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Cadence Minerals #KDNC – Hastings Technology Metals (ASX:HAS) Confirms No Appeals on EPA Recommendation of Environmental Approval for Yangibana

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce Hastings Technology Metals (ASX:HAS) (“Hastings”), Cadence’s joint venture partner at the Yangibana Rare Earth Project in the Gascoyne region of Western Australia (“Yangibana Project”), has announced that the Appeals Registrar (WA Office of the Appeals Convenor) has not received any appeals on the EPA Assessment Report, which recommends approval of the Yangibana Project subject to the proposed conditions.

Cadence owns 30% of the Yangibana North., Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North Rare Earth Deposit which form part of the Yangibana Rare Earth Deposit. Probable Ore Reserves of some 2.1 million tonnes at 1.66% total rare earth elements are contained within 30% owned joint venture tenements. Further details of these reserves and pre-feasibility study can be found at: http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2688632.

Highlights:

  • The Appeals Registrar (WA Office of the Appeals Convenor) has notified Hastings that they have received no appeals on the EPA’s recommendation to approve the Yangibana Project.
  • Next step in the approvals process is consultation with the Decision Making Authorities (“DMAs”), i.e. Ministers for Water, Mines and Aboriginal Affairs to obtain their agreement to the implementation of the project in accordance with the proposed conditions.

The DMAs will be provided with the draft conditions (as detailed in the EPA Assessment Report) for their consideration and must then provide their agreement to the implementation of the proposal subject to the draft conditions. The Minister for Environment will then consider the proposal and EPA recommendation.

The Yangibana project includes the development of five open pit mines, groundwater abstraction, on-site processing of ore, tailings storage facilities, access and haul roads and supporting infrastructure such as accommodation facilities, administration buildings and an airstrip.

The full release can be found at: https://www.asx.com.au/asxpdf/20190717/pdf/446p7m8wcdgm40.pdf

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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-LookingStatements:

Certain statements in this announcement are or may be deemed to beforward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – Hastings Technology Metals (ASX: HAS) – EPA (Environmental Protection Authority) recommends Environmental Approval for a Proposal to Mine & Process Rare Earths at Yangibana Project

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce that Hastings Technology Metals (ASX: HAS) (“Hastings”) has advised that the EPA has publicly released the Yangibana Rare Earths Project report, which is now open for a 2-week public appeal period, before being submitted to the Minister of Environment for final approval.

Cadence owns 30% of the Yangibana North., Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North Rare Earth Deposit which form part of the Yangibana Rare Earth Deposit. Probable Ore Reserves of some 2.1 million tonnes at 1.66% total rare earth elements are contained within 30% owned joint venture tenements. Further details of these reserves and pre-feasibility study can be found at: http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2688632.

Highlights from Hastings News Release:

  • Hastings has secured the next step in the approvals process allowing it to maintain construction commencement guidance for 2019 subject to final finance arrangements.
  • Yangibana has undergone a very thorough environmental impact assessment to the satisfaction of the Western Australian EPA, Department of Mines, Industry Regulation and Safety, and the Department of Water and Environmental Regulation and other key stakeholders.

The EPA considers impacts to water and human health were unlikely to be significant and could be managed under Part V of the Environmental Protection Act 1986, the Rights in Water Irrigation Act 1914, the Radiation Safety Act 1975, the Mines Safety and Inspection Act 1994 and the Mining Act 1978.

The proposal includes the development of five open mine pits, groundwater abstraction, on-site processing of ore, tailings storage facilities, access and haul roads and supporting infrastructure such as accommodation facilities, administration buildings and an airstrip.

Full Hastings ASX announcement here:

https://www.asx.com.au/asxpdf/20190627/pdf/4464xmxkn6xr63.pdf

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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-LookingStatements:

Certain statements in this announcement are or may be deemed to be forward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – Yangibana Rare Earth Joint Venture Partner signs Second Offtake MOU Agreement with Schaeffler AG

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce Hastings Technology Metals (ASX:HAS) (“Hastings”), Cadence’s joint venture partner at the Yangibana Rare Earth Project in the Gascoyne region of Western Australia (“Yangibana Project”), has signed a Second Offtake MOU Agreement with Schaeffler AG (“Schaeffler”).

Cadence owns 30% of the Yangibana North., Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North Rare Earth Deposit which form part of the Yangibana Rare Earth Deposit. Probable Ore Reserves of some 2.1 million tonnes at 1.66% total rare earth elements are contained within 30% owned joint venture tenements. Further details of these reserves and pre-feasibility study can be found at: http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2688632.

Hastings Announcement Highlights:

  • Hastings announces its second German offtake MOU and investment with Schaeffler for the future supply of Mixed Rare Earth Carbonate (MREC) from the Yangibana Project.
  • Schaeffler supported Hastings in its eligibility for the Euler Hermes German Government UFK loan scheme.

Schaeffler is a global automotive and industrial supplier of high-precision components and systems in engine, transmission, and chassis applications, as well as rolling and plain bearing solutions for a large number of industrial applications, primarily focussed on the automotive industry.  In 2018 it generated sales of approximately Euro 14.2 billion with around 92,500 employees, Schaeffler is one of the world’s largest family companies and, with approximately 170 locations in over 50 countries, has a worldwide network of manufacturing locations, research and development facilities, and sales offices.

Under the MOU, the parties have outlined their intent to enter into a binding commercial offtake agreement within the next 6 months for the sale and purchase of MREC, which will be produced from Yangibana, Western Australia. The framework for the commercial offtake agreement is set out in the MOU, and the final terms and conditions will be formalised in a contract. Schaeffler’s intention in entering into an offtake agreement is to ensure reliable supplies of rare earth material in the future.

The Parties have undertaken to negotiate in good faith to reach agreement for a 10 year commercial offtake contract to supply MREC which contains the critical raw materials of neodymium (Nd) and praseodymium (Pr).  NdPr is a critical raw material used in the manufacture of permanent magnets, the key component in electric motors.

Schaeffler is also supporting Hastings in its eligibility for the German government’s untied loan guarantee scheme (known as UFK) in its project financing for the construction of its mine and processing plant in the Upper Gascoyne of Western Australia.

The full release can be found at: https://www.asx.com.au/asxpdf/20190611/pdf/445qzvlt14cb9w.pdf

Cadence Minerals CEO Kiran Morzaria commented: “This second offtake agreement announced with Schaeffler provides further validation of the Yangibana Project potential and our joint venture strategy with Hastings Technology Metals. We look forward to further developments.”

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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 beforward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – Hastings Technology Metals (ASX: HAS) takes key steps towards Yangibana development with additional accommodation camp purchase.

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce that Hastings Technology Metals (ASX: HAS) (“Hastings”) has announced that it has agreed to purchase an additional 100 bedrooms of camp capacity plus other associated infrastructure from Fleetwood Pty Ltd.

Cadence owns 30% of the Yangibana North., Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North Rare Earth Deposit which form part of the Yangibana Rare Earth Deposit. Probable Ore Reserves of some 2.1 million tonnes at 1.66% total rare earth elements are contained within 30% owned joint venture tenements. Further details of these reserves and pre-feasibility study can be found at: http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2688632.

Highlights from Hastings News Release:

  • Hastings enters agreement to purchase 100 extra rooms plus associated infrastructure from Fleetwood Pty Ltd.
  • Purchase takes the total number of rooms purchased to 340 out of a total of 380 identified as required during the construction of the mine and processing plant.

The camp acquisition agreement represents a significant capital saving for the project and a discount of approximately 35% compared to the cost estimate of buying new.

The opportunity to acquire the camp, whilst being financially attractive, will also help reduce pressure on the development timetable. The balance of 40 rooms identified as a requirement during peak production will not be needed until approximately 8 months after commencement of construction.

The Yangibana Project involves the development of Rare Earth’s deposits rich in neodymium and praseodymium, elements vital to permanent magnets that provide many critical components of wide-ranging high-tech products, including electric vehicles, renewable energy wind turbines, robotics, medical applications and others. The development of this project is expected to bring benefits to the Gascoyne, Carnarvon and Meekatharra regions of northern Australia including through employment and business opportunities. The Yangibana Project aims to be the next significant producer of neodymium and praseodymium outside of China.

Full Hastings ASX announcement here:

https://www.asx.com.au/asxpdf/20190513/pdf/44517n3nrcljt0.pdf

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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-LookingStatements:

Certain statements in this announcement are or may be deemed to be forward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – Hastings Technology Metals (ASX: HAS) receives in-principle eligibility from Euler Hermes for Yangibana Rare Earth Project financing of up to USD140m

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce that Hastings Technology Metals (ASX: HAS) (“Hastings”), has announced that it has successfully received in-principle eligibility for the German United Loan Guarantee Scheme (UFK – Garantien für Ungebundene Finanzkredite) from Euler Hermes Aktiengesellschaft (“Euler Hermes”) who are mandated by the German Federal Government as administrators of the UFK scheme for an indicative amount of up to USD140 million (approx AUD200 million). The UFK scheme offers concessionary loan terms typically over a period of seven years.

Cadence owns 30% of the Yangibana North., Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North Rare Earth Deposit which form part of the Yangibana Rare Earth Deposit. Probable Ore Reserves of some 2.1 million tonnes at 1.66% total rare earth elements are contained within 30% owned joint venture tenements. The Probable Ore Reserves of the entire Yangibana Rare Earth Deposit is 10.35 million tonnes at 1.22% total rare earth elements. Further details of these reserves and pre-feasibility study can be found at:

http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2688632.

Highlights from Hastings News Release:

  • In principle eligibility for the German Government UFK scheme confirmed for up to USD 140 million (approx AUD 200 million) from Euler Hermes.
  • UFK scheme offers concessionary project finance loan terms for a period of seven years.
  • Progressing on due diligence on the technical, economic, environmental, legal and special aspects of the Yangibana project.

The confirmation is based on the understanding that a German Tier 1 company will be the off-taker for a minimum of 5,000 tonnes of Mixed Rare Earth Carbonate (MREC) per annum from Hastings’ Yangibana Rare Earth Project for a minimum contract period of 10 years. Further due diligence is being undertaken on the economic, technical, legal, environmental and social aspects and the UFK loan application will be subject to final approval by the German Government’s Inter Ministerial Committee.

As announced in July 2018, Hastings has exclusively mandated the German bank, KfW IPEX-Bank GmbH (“KfW IPEX Bank”) to provide project finance loan advisory services and assist Hastings in relation to securing approval from Euler Hermes Aktiengesellschaft (“Euler Hermes”) for the UFK Cover. KfW IPEX-Bank, a wholly owned subsidiary of the KfW Group is a leading German export and project finance specialist with significant experience in the debt financing of mining projects worldwide.

The Yangibana Project involves the development of Rare Earth’s deposits rich in neodymium and praseodymium, elements vital to permanent magnets that provide many critical components of wide-ranging high-tech products, including electric vehicles, renewable energy wind turbines, robotics, medical applications and others. The development of this project is expected to bring benefits to the Gascoyne, Carnarvon and Meekatharra regions of northern Australia including through employment and business opportunities. The Yangibana Project aims to be the next significant producer of neodymium and praseodymium outside of China.

Full Hastings ASX announcement here:

https://www.asx.com.au/asxpdf/20190430/pdf/444pdwcg68002c.pdf

Cadence Minerals CEO Kiran Morzaria commented:“The team at Cadence are encouraged that Hastings Technology Metals continues to progress financing options for the Yangibana Rare Earths Project. We look forward to further developments.”

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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-LookingStatements:

Certain statements in this announcement are or may be deemed to be forward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – Hastings Technology Metals (ASX: HAS) says NAIF is reviewing Yangibana Rare Earth Project, Australia for Possible Funding

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce that Hastings Technology Metals (ASX: HAS) (“Hastings”), the 70% owner and operator of the Yangibana Rare Earth Project (“Yangibana”) in which Cadence is a joint venture partner with 30%, has announced that the Australian Government’s Northern Australia Infrastructure Facility (“NAIF”) has indicated it will further investigate the potential for NAIF to provide debt finance for Yangibana.

Highlights from Hastings News Release:

  • The Northern Australia Infrastructure Facility (NAIF) is further investigating the potential to provide debt financing to the Yangibana Rare Earths Project.
  • NAIF’s funding has potential to finance the majority of the Yangibana Project’s infrastructure and related costs.
  • Hastings has commenced work in preparing the required formal Investment Proposal required as part of the next steps to progress due diligence by NAIF.

The Yangibana Project involves the development of rare earths deposits rich in neodymium and praseodymium, elements vital to permanent magnets that provide many critical components of wide-ranging high-tech products, including electric vehicles, renewable energy wind turbines, robotics, medical applications and others. The development of this project is expected to bring benefits to the Gascoyne, Carnarvon and Meekatharra regions of northern Australia including through employment and business opportunities.  The Yangibana Project aims to be the next significant producer of neodymium and praseodymium outside of China.

Hastings has commenced the process of preparing its Investment Proposal for NAIF’s consideration and this represents a major milestone in Hastings engagement with NAIF and in potentially securing debt finance for the project. NAIF has not yet made any decision to offer debt finance and there is no certainty that an agreement will be reached between the parties.

NAIF is a major initiative of the Australian Government. NAIF has access to a A$5 billion lending facility which can provide a range of loan concessions, to support infrastructure development that generates public benefit for Northern Australia. It also encourages and complements private sector investment to further that objective.

NAIF’s due diligence is under way and Hastings will continue to assist NAIF with further specific requirements to facilitate the process for seeking approval for providing debt finance to the Yangibana Project.

Full Hastings ASX announcement here:

https://www.asx.com.au/asxpdf/20190327/pdf/443svmmmwfzvsn.pdf

Details of Ownership

On 1 December 2011, Cadence announced that it had acquired a 30% free carried interest to Bankable Feasibility Study of the Yangibana North Rare Earth Deposit. The exploration costs until the commencement of the BFS are therefore borne solely by Hastings (70% owners and operator). The same terms agreed and announced on 1 December 2012 also apply to Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North.

Probable Ore Reserves of some 2.1 million tonnes at 1.66% total rare earth elements are contained within 30% owned joint venture tenements. Further details of these reserves and pre-feasibility study can be found at http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2688632

Cadence Minerals CEO Kiran Morzaria commented:

“Cadence is encouraged that the Yangibana Project and our joint venture owner operator partner could potentially benefit from NAIF debt financing, particularly if as stated by Hastings Chairman Charles Lew that if approved, Hastings can push ahead with its stated goal of construction commencement in H2 2019.”

– 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
Hannam & Partners LLP (Joint Broker) +44 (0) 207 907 8500
Neil Passmore
Giles Fitzpatrick
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-LookingStatements:

Certain statements in this announcement are or may be deemed to be forward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – First Ore Reserves Declared on Rare Earth Joint Venture Ground, Yangibana, Australia

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce that a maiden Ore Reserves has been declared on Cadence’s 30% joint venture ground at the Yangibana Rare Earth Project in the Gascoyne region of Western Australia (“Yangibana Project”).  The total Probable Ore Reserves on our joint venture are 2.07 million tonnes (“Mt”) at 1.66%  Total Rare Earths (“TREO”) including 0.43%neodymium oxide (“Nd2O3”) and praseodymium oxide (”Pr6O11.“).

Highlights from Hastings Technology Metals News Release:

  • Probable Ore Reserves on entire Yangibana Project increase 34% to 10.35 million tonnesat 1.22%TREO including 0.43%Nd2O3+Pr6O11
  • Updated Ore Reserve extends mine life by 3 years, supporting a +10-year operational life for the Project
  • Updated Ore Reserve increases Yangibana Project NPV to AUD516Mconfirming outstanding project economics
  • Includes the first Ore Reserves from joint venture ground

The Yangibana Project hosts rare earths deposits rich in neodymium and praseodymium, elements vital to permanent magnets that provide many critical components of wide ranging high-tech products, including electric vehicles, renewable energy wind turbines, robotics, medical applications and others. The Yangibana Project aims to be the next significant producer of neodymium and praseodymium outside of China.

Probable Ore Reserves

These joint venture Ore Reserves are contained within the Yangibana (M09/163) and Yangibana North (M09/159) tenemants and and form part of the larger Yangibana Project which contains Ore Reserves of 10.35 Mt at 1.22%TREO including 0.43 %Nd2O3+Pr6O11.

The Probable Ore Reserves were based on the Pre-Feasibility level study (“PFS”) information and recent geological, geotechnical, metallurgical and environmental work. Independent consultants Snowden Mining Industry Consultants (Snowden) has completed an updated mining reserve estimate based on Measured and Indicated Mineral Resources at each of Bald Hill, Fraser’s, Auer, Auer North, Yangibana, Yangibana West and Yangibana North deposits. This mining reserve estimate used Whittle pit optimisation software to maximise ore recovery using conventional drill and blast, load and haul mining methods.

The Probable Ore Reserves quoted in this document are derived from Measured and Indicated Resources as reported in our joint venture partners (“Hastings”) ASX announcement titled “Increase in Measured and Indicated Resources at Yangibana Project” dated 22nd November 2018.

The Probable Ore Reserves contained within 30% owned joint venture tenements are as shown in Table 1.

Table 1 – Yangibana Project – Probable Ore Reserves Within Tenements Held 30% by Cadence, December 2018

Deposit Tonnes %TREO %Nd2O3+Pr6O11 Nd2O3+Pr6O11 as a percent of TREO
Yangibana 110,000 0.60 0.28 47
Yangibana North 1,964,000 1.72 0.44 26
TOTAL 2,074,000 1.66 0.43  

Full details of the derivation of these Ore Reserves, inclusive of Mineral Resources, Cut-Off Parameters, mining factor, metallurgical factors and assumptions, environmental and social factors can be found in the full ASX release by Hastings here:

https://hastingstechmetals.com/download/68/2019/4414/reserves-increase-by-34-to-10-35mt-covering-10-years-operation-at-yangibana-project.pdf

Production Targets

The current Ore Reserve Statement has ore reserve estimates resulting from the design of several open pits that will produce mixed rare earth carbonates (“MREC”) over the current life of the project.

Capital and Operating costs are derived by independent third-party industry recognised specialists. The current Capex of $335M remains unchanged from the previous 2017 DFS. Operating costs reflect the mining and infrastructure setup costs of all pits within the mining schedule. Processing operating costs remain unchanged from the previous 2017 DFS study.

Additionally, over the life of the project a $17M allowance has been made in the operating cost for miscellaneous mining items for all the open pits within the mining schedule.

Current production targets on an annualised basis are to produce up to 15,000 tpa of MREC. The MREC will contain up to 8,850 tpa Total Rare Earths Oxides, of which up to 3,400 tpa will be neodymium oxide and praseodymium oxide. The mining schedule indicates the commencement of mining from the joint venture areas beginning in year 6 (2026) of with the large majority of the mined ore being derived from Yangibana North (M09/159) from year 8 onwards.

Revenue Factors

The PFS financial model assumes an average long-term US$/A$ exchange rate of 0.71 and uses Adamas Intelligence price forecasts for rare earths prices in 2021. Financial evaluation of the Probable Ore Reserves in the PFS results in the economic outcome shown in Table 2.

Table 2 – Yangibana Project – PFS Financial Evaluation Results

Operating Life 12 years
Net Present Value (NPV) A$516 M
Internal Rate of Return (IRR) 32.0%
Payback Period 2.7 years

 

The economic model assumes that Cadence’s wholly owned subsidiary Mojito Resources will participate in the development of the deposits held by Hastings (70%) in joint venture with Mojito Resources (30%) under the ‘Yangibana Joint Venture Agreement’. The specific deposits to which the joint venture applies are Yangibana and Yangibana North.

If there is a mine development by the joint venture, not only will there need to be a Mining Joint Venture Agreement agreed and put in place to replace the existing joint venture documentation and regulate the arrangements between the participants for the mine development, but arrangements will also need to be established to determine how the Yangibana production and tenements the subject of the joint venture fit with the broader 100% Hastings group owned production and tenements.

No costs or revenue ascribed to the 30% interest in the deposits held by Mojito Resources are reported in the financial modelling. If Mojito Resources did not participate in any development of the joint venture deposits and the development of those deposits was to proceed on a 100% basis by Hastings, then the economic model would need to be updated to allocate those costs and revenues to Hastings.

The estimates in this study relating to mining, processing and cost performance are underpinned by an updated PFS which has a confidence range of ±25%.

Details of Ownership

On 1 December 2011, Cadence announced that it had acquired a 30% free carried interest to Bankable Feasibility Study of the Yangibana North Rare Earth Deposit. The exploration costs until the commencement of the BFS are therefore borne solely by Hastings (70% owners and operator). The same terms agreed and announced on 1 December 2012 also apply to Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North.

Cadence Minerals CEO Kiran Morzaria commented: “It is great to see the inclusion of Cadence’s joint venture ground within the mine plan of the Yangibana Project, and we look forward to working with Hastings Technology Metals to progress the Mining Joint Venture and crystalise value to Cadence’s shareholders.”

“The Yangibana Project has high grades in neodymium and praseodymium, which are critical in the manufacture of permanent magnets used in the motors of electric vehicles. In 2017, 75% of the rare earth market by value was represented by neodymium and praseodymium, and we see Yangibana as an important part of that supply chain.

– 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
Hannam & Partners LLP (Joint Broker) +44 (0) 207 907 8500
Neil Passmore
Giles Fitzpatrick
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-LookingStatements:

Certain statements in this announcement are or may be deemed to be forward-lookingstatements. Forward-lookingstatements 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-lookingstatements 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 keypersonnel 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-lookingstatements.

Cadence Minerals #KDNC – Interim Results for the six months ended 30 June 2018

Cadence Minerals plc, (AIM/NEX: KDNC; OTC: REMMY), which invests in highly prospective lithium and rare earth mineral projects, announces its interim results for the six months ended 30 June 2018.

HIGHLIGHTS

·      Fundamental Supply of Lithium Compounds remains constrained

·      Long-term battery grade lithium pricing increased during the period and remains US$15,000 per tonne

·      European Metals Holdings (“EMH”) the owner of the Cinovec project in the Czech Republic;

·      Completed test work on roast improving lithium recoveries to 95%.

·      Announced a revised pre-feasibility study which will envisage the production of lithium hydroxide which is currently priced at around US$17,000 per tonne.

·      Reconnaissance exploration was completed at San Luis lithium project which has identified some 10 thousand hectares of prospective ground of lithium bearing pegmatites.

·      Subsequent to the year-end Macarthur entered into an exclusive advisory agreement with UK based Capstan Capital Partners LLP (“Capstan”) to seek the necessary funding required to advance Macarthur’s significant iron ore projects located in Western Australia.

STRATEGIC REVIEW

By most of the fundamental measures in supply and demand dynamics, whether it be constrained supply chains, strong product pricing or build out capacity for the product, the long-term outlook for lithium and lithium compounds remains strong.

Nonetheless, for 2018, there have been several analysts that have continued to suggest a wave of supply of lithium compounds and therefore a softening in lithium prices. Our research and “boots on the ground” approach tells a very different story.

The oversupply camp point to increasing capacity from China, Australia and the Atacama that will swamp the market. However, this fails to take account of two critical points. Firstly, the delivery of battery grade lithium compounds is not easy, even with the typical commissioning delays associated with mining projects, there is then the added aspect of a complex and capital-intensive hydrometallurgical plant, to get these commissioned and financed is difficult. Therefore, the reality is the supply will be delayed in our view, and only those projects with sufficient scale and competitive cost structure will be able to attract the financing to enter the supply chain.

Secondly, the additional capacity from Australia is, for the large majority, shipped as spodumene to China, where it is converted to lithium compounds. So, to understand supply, you need to understand the conversion capacity of China, which by all accounts are struggling to install new conversion plants in time and will probably be only able to produce 200,000 tonnes of lithium carbonate in 2019. Both of the above point to a constrained supply chain and not a wave of supply.

When we look at pricing over the period, several detractors will point to the drop in the price of Lithium compounds in China. The reality is that Chinese pricing was influenced in part by brine projects in China needing to sell below battery grade lithium carbonate to fund operations. To us, the most representative pricing of battery grade lithium carbonate is from South America where pricing continued to increase over the year and currently trades at around US$15,000 per tonne of battery grade lithium carbonate.

Despite all of these constraints in supply and the positive outlook on the demand side equities in the lithium market have softened considerably during the year with the Global X lithium ETF dropping by 19% over the six months to June 2018, with some lithium project developers dropping up to 65% over the same period.

Our investments were not immune to this softening, and our principle two investments in Bacanora Lithium and European Lithium reduced in price by 20% and 53% respectively. This, in turn, was reflected in our share price performance which reduced by 33% over the period and our absolute return figures which  were at the period ended 26% which is in line with the return figures on Global X Lithium ETF over the same period.

Table 1: Absolute Return Figures

30/06/2017

31/12/2017

30/06/2018

Book Value (GB£ ,000)

17,904

11,345

11,104

Mark to Market Equity Value (GB£ ,000)

30,882

24,869

14,005

Absolute Return on Equity (%)

72%

119%

26%

Global X Lithium & Battery Tech Returns (%)

13%

51%

27%

 

Despite the performance of our investments, the underlying projects remain sound and have the right cost structure and scale to potentially be significant contributors to the battery supply chain.

Of note was the progress that European Metals Holdings have made during the year. It has improved roast recoveries in their lab test work, and since the end of June 2018 they received approvals to carry out geotechnical drilling and announced that they would be carrying out a revised pre-feasibility study to produce lithium hydroxide which is scheduled to be published in the coming months. Given the pricing and demand for this compound, we would hope to see an improvement in the economics of the project.

Bacanora continued to make progress during the year at a project level, however, as a result of market volatility in the lithium markets, it decided not to proceed with the equity portion of its project financing. It is continuing the front-end engineering design of the project and has drawn down US$25 million of its US$150 million debt facility.

The board and its strategy have evolved significantly since 2014. Its focus since September last year is to invest in earlier stage exploration projects, as this is typically where the largest return is for relatively low levels of investment capital. The risk associated with investing in any resource projects at an early stage is high, therefore, and in order to mitigate this risk, our goal from the outset is to obtain a deep fundamental understanding of the resource, its chemistry and management team.

By doing so, we can eliminate the many of the potential investments that we review during the year and fund projects that we believe will deliver value to our shareholders. We look to fund projects via earning in, at solely our option, and if at all possible look to incentivise our joint venture partners via equity in Cadence against deliverables that will add value. Importantly we also take an active approach to our investments by being part of the management team and enshrining our minority shareholder protections in joint venture agreements.

During the six months, we have reviewed numerous projects, inclusive of brines in the Atacama, Cobalt in the USA, and pegmatites in multiple places in Africa, all of which had their attractions however they did not match our investment criteria so were rejected.

We continue to review possible investments and seek out new opportunities always with the ultimate aim of securing an asset that has the potential to add significant value to our share price.

The future remains very exciting for the Company. We will continue to review our investments in our investee companies, with regular meetings with management. Importantly we will continue to examine the market perception of lithium and if required ensure we limit our exposure to further downside in our equity positions. 

INVESTMENT REVIEW

Bacanora Lithium Plc (“Bacanora”)

At the period end Cadence owned 8.3% 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.

In January 2018 Bacanora published its Feasibility Study (“FS”) on the project. The FS targeted a two-stage open-pit operation, reaching 35,000 tonnes (t) of lithium carbonate (Li2CO3) per annum (“tpa”) in year four. The FS has a pre-tax NPV of US$1.25 billion and an IRR of 26%. The capital and working capital costs of the first stage of production (17,500 t of Li2CO3 per annum) is estimated to be US$460 million. Under our estimation, The FS mine plan currently has some 12% of the plant feed being mined from the 30% joint venture areas owned by Mexalit.

After the period end, Bacanora announced its financing strategy and were able to secure a US$150 million debt funding from RK Mine Finance. Additionally, Bacanora was able to secure conditional investments totalling US$90 million from the State General Reserve of Oman and Bacanora’s off-take partner, Hanwa Co., Ltd. These combined financing represented US$240 million of the US$460 million required. In July Bacanora elected not to proceed with a further US$100 equity placing, citing current volatility in global commodities markets.

Both our 8.3% equity stake in Bacanora and our ownership in the Mexalit joint venture could represent a substantial return for Cadence in the form of cash flow from the Sonora Lithium Project. Which we estimate could be as much  US$106 million (net present value, 10% discount) using a lithium carbonate price of 13,000 per tonne and a dilution of 3X of the current equity on issue in Bacanora. This is of course contingent on Bacanora securing the necessary financing and executing the development of the Sonora Lithium project as per the FS published in January this year.

European Metals Holdings Limited (“EMH”)

At the end of June 2018 and as a result of share issues by EMH Cadence held a 19.7% in EMH, through this equity holding we have an economic interest in the Cinovec lithium and tin deposit.

At an operational level, the Cinovec lithium project progressed well. However, this progress was overshadowed by Czech presidential elections and, in particular, the statement of the Czech Minister of Industry and Trade which purported to terminate the memorandum of understanding between EMH and Czech Ministry of Industry of Trade. As stated by EMH the termination of the MOU does not in any way affect the exploration rights of EMH tenure over its exploration permits.

Despite this, there were substantial strides made in the development of the Cinovec Lithium Project. Of note was the improvement in lithium recoveries announced in March, which was increased to 95%. In addition, EMH continued to work on the pilot scale beneficiation work, this work along with the improved lithium recoveries meant that subsequent to the period end EMH was able to report increased lithium production from 20,800 tpa to 22,500 tpa.

Moreover, EMH has commenced work on an update of the Preliminary Feasibility Study to model the production of higher value lithium hydroxide due to its increasing use in lithium-ion batteries. We expect the results from this to be announced in the coming months. 

San Luis Lithium Project

In December 2017 Cadence Minerals announced that it had executed binding investment agreements to acquire up to 100% of six prospective hard rock lithium assets in Argentina.

These transactions mark the start of the Company’s strategic shift to earn into early stage lithium assets in well-known lithium jurisdictions where we see the potential to deliver shareholder value by investing in projects that have shorter development timeline to cashflow than a typical lithium carbonate producer.

The San Luis Project Consist of claims over 55,773 hectares for six exploration permits within the known spodumene bearing pegmatite fields in San Luis Province, Central Argentina.

During the period under review the investee’s geology team, utilising a range of remote sensing and geographical information system (GIS) tools, have completed several desktop studies which identify highly prospective areas for lithium mineralisation in known spodumene bearing pegmatite bodies. Encouragingly, there are multiple indicators that confirm the presence of spodumene bearing pegmatite bodies including geological structural features, aero-magnetic radiometric data analysis, satellite imagery and differentiation in granitic bodies.

The net result is that out of the 55,773 hectares, comprising the six assets total area, the geology team have identified 10,049 hectares as high-priority areas for the next phase of the exploration programme

Finalised Environmental Impact Assessments have been submitted to the mining regulator for these high priority areas, with applications for drilling permits to follow

The project team are now in discussions with third-party suppliers, including drilling contractors, and intend to fast-track the next phase of exploration as soon as regulatory approval is secured.

On grant of the exploration permits Cadence will acquire up to 49% by spending £1.1m on exploration and drilling, and by issuing £0.4 million of new ordinary shares in Cadence to The Vendors. Cadence has an option to acquire up to 100% by issuing a further £1.75m of new ordinary shares in Cadence. During the period Cadence completed its initial £0.10 million investment for 4% of the exploration permit.

Auroch Minerals

At the end of the period Cadence had a 6.6% interest in Auroch Minerals, its focus over the period under review has been the development of the high-grade zinc, Bonaventura Project and the Arden zinc, copper-cobalt project. Drilling has commenced at both of these highly prospective projects, both of which are expected to take between six and eight weeks to complete.

The Bonaventura Project contains several historic artisanal mines for zinc, lead, copper, gold and silver that were worked at various times up to the 1920’s. Soil-sampling over the Bonaventura Project has been completed with zinc anomalism following the strike of the regional Cygnet-Snelling Fault.

The Vinco Target, which is situated 1,500m along strike from Grainger target, has previously been surveyed using high-resolution aeromagnetics, including induced polarisation (IP) and gravity surveys.

The IP survey interpretation over the Dewrang target identified two-highly chargeable anomalies at approximately 200m depth over a strike length of over 400m. Anomalies indicate the potential for the presence of high-grade base-metal sulphides, making Dewrang a high-priority area for exploration.

In addition to the base metal targets, the Kohinoor target remains highly prospective for gold mineralisation, with historic composite samples taken from the first level of the main historic workings.

The Arden project consists of a Sedex type potential deposit. The Sedex potential was initially discovered by Kennecott (Rio Tinto Group) between 1966 and 1972, identifying anomalous Sedex-style zinc mineralisation up to 40m wide and with a potential for over 10km of the strike. However, since 1980 the area has been the focus of regional diamond exploration, and as such the Sedex horizon at the Ragless Range Target had not been explored.

Auroch has moved quickly to realise the project potential, undertaking reconnaissance field mapping, rock-chip sampling,a reinterpretation of historical data and an Aeromagnetic survey before initiating its maiden drill programme in August 2018. Arden enjoys access to world-class infrastructure including the railway to Port Augusta, which passes just to the south of the tenement.

Macarthur Minerals (“Macarthur”)

Cadence at the end of the period had 12.1% equity interest in Macarthur, which is an Australian mining exploration company which has a diverse portfolio over multiple asset types, commodities and locations.

During the period its efforts have been focused on the early exploration of its gold, nickel and lithium projects in Western Australia.

However of most interest was the work that has been carried on its substantial Iron Ore Projects in the Yilgran Region of Australia, which have Mineral Resources comprised of Indicated Mineral Resources of approximately 54.5 Mt @ 47.2% Fe and approximately 26Mt @ 45.4% Fe Inferred resources.

Subsequent to the year-end Macarthur entered into an exclusive advisory agreement with UK based Capstan Capital Partners LLP (“Capstan”) to seek the necessary funding required to advance Macarthur’s significant iron ore projects located in Western Australia.

Macarthur has been reviewing its iron ore projects in light of the emergence of rail and port capacity through to the Port of Esperance and the cessation of mining at Cleveland-Cliffs Inc’s Asia Pacific Iron Ore projects and Mineral Resources Limited’s Carina project. 

Clancy Exploration (“Clancy”)

At the end of the period, Cadence held 4.5% interest in Clancy, which focused its efforts during the period in acquiring and developing 100% of key cobalt licenses adjacent to the Bou Azzer Cobalt mine in Morocco, which is famous for being a primary cobalt producer. Initial surface sampling has been carried out, and due diligence has been completed. The acquisition is in the process of completion, and we await further news in this regard.

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 (“Yangibana North Project”) 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.

Hastings Technology Metals Ltd (“Hastings”), which is the operator of the Project and the owner of the remaining 70% in the Yangibana North Project, made considerable progress during the year to date. This included securing funding for the initial long lead items for the project and securing an offtake of Memorandum of Understanding with Tyssenkrupp Raw Materials GmbH.

During the period we engaged with the management of Hastings, to discuss and review the reasoning why our joint venture areas are not included in the current mining plans. In conclusion, although mineral resources are substantial, using the currently envisaged beneficiation and hydrometallurgical process, the higher grade in the joint venture areas is offset by the higher processing costs associated with the ore. Therefore, Hastings envision that the ore will be included in the later stages of the mining plan, which is out of the scope of the feasibility study. In this regard, we view that our priority should be to look to extract value from the asset in the short to medium term.

FINANCIAL REVIEW

During the period, the Group made a loss before taxation of £4.60 million (30 June 2017: profit of £0.89 million; year ended 31 December 2017: profit £1.19 million). This was primarily due to a decrease in market price of our investments in Bacanora, following the overall trend in the market within lithium stocks.

There was a weighted basic loss per share of 0.058p (30 June 2017: profit per share 0.011p, 31 December 2016: profit per share 0.015p).  Foreign currency translation differences marginally increased comprehensive loss for the period to £4.66 million (30 June 2017: total comprehensive income of £0.84 million, 31 December 2016: total comprehensive expenditure of £1.88 million).

Administrative expenses decreased by £0.33 million compared to the same period last year; this decrease was driven by cost-cutting measures across the board inclusive of an average 30% reduction in directors salaries, which took effect in April this year. We continue to reduce costs and expect this downward trend in costs for the remainder of this financial year.

The total assets of the group decreased from £35.17 million at 31 December 2017 to £25.41 million. Of this amount, £9.95 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 decrease in 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 £12.9 million. EMH is classified as such because we hold in excess of 19% and Kiran Morzaria, the Chief Executive Office of Cadence is also a Non-Executive Director of EMH.

Our borrowings of £4.18 million as at the 31 December 2017 reduced to £3.06 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 £0.45 million compared to £1.46 million during the same period last year. The variance is attributable to the decreased administrative expenses as highlighted above. We invested a further £0.47 million in blue-chip liquid stocks in the lithium sector. We disposed of £0.44 million some of which included the aforementioned lithium stocks as well as some Bacanora equity, which taken together provided a £0.10 million realised profit on disposal. We also paid back some £1.12 million of our convertible loan during the period, which was the primary driver in reducing our cash position to £0.2 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

Hannam & Partners LLP (Joint Broker)

+44 (0) 207 907 8500

Neil Passmore

Giles Fitzpatrick

Novum Securities Limited (Joint Broker)

+44 (0) 207 399 9400

Jon Belliss

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 PLC

STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 30 JUNE 2018

 

Notes

Unaudited Period ended 30 June 2018

Unaudited Period ended 30 June 2017

Audited Year ended 31 December 2017

£’000

£’000

£’000

Income

Unrealised (loss)/profit on available for sale assets

(3,730)

2,331

1,353

Realised profit on available for sale assets

105

2

3,118

Other income

48

60

145

(3,577)

2,393

4,616

Share based payments

(3)

(2)

Impairment of intangible assets

(300)

Other administrative expenses

(785)

(1,123)

(1,800)

Total administrative expenses

(788)

(1,123)

(2,102)

Operating (loss)/profit

(4,365)

1,270

2,514

Share of associates losses

(182)

(103)

(339)

Finance cost

(59)

(272)

(986)

(Loss)/profit before taxation

(4,606)

895

1,189

 

 

 

Taxation

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

(4,606)

895

1,189

Other comprehensive (expenditure)/income

Foreign currency translation differences

(53)

(53)

686

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

(53)

(53)

686

Total comprehensive income/(expenditure) for the period

(4,659)

842

1,875

(Loss)/Profit per share

Basic (pence per share)

3

(0.0587)

0.0115

0.0152

Diluted (pence per share)

3

(0.0506)

0.0095

0.0125

CADENCE MINERALS PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 JUNE 2018

 

Share capital

Share premium account (restated)

Share-based payment reserve

Hedging, Loan & Exchange reserves

Retained earnings

Total equity

£’000

£’000

£’000

£’000

£’000

£’000

Balance at 1 January 2017

1,192

27,145

4,410

(254)

(7,968)

24,525

Issue of share capital

2

157

159

Transfer on lapse of warrants

(396)

396

On settlement of loan notes

(33)

(33)

Transactions with owners

               2

             157

–         396

–              33

          396  

          126

Foreign exchange

 –

 –

553

 –

553

Profit for the period

895

895

Total comprehensive income for the period

              –  

                –  

              –  

553

895

1,448

Balance at 30 June 2017 (unaudited)

1,194

27,302

4,014

266

(6,677)

26,099

Issue of share capital

8

250

258

Share based payments

2

2

Transfer on lapse of warrants

(285)

285

Transfer on cancellation of options

(553)

553

On issue of loan notes

412

412

On settlement of loan notes

(474)

(474)

Transactions with owners

               8

             250

–         836

(62)

          838

          198

Foreign exchange

133

133

Profit for the period

294

294

Total comprehensive income for the period

              –  

                –  

              –  

133

294

427

Balance at 31 December 2017

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)

On conversion of loan notes

 –

 –

 –

 –

Loss 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

 

CADENCE MINERALS PLC

STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2018

 

Unaudited

Unaudited

Audited

 30 June 2018

 30 June 2017

31 December 2017

Assets

Notes

£’000

£’000

£’000

Non-current

Intangible assets

1,875

2,228

1,887

Tangible assets

Investment in associate

12,918

12,879

12,988

14,793

15,107

14,875

Current assets

Trade and other receivables

461

421

722

Available for sale asset

9,946

18,498

13,534

Cash and cash equivalents

216

2,125

2,037

Total current assets

10,623

21,044

16,293

Total assets

25,416

36,151

31,168

EQUITY AND LIABILITIES

Current liabilities

Trade and other payables

290

227

262

Borrowings

3,058

9,825

4,182

Total current liabilities and total liabilities

3,348

10,052

4,444

Equity

Share capital

4

1,202

1,194

1,202

Share premium

27,552

27,302

27,552

Share based payment reserve

3,049

4,014

3,178

Hedging & Exchange reserve

284

266

337

Retained earnings

(10,019)

(6,677)

(5,545)

Total equity and liabilities

to owners of the company

22,068

26,099

26,724

Total equity and liabilities

25,416

36,151

31,168

CADENCE MINERALS PLC

CONSOLIDATED CASH FLOW STATEMENT

FOR THE PERIOD 30 JUNE 2018

Unaudited Period ended

Unaudited Period ended

Audited Year ended

30 June 2018

30 June 2017

31 December 2017

£’000

£’000

£’000

Cash flows from operating activities

Operating (loss)/profit

(4,365)

1,270

2,514

Net realised/unrealised (loss)/profit on AFSA

3,625

(2,333)

(4,471)

Impairment of intangible assets

300

Equity settled share-based payments

3

2

Decrease/(increase) in trade and other receivables

261

(19)

(320)

Increase/(decrease) in trade and other payables

28

(376)

(83)

Net cash outflow from operating activities

(448)

(1,458)

(2,058)

Taxation

Cash flows from investing activities

Payments for investments in AFS assets

(476)

(214)

(214)

Receipts on sale of AFS assets

438

16

7,118

Payments for investments in associates

(345)

Investment in exploration costs

(100)

(312)

(270)

Net cash outflow from investing activities

(138)

(510)

6,289

Cash flows from financing activities

Net (loan repayments)/borrowings

(1,176)

(5,400)

Finance cost

(59)

(99)

(986)

Net cash inflow from financing activities

(1,235)

(99)

(6,386)

Net (decrease)/increase in cash and cash equivalents

(1,821)

(2,067)

(2,155)

Cash and cash equivalents at beginning of period

2,037

4,192

4,192

Cash and cash equivalents at end of period

216

2,125

2,037

 

NOTES TO THE INTERIM REPORT

FOR THE PERIOD ENDED 30 JUNE 201

 

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 2017 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 2017 financial statements, which are prepared in accordance with International Financial Reporting Standards (IFRSs), as adopted by the European Union.   

GOING CONCERN 

The Directors have prepared cash flow forecasts for the period ending 30 September 2018. 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)/profit per share is based on the (loss)/profit 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 2018

30 June 2017

31 December 2017

£’000

£’000

£’000

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

(4,606)

895

1,189

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

  7,851,440,338

  7,773,489,131

  7,811,370,698

Share options and warrants exercisable

  1,259,575,345

  1,689,215,294

  1,664,564,973

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

  9,111,015,683

  9,462,704,425

  9,475,935,671

Basic and diluted (loss)/profit per share (pence)

(0.0587)

0.0115

0.0152

Diluted (loss)/profit per share (pence)

(0.0506)

0.0095

0.0125

 

 

4 SHARE CAPITAL

 

Unaudited

Unaudited

Audited

30 June 2018

30 June 2017

31 December 2017

£’000

£’000

£’000

Allotted, issued and fully paid

173,619,050 deferred shares of 0.24p (30 June and 31 December 2017: 173,619,050)

417

417

417

7,851,440,338 ordinary shares of 0.01p (30 June 2017: 7,777,690,338, 31 December 2017: 7,851,440,338)

                      785

                      777

                      785

                  1,202

                  1,194

                  1,202

 

Hannam & Partners – Cadence Minerals #KDNC – Updating valuation as portfolio climbs the development curve

Cadence Minerals – Updating valuation as portfolio climbs the development curve

Portfolio Progressing Towards Value Creation

Cadence is an investment company with a focus on lithium and other new technology metals. Cadence’s strategy in a crowded space is to gain exposure to projects which have strategic cost advantages and can be rapidly moved up the development value curve. Cadence’s core holdings are: a 20.4% stake in European Metal Holdings (AIM:EMH), which operates the Cinovec lithium/tin project in the Czech Republic; a 7% stake in Bacanora Lithium (AIM:BCN), which operates the Sonora Lithium project in Mexico; and a 30% interest in the Yangibana Rare Earth Project, located in Western Australia, with the remaining 70% held by ASX-listed Hastings Technology Metals Limited (ASX:HAS). In the last 6 months, Cadence’s portfolio projects have seen a number of significant developments, as they move towards production and value creation for shareholders.

Core projects getting closer to production

Q4 2017 saw the completion of bankable feasibility studies (BFS) at both the Sonora and Yangibana projects. The Sonora BFS showed a two-stage project with an up front capital cost of US$420m and a post-tax IRR of 21.2% at a Lithium Carbonate price of $11,000/tonne, while the Yangibana BFS outlined a capital cost of US$260m and an impressive IRR of 78%. Industry groups have shown support for both projects through off-take agreements and equity investments in the case of Sonora. Cinovec is currently moving towards completion of a BFS, with a particular focus on the metallurgical optimisation program, which has so far showed significantly improved lithium leaching recoveries with a small increase in roasting temperatures.

Next Steps / Catalysts – projects moving closer to production

Sonora and Yangibana are currently at similar stage of development, preparing for construction financing. In our view, news of such financing is likely to act as a catalyst for share price re-rating of Cadence Minerals as well as the project operators, Bacanora and Hastings Technology Metals. The BFS underway at the earlier stage Cinovec project, operated by European Metal Holdings, is expected to be completed in H2 2018. With potential cost savings from processing flowsheet optimisation, there is scope to improve on the economics of the project’s pre-feasibility study, which could act as another catalyst for Cadence shares, in our view.

Valuation

We update our Cadence valuation for the Sonora BFS results, our updated lithium price deck and updated implied valuations for public market holdings in the Cadence portfolio. We arrive at a sum of the parts valuation for Cadence’s assets of US$169.1m. Applying our NPV multiples to the Company’s operations we generate a valuation of GBp 0.87/sh, implying 277% upside to the current price.

Link here to view the full Hannam & Partners article

Cadence Minerals #KDNC – Corporate & Investment Update

Cadence Minerals (AIM/NEX: #KDNC; OTC: KDNCY) is pleased to update its shareholders in relation its strategic shift as announced 1 November 2017 and developments in its other investments.

New Investments

As outlined in Cadence’s announcement on 1 November 2017, the Company was at the advanced stages of reviewing several early stage lithium assets in well-known lithium jurisdictions.

The Company has now completed due diligence on two of these assets and anticipates that it will be able to execute binding investment agreements prior to the end of the year with exploration beginning in earnest in Q1 next year.

The Company’s intent is to earn in at a project level basis where it can both hold larger stakes and utilise its management expertise to achieve the high level of returns that we have made on our portfolio to date.

The Company will announce details of the assets and terms of the transactions once it has executed the binding investment agreements.

European Metals Holdings Limited – Equity Raise

European Metals Holdings Limited #EMH has announced a capital raising of £2,281,000 via subscriptions to predominantly UK based professional investors.

The funds will be used to advance the on-going definitive feasibility on the Cinovec deposit, Europe’s largest lithium resource, and for general working capital.

Cadence has subscribed for £345,000 of new ordinary shares and after the issue of these shares, which is expected to occur on the 14 December 2017, Cadence will hold approximately 20% of the enlarged issued share capital of EMH. Cadence’s overall unrealised return on its investment in EMH is 208%.

Macarthur Minerals – Majority of Tenements in Pilbara Region Granted Exploration Licences 

Macarthur Minerals has announced that eleven out of its sixteen Exploration Licences in the Pilbara, Western Australia, covering circa 1,300 km2 have now been granted allowing full exploration activities on those tenements for conglomerate gold, gold and lithium. The remaining licences are expected to be granted shortly.

Cadence has a 15.2% equity interest in Macarthur, which is an Australian mining exploration company focused primarily on lithium, iron ore and gold in the Pilbara region of Western Australia. It also has a lithium project in Nevada, USA.

Yangibana Rare Earth Project – Update

Cadence announced on 22 November 2017 an updated Mineral Resource Statement (“MRE”) for the tenements 30%-owned by Cadence on the Yangibana Rare Earth Project. This MRE represented 36% of the total MRE over the Yangibana Rare Earth Project including areas 100% held by Hastings Technology Metals #HAS.

Total Resource in Tenements 30% held by Cadence

Category

Tonnes

Nd2O3+Pr6O11

TREO

Nd2O3

Pr6O11

Dy2O3

Tb4O7

%

%

ppm

ppm

ppm

ppm

Measured

             900,000

0.43

1.64

3,258

997

42.8

17.55

Indicated

         2,100,000

0.46

1.76

3,507

1,061

45.1

17.39

Meas + Ind

         2,900,000

0.45

1.72

3,433

1,042

44.4

17.44

Inferred

         2,700,000

0.37

1.42

2,806

860

39.6

14.17

TOTAL

         5,600,000

0.41

1.58

3,134

955

42.1

15.88

Note: Rounding errors may occur

The MRE on our partly owned tenements has similar grades to those reported in the total MRE.

Subsequently HAS announced its definitive feasibility study (“DFS”), which was based on mining ore reserves of 5.15 million tonnes for 6 years followed by a further 2 years of mining mineral resources. The DFS contemplates mining in areas wholly owned by HAS.

Given the summary economic information on capital and operating costs, the 5.6 million tonnes of total resource contained with the jointly owned areas, we believe still represents significant value to Cadence. We have engaged with HAS to determine how this can be achieved.

Details of Ownership of Yangibana Rare Earth Deposit

On 1 December 2011, Cadence announced that it had acquired a 30% free carried interest to Bankable Feasibility Study of the Yangibana North Rare Earth Deposit. The exploration costs until the commencement of the BFS are therefore borne solely by Hastings (70% owners and operator). The same terms agreed and announced on 1 December 2012 also apply to Gossan, Hook, Kanes Gossan, Lions Ear and Bald Hill North.

Since the acquisition of this asset Cadence has not been required to invest any further capital in the development of the jointly owned tenements.

– Ends –

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

Hannam & Partners LLP (Joint Broker)

+44 (0) 207 907 8500

Neil Passmore

Giles Fitzpatrick

Square1 Consulting

+44 (0) 207 929 5599

David Bick

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.

About Cadence Minerals:

Cadence is dedicated to smart investments for a greener world. The planet needs rechargeable batteries on a global scale – upcoming supersized passenger vehicles, lorries and buses – require lithium and other technology minerals to power their cells. Cadence is helping find these minerals in new places and extracting them in new ways, which will meet the demand of this burgeoning market. With over £25 million vested in key assets globally, Cadence is helping us reach tomorrow, today.

Cadence invests across the globe, principally in lithium mining projects. Its primary strategy is taking significant economic stakes in upstream exploration and development assets within strategic metals. We identify assets that have strategic cost advantages that are not replicable, with the aim of achieving lower quartile production costs. The combination of this approach and seeking value opportunities allows us to identify projects capable of achieving high rates of return.

The Cadence board has a blend of mining, commodity investing, fund management and deal structuring knowledge and experience, that is supported by access to key marketing, political and industry contacts. These resources are leveraged not only in our investment decisions but also in continuing support of our investments, whether it be increasing market awareness of an asset, or advising on product mix or path to production. Cadence Mineral’s goal is to assist management to rapidly develop the project up the value curve and deliver excellent returns on its investments.

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