

461

315

Assets held for sale

2,330

9,946

2,895

Cash and cash equivalents

536

216

468

Total current assets

4,785

10,623

3,678

Total assets

19,393

25,416

18,333

EQUITY AND LIABILITIES

Current liabilities

Trade and other payables

372

290

223

Borrowings

2,060

3,058

3,706

Total current liabilities and total liabilities

2,432

3,348

3,929

Equity

Share capital

4

1,434

1,202

1,202

Share premium

30,115

27,552

27,552

Share based payment reserve

1,392

3,049

1,392

Hedging & Exchange reserve

(178)

284

(225)

Retained earnings

(15,802)

(10,019)

(15,517)

Total equity and liabilities

to owners of the company

16,961

22,068

14,404

Total equity and liabilities

19,393

25,416

18,333

CADENCE MINERALS PLC

CONSOLIDATED CASH FLOW STATEMENT

FOR THE PERIOD 30 JUNE 2019

 

Unaudited Period ended

Unaudited Period ended

Audited Year ended

30 June 2019

30 June 2018

 31 December 2018

£’000

£’000

£’000

Cash flows from operating activities

Operating profit/(loss)

186

(4,365)

(10,833)

Net realised/unrealised profit on assets held for sale

(854)

3,625

9,407

Equity settled share-based payments

3

7

Decrease/(increase) in trade and other receivables

(4)

261

407

Increase/(decrease) in trade and other payables

149

28

(39)

Net cash outflow from operating activities

(523)

(448)

(1,051)

Taxation

Cash flows from investing activities

Payments for investments in assets held for sale

(476)

(523)

Receipts on sale of assets held for sale

1,419

438

1,755

Receipts from sale of/(payments for) investments in associates

39

(50)

Investment in exploration costs

(266)

(100)

(325)

Net cash outflow from investing activities

1,192

(138)

857

Cash flows from financing activities

Proceeds from issue of share capital

1,300

Share issue costs

(105)

Net (loan repayments)/borrowings

(1,599)

(1,176)

(998)

Finance cost

(197)

(59)

(377)

Net cash inflow from financing activities

(601)

(1,235)

(1,375)

Net increase/(decrease) in cash and cash equivalents

68

(1,821)

(1,569)

Cash and cash equivalents at beginning of period

468

2,037

2,037

Cash and cash equivalents at end of period

536

216

468

 

NOTES TO THE INTERIM REPORT

FOR THE PERIOD ENDED 30 JUNE 2019

 

1 BASIS OF PREPARATION

 

The interim financial statements have been prepared in accordance with applicable accounting standards and under the historical cost convention.  The financial information set out in this interim report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The Group’s statutory financial statements for the year ended 31 December 2018 have been delivered to the Registrar of Companies. The auditor’s report on those financial statements was unqualified.

 

The principal accounting policies of the Group are consistent with those detailed in the 31 December 2018 financial statements, which are prepared in accordance with International Financial Reporting Standards (IFRSs), as adopted by the European Union.  IFRS16 – Leases has been adopted, but as the Group has no leases exceeding 12 months, this has had no impact.

 

GOING CONCERN

 

The Directors have prepared cash flow forecasts for the period ending 30 September 2019. The forecasts demonstrate that the Group has sufficient funds to allow it to continue in business for a period of at least twelve months from the date of approval of these financial statements. Accordingly, the accounts have been prepared on a going concern basis.

 

CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

 

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

 

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results

 

2 SEGMENTAL REPORTING

 

An operating segment is a distinguishable component of the Group that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the Group’s chief operating decision maker to make decisions about the allocation of resources and assessment of performance and about which discrete financial information is available.

 

The chief operating decision maker reviews financial information for and makes decisions about the Group’s performance as a whole. The Group has not actively traded during the period.

 

Subject to further acquisitions the Group expects to further review its segmental information during the forthcoming financial year.

 

3 PROFIT PER SHARE 

 

The calculation of the loss per share is based on the loss attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period.

 

Unaudited

Unaudited

Audited

six months ended

six months ended

year ended

30 June 2019

30 June 2018

31 December 2018

£’000

£’000

£’000

(Loss)/profit on ordinary activities after tax (£’000)

(285)

(4,606)

(11,765)

Weighted average number of shares for calculating basic loss/profit per share

  8,335,217,332

  7,851,440,338

  7,851,440,338

Share options and warrants exercisable

     280,000,000

  1,259,575,345

     280,000,000

Weighted average number of shares for calculating diluted loss/profit per share

  8,615,217,332

  9,111,015,683

  8,131,440,338

Basic loss per share (pence)

(0.003)

(0.059)

(0.150)

Diluted loss per share (pence)

(0.003)

(0.051)

(0.145)

 

4 SHARE CAPITAL

 

Unaudited

Unaudited

Unaudited

30 June 2019

30 June 2018

30 June 2018

£’000

£’000

£’000

Allotted, issued and fully paid

173,619,050 deferred shares of 0.24p (30 June 2018 and 31 December 2018: 173,619,050)

417

417

417

10,172,652,446 ordinary shares of 0.01p (30 June 2018 and 31 December 2018: 7,851,440,338)

                  1,017

                      785

                      785

                  1,434

                  1,202

                  1,202

 

Cadence Minerals #KDNC – Bacanora Lithium #BCN Update on Strategic Investment by Ganfeng Lithium

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the update published today by Bacanora Lithium (AIM:BCN) (“Bacanora”) on its Investment Agreement and Offtake Agreement (‘the Strategic Investment’ or ‘the Agreements’) with leading global lithium company Ganfeng Lithium Co., Ltd. (“Ganfeng” or “GFL”). As announced on 28 June 2019, the Agreements have been submitted to the relevant authorities in China for approval and completion.

The first of the approvals from the PRC Ministry of Commerce (MOFCOM) was received by Ganfeng at the end of July 2019, and Bacanora has now been informed that the second approval has been processed by NDRC (National Development and Reform Commission) and received by Ganfeng.  It is anticipated that the final approval from SAFE (State Administration of Foreign Exchange) will be received following a Ganfeng board meeting to be held in the coming weeks.  Bacanora will provide further updates once final approval is received.

Cadence Minerals – Holdings in BCN, Mexalit and Megalit:

Bacanora is a lithium exploration and development company. Cadence holds 30% of Mexalit and Megalit joint venture companies and approximately 0.5% of Bacanora’s equity. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which forms part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Summary of Key Terms of the Ganfeng Strategic Investment:

  • GFL to acquire 29.99% of Bacanora
  • GFL to acquire 22.5% of Sonora Lithium Ltd (“SLL”), the holding company for the Sonora Lithium Project
  • Additional long-term offtake at a market-based price per tonne
    • 50% of Stage 1 lithium production
    • Up to 75% of Stage 2 lithium production

The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14194708.html

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling
Kiran Morzaria
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce
James Sinclair-Ford
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

Cadence Minerals (KDNC) – Bacanora Lithium (BCN) Update on Strategic Investment by Ganfeng Lithium.

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the update published today by Bacanora Lithium (AIM:BCN) (“Bacanora”) on its Investment Agreement and Offtake Agreement (‘the Strategic Investment’ or ‘the Agreements’) with leading global lithium company Ganfeng Lithium Co., Ltd. (“Ganfeng” or “GFL”). As announced on 28 June 2019, the signed Agreements have been submitted to the relevant authorities in China for approval and completion.  The first of the approvals, from the PRC Ministry of Commerce, has now been received. The remaining two approvals required ahead of completion of the Strategic Investment are currently being processed by Ganfeng and further updates will be provided as the approval process proceeds. 

Bacanora is a lithium exploration and development company. Cadence holds 30% of Mexalit and Megalit joint venture companies and approximately 0.5% of Bacanora’s equity. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which forms part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Completion of the Strategic Investment would form a major part of the Bacanora’s finance package for an initial 17,500 tonnes per annum lithium carbonate operation at the large scale, high grade Sonora Project in Mexico.  For further details of the Agreements please refer to the Company’s announcement on 20 May 2019, however the key terms of the Strategic Investment are provided below:

Summary of Key Terms of the Ganfeng Strategic Investment:

  • GFL to acquire 29.99% of Bacanora
  • GFL to acquire 22.5% of Sonora Lithium Ltd (“SLL”), the holding company for the Sonora Lithium Project
  • Additional long-term offtake at a market-based price per tonne
    • 50% of Stage 1 lithium production
    • Up to 75% of Stage 2 lithium production

About GFL

GFL is the world’s third largest and China’s largest lithium compounds producer and the world’s largest lithium metals producer in terms of production capacity as of 31 December 2017, according to CRU International Limited.  GFL’s operations are vertically integrated, encompassing all critical stages of the value chain, including upstream lithium extraction, midstream lithium compounds and metals processing as well as downstream lithium battery production and recycling.  GFL has one of the most comprehensive product offerings split into five major categories of more than 40 lithium compounds and metals products.

The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14171449.html

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014. 

Restructuring of Outstanding Loan Note

As announced on the 15 July 2019 Cadence had restructured two of its three outstanding Amortising Loan Notes (http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2842635) and was finalising terms to fund the balance of the Amortising Loan Note. Cadence is pleased to announce it has now completed the restructuring of the third Amortising loan on substantially the same terms as outline in the announcement of 15 July 2019.

In addition, and to, in part, fund the working capital requirements of the Amapá Project, Cadence has drawn down a further US$ 0.5 million of the Convertible Loan Note under the same terms. After this draw down the outstanding balance on the Convertible Loan Note is US$3.98 million. Which is comprised of US$2.29 million of the restructured Amortising Loan notes plus a total of US$1.75 million of additional drawdowns. The note is secured over the Company’s assets.

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling  
Kiran Morzaria  
   
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce  
James Sinclair-Ford  
   
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss  

 

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

  

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling  
Kiran Morzaria  
   
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce  
James Sinclair-Ford  
   
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss  

 

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

  

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

 

Cadence Minerals #KDNC – Bacanora Lithium #BCN Signing of Investment and Offtake Agreement with Ganfeng Lithium.

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the announcement today by Bacanora Lithium (AIM:BCN) (“Bacanora”) that it has signed its Investment Agreement and Offtake Agreement (‘the Strategic Investment’) with Ganfeng Lithium Co., Ltd. (“Ganfeng” or “GFL”), the world’s largest lithium metals producer in terms of production capacity and the world’s third largest lithium compounds producer. Both agreements, which are on substantially the same terms as outlined in the Company’s announcement on 20 May 2019, have now been submitted to the relevant authorities in China for approval and completion. Completion of the Strategic Investment is anticipated by the end of July 2019 and would form a major part of the Company’s finance package for an initial 17,500 tonnes per annum lithium carbonate operation at the large scale, high grade Sonora Project in Mexico.

Bacanora is a lithium exploration and development company. Cadence holds approximately 1.5% of Bacanora’s equity and 30% of Mexalit and Megalit joint venture companies. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which forms part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Announcement Highlights:

  • Cornerstone strategic investment of 29.99% in Bacanora for £14,400,091
    • GFL has been granted pre-emption rights proportionate to its shareholding in Bacanora.
    • GFL shall appoint one Director to the Board of Bacanora.
  • Project level investment of 22.5% in Sonora Lithium Ltd (“SLL”), the holding company for the Sonora Lithium Project, for £7,563,649.
    • GFL has an option to increase its interest in SLL to up to 50% within 24 months at a valuation based on the share price of Bacanora at the time of subsequent investment.
    • GFL shall appoint one Director to the Board of SLL.
  • Additional long-term offtake at a market-based price per tonne.
    • 50% of Stage 1 lithium production.
    • Up to 75% of Stage 2 lithium production.
  • GFL will complete a review within six months of the EPC engineering design and capital costs of Sonora Lithium Project with a view to reducing costs and accelerating the timetable.

The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14129811.html

Cadence Minerals CEO Kiran Morzaria commented:“On behalf of Cadence Minerals, we are delighted to see Bacanora sign this milestone agreement with Ganfeng to develop the Sonora Lithium project. As Bacanora CEO Peter Secker says, Ganfeng’s operational expertise and industrial credibility is a strong endorsement of the Sonora Project’s potential.”

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling
Kiran Morzaria
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce
James Sinclair-Ford
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss

 

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

 

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

Cadence Minerals #KDNC – Bacanora Lithium #BCN Feasibility Study Estimates €428m NPV and 27.4% IRR for Zinnwald Lithium Project

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the announcement today by Bacanora Lithium (AIM:BCN) (“Bacanora”) regarding the results of the NI 43-101 Feasibility Study (‘FS’) for the Zinnwald Lithium Project in Germany (‘Zinnwald’ or ‘the Project’) which confirm the positive economics and favourable operating costs for the production of 5,112 tonnes per annum (‘tpa’) (~7,285 tpa LCE) of battery grade Lithium Fluoride (‘LiF’), a high value, downstream product used in the manufacture of lithium battery electrolytes for the European electric vehicle industry.  With a long life of project of 30 years, the FS estimates a pre-tax project Net Present Value (‘NPV’) of €428 million (8% discount rate); an Internal Rate of Return (‘IRR’) of 27.4%; favourable Life of Mine (‘LOM’) operating costs and a 46% EBITDA operating profit margin.

Bacanora is a lithium exploration and development company. Cadence holds approximately 1.7% of Bacanora’s equity and 30% of Mexalit and Megalit joint venture companies. Mexalit is the owner of the El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 mineral concessions, which forms part of the 20-year mine plan of the Sonora Lithium Project in Northern Mexico.

Announcement Highlights:

Confirmed strong economic potential

  • Estimated Project pre-tax IRR of 27.4%; NPV of €428 million (8% discount rate)
  • Estimated Project post-tax IRR of 21.5%, NPV of €270 million with a project payback of 6.1 years
  • Average LOM annual earnings before interest, taxes, depreciation and amortisation (‘EBITDA’) estimated at €58.5 million per annum
  • Long life project with the 30 year FS mine plan equating to less than 50% of the current identified mineral resources
  • Base case 30 years revenue and EBITDA estimated at €3.86 billion and €1.75 billion respectively

Zinnwald: a significant lithium deposit, strategically positioned in Germany’s industrial heartland

  • Total Mineral Reserve (Proven and Probable) estimate of 31.20 million tonnes (‘Mt’) of ore at a grade of 3,004 ppm containing 94 thousand tonnes (‘kt’) of contained lithium (‘Li’)
  • Demonstrated Mineral Resource (Measured and Indicated) estimate of 35.51 Mt of ore at a lithium grade of 3,519 ppm, containing 125 kt of Li
  • Deutsche Lithium also owns the exploration licences for the lithium deposits of the claims “Falkenhain” and “Altenberg DL” which have the potential to significantly increase Zinnwald’s resource base and Project life
  • Conventional flow sheet uses established sulphate route processing technology
  • Integrated plant designed to process approximately 570,000 tpa of ore (LOM average)
  • Capital cost estimate of €159 million includes mining, processing plant, infrastructure, tailings management, general administration costs as well as the requisite contingencies
  • FS includes sale of 32,000 tpa of by-product potassium sulphate (‘SOP’, ‘K2SO4’) to the European fertiliser industry

Next Steps: advance Zinnwald towards production to satisfy expected continued growth in demand for lithium driven by growing sectors such as electric vehicles and energy storage

  • Subject to Board approvals and other key milestone events, project detailed design is expected to commence in H1 2020

The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/BCN/14098768.html

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

– Ends –

 

For further information:

Cadence Minerals plc                                                    +44 (0) 207 440 0647
Andrew Suckling
Kiran Morzaria
WH Ireland Limited (NOMAD & Broker)                                 +44 (0) 207 220 1666
James Joyce
James Sinclair-Ford
Novum Securities Limited (Joint Broker)                                 +44 (0) 207 399 9400
Jon Belliss

 

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

Forward-Looking Statements:

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors.  Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.

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