Blencowe Resources #BRES – Half-year Report

2nd June 2023 / Leave a comment

The Company is pleased to announce its Interim Results for the six-month period to 31 March 2023.

Electronic copies of the report will be available at the Company’s website www.blencoweresourcesplc.com

For further information please contact:

Blencowe Resources

Sam Quinn

www.blencoweresourcesplc.com

Tel: +44 (0) 1624 681 250

info@blencoweresourcesplc.com

Investor Enquiries

Sasha Sethi

Tel: +44 (0) 7891 677 441

sasha@flowcomms.com

Tavira Securities Limited

Jonathan Evans

Tel: +44 (0)203 192 1733

jonathan.evans@tavirasecurities.com

First Equity Limited

Jason Robertson

Tel: +44 (0)20 7330 1883

jasonrobertson@firstequitylimited.com

Interim Management Report

The period to 31 March 2023 (and subsequent events to 30 April 2023) have seen the Company continue to develop its Orom-Cross graphite project.

A Definitive Feasibility Study (“DFS”) commenced and is underway on a number of fronts; this is expected to take around 12 months to complete but the timing is dependent on pre-qualification test work being completed as a means to ultimately deliver binding offtake contracts for the full quantum of graphite concentrate being considered for sale under the phase one operational model. Experienced Australian engineering firm CPC Engineering have agreed to manage and sign off on the DFS, and their experience and involvement will assist greatly in achieving a high quality study and result.

DFS work will concentrate on three key areas. Firstly, work in-country to complete all work necessary to build and operate the mine, including all remaining licenses and permits. The associated infrastructure required to drive the operation will be scrutinised and plans put in place to ensure that all necessary infrastructure will be ready and in place for mining at Orom-Cross. Local studies include management and personnel, mining, equipment, logistics and other key areas. The DFS will take these studies to a far greater extent than the PFS in 2022.

Secondly, pre-qualification testing is taking place in the United States and China to advance the status of Orom-Cross graphite to potential buyers. A bulk sample of 100 tonnes was mined from Orom-Cross in January and (via a special export permit) was approved for transport to China by sea, where it will be put through an existing graphite pilot testing facility. This will save Blencowe substantial time and money by not having to build its own pilot facility on-site to get pre-qualified. The resultant tonnes of 96% concentrate will be then processed to a series of 99.9% products, both expendable’s (large flakes) and SPG (spheronised, purified graphite) (smaller flakes). Assuming successful these samples will be given to end user OEMs to conduct their own testing in their own facilities, to ensure Orom-Cross end product meets their standards and expectations. Once this process is completed then Orom-Cross becomes ‘qualified’ and offtake contract discussions may be entered into.

A 150kg sample was sent to China by air as a preliminary raw material product for the same pilot facility to run tests on how to achieve the best results on the larger sample to follow, and the Company expects feedback on this shortly. This full qualification process is what sets graphite apart from most other metals and it also creates barriers to entry for new participants in the industry. Blencowe is confident that it has the right process/procedures in place to achieve the results it requires to pass this key hurdle. Without binding offtake agreements, it will be difficult to deliver a decision to mine and/or project funding, so this is a critical path item within the DFS. In the past this process has taken other graphite companies several years, Blencowe is hoping that the refinement of this process via its advisors will ensure we ultimately complete this pre-qualification much faster.

In parallel Blencowe is conducting further metallurgical test work in USA to provide evidence (bench-scale testing) that the 96% concentrate it will deliver at Orom-Cross will be suitable for upgrading to the 99.9% end products sought after by the market, and how this us best achieved. These results are expected soon and will be important in ascertaining the end value within the project portfolio.

Thirdly, Blencowe is working through a number of different potential funding options to secure the right partnerships for funding both the DFS and the project implementation. There are different alternatives at both topco and project level and it is important that the right relationships are built that can deliver this project ahead, both now (DFS stage) and in building the full project. Blencowe announced in April its successful passing through a key screening hurdle/test with the Development Finance Corporation (DFC) which is a tier one US Govt-owned financial institution which provides funding solutions for the private sector in areas the US Govt deems are critical. Graphite is considered critical and hence the interaction. This is seen as a valuable relationship for Orom-Cross and the Company is hoping to sign off on a substantial technical assistance grant with the DFC in the near term that will provide up to 50% of the DFS costs. Thereafter this relationship has the potential to offer further funding solutions for the full project finance required. The credibility that association with an institution of this stature brings to both our Company and our project cannot be easily measured; this would be a big result for Blencowe.

These and other DFS activities are the focus and will remain so for the Company ahead. Further capital will be introduced into the Company as and when required, with the continued support of our major shareholders, and once Blencowe delivers the DFC technical assistance grant it is believed that many other funding opportunities will emerge at all levels.

Elsewhere, the Company walked away from the previously announced nickel exploration earn-in deal with SIPA Resources as it was considered more advantageous to concentrate on delivering the Orom-Cross graphite project into production ahead.

Mike Ralston

Chief Executive Officer

Responsibility Statement of the Directors in respect of the Interim Report

The Directors are responsible for preparing the Interim Financial Statements in accordance with applicable law and regulations. In addition, the Directors have elected to prepare the Interim Financial Statements in accordance with International Financial Reporting Standards (“IFRSs”), as adopted by the United Kingdom (“UK”).

The Interim Financial Statements are required to give a true and fair view of the state of affairs of the Group and of the profit or loss of the Group for that period.

In preparing these Interim Financial Statements, the Directors are required to:

· select suitable accounting policies and then apply them consistently;

· present information and make judgements that are reasonable, prudent and provides relevant, comparable and understandable information;

· provide additional disclosures when compliance with the specific requirements in IFRS is insufficient to enable users to understand the impact of particulars transactions, other events and conditions on the entity’s financial position and financial performance; and

· make an assessment of the Group’s ability to continue as a going concern.

The Directors are responsible for keeping proper accounting records that are sufficient to show and explain the Group’s transactions and disclose with reasonable accuracy at any time its financial position of the Group to enable them ensure that the financial statements comply with the requirements of the Companies Act 2006. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and Interim Financial Statements. Legislation governing the preparation and dissemination of Interim Financial Statements may differ from one jurisdiction to another.

We confirm that to the best of our knowledge:

· the Interim Financial Statements, prepared in accordance with International Financial Reporting Standards as adopted by the UK, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group for the period;

· the Director’s report includes a fair review of the development and performance of the business and the position of the group, together with a description of the principal risks and uncertainties that they face; and

· the annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the group’s performance, business model and strategy.

Consolidated Statement of Comprehensive Income for the six month period ended 31 March 2023

		6 months ended 31 Mar 2023	6 months ended 31 Mar 2022	12 months ended 30 Sep 2022
		(Unaudited)	(Unaudited)	(Audited)
	Notes	GBP	GBP	GBP

Exploration costs		(16,642)	(2,744)	(4,853)
Impairment -Akelikongo project		–	–	(404,533)
Administrative fees and other expenses	5	(446,424)	(331,617)	(681,488)
Adjustments to Liability to surface liability		–	–	51,316
Operating loss		(463,066)	(334,361)	(1,039,558)

Finance costs		(23,010)	(21,975)	(45,916)
Loss before tax		(486,076)	(356,336)	(1,085,474)

Income tax		–	–	–

Loss after tax		(486,076)	(356,336)	(1,085,474)

Other comprehensive income
Exchange differences on translation of foreign operation		7,807	(2,061)	(4,205)
Other comprehensive income, net of tax		7,807	(2,061)	(4,205)

Total comprehensive loss		(478,269)	(358,397)	(1,089,679)

Basic and diluted loss per share (pence)	9	(0.28)	(0.27)	(0.68)

There was no other comprehensive income for the period ended on 31 March 2023.

Consolidated Statement of Financial Position as at 31 March 2023

		As at 31 Mar 2023	As at 31 Mar 2022	As at 30 Sept 2022
		(Unaudited)	(Unaudited)	(Audited)
	Notes	GBP	GBP	GBP

Non-Current Assets		7,065,820	5,815,114	6,615,253

Current assets
Trade and other receivables	6	135,901	248,413	85,847
Cash and cash equivalents		130,740	968,693	346,994
Total current assets		266,641	1,217,106	432,841

Total assets		7,332,461	7,032,220	7,048,094

Current liabilities
Creditors: Amounts falling due within one year		(429,843)	(282,217)	(326,375)
Total current liabilities		(429,843)	(282,217)	(326,375)

Non-current liabilities
Surface liabilities		(785,520)	(924,359)	(825,852)

Total liabilities		(1,215,363)	(1,206,576)	(1,152,227)

Net assets		6,117,098	5,825,644	5,897,867

Equity
Share capital		1,931,316	1,101,316	1,181,316
Share premium		7,428,329	6,841,596	7,480,829
Warrants reserves		402,148	317,876	402,148
Translation reserve		7,264	1,601	(543)
Retained earnings		(3,651,959)	(2,436,745)	(3,165,883)
Total equity		6,117,098	5,825,644	5,897,867

Consolidated Statement of Changes in Equity for the six month period ended 31 March 2023

	Share capital	Share premium	Share option reserves	Retained earnings	Translation reserve	Total equity
	GBP	GBP	GBP	GBP	GBP	GBP
Balance as at 30 Sep 2021	901,316	5,132,081	317,876	(2,080,409)	3,662	4,274,526

Total comprehensive loss for 6 months
Loss for the period	–	–	–	(356,336)	–	(356,336)
Total comprehensive loss	–	–	–	(356,336)	–	(356,336)
Contributions from equity holders
New shares issued	200,000	1,800,000	–	–	–	2,000,000
Share issue costs	–	(90,485)	–	–	–	(90,485)
Exchange differences on translation	–	–	–	–	(2,061)	(2,061)
Total contributions from equity holders	200,000	1,709,515	–	–	(2,061)	1,907,454

Balance as at 31 Mar 2022	1,101,316	6,841,596	317,876	(2,436,745)	1,601	5,825,644

Total comprehensive loss for 6 months
Loss for the period	–	–	–	(729,138)	–	(729,138)
Total comprehensive loss	–	–	–	(729,138)	–	(729,138)
Contributions from equity holders
New shares issued	80,000	720,000	–	–	–	800,000
Share issue costs	–	(80,767)	–	–	–	(80,767)
Warrants reserve			84,272	–	–	84,272
Exchange differences on translation of foreign operations	–	–	–	–	(2,144)	(2,144)
Total contributions from equity holders	80,000	639,233	84,272	(729,138)	(2,144)	801,361

Balance as at 30 Sep 2022	1,181,316	7,480,829	402,148	(3,165,883)	(543)	5,897,867

Consolidated Statement of Changes in Equity for the six month period ended 31 March 2023

	Share capital	Share premium	Share option reserves	Retained earnings	Translation reserve	Total equity
	GBP	GBP	GBP	GBP	GBP	GBP
Balance as at 30 Sep 2022	1,181,316	7,480,829	402,148	(3,165,883)	(543)	5,897,867

Total comprehensive loss for 6 months
Loss for the period	–	–	–	(486,076)	–	(486,076)
Total comprehensive loss	–	–	–	(486,076)	–	(486,076)
Contributions from equity holders
New shares issued	750,000	–	–	–	–	750,000
Share issued costs	–	(52,500)	–	–	–	(52,500)
Exchange differences on translation of foreign operations	–	–	–	–	7,807	7,807
Total contributions from equity holders	750,000	(52,500)	–	–	7,807	705,307

Balance as at 31 Mar 2023	1,931,316	7,428,329	402,148	(3,651,959)	7,264	6,117,098

Consolidated Statement of Cash Flows for the six month period ended 31 March 2023

		As at 31 Mar 2023	As at 31 Mar 2022	As at 30 Sept 2022
		(Unaudited)	(Unaudited)	(Audited)
	Notes	GBP	GBP	GBP
Operating activities
Loss after tax		(486,076)	(356,336)	(1,085,474)
Depreciation		104	–	–
Finance costs		23,010	21,974	45,916
Adjustment to Surface Liability		–	–	(51,316)
Share issue/warrant cost		–	–	84,272
Impairment – Akelikongo costs		–	–	404,533
Unrealised currency translation		261,566	(61,217)	(208,371)
Changes in working capital
Decrease/(increase) in trade and other receivables		(50,054)	(195,833)	(33,267)
Increase/(decrease) in trade and other payables		(39,568)	38,945	76,483
Net cash flows from operating activities		(291,018)	(552,467)	(767,224)

Cash flows from financing activities
Purchase of fixed assets		(748)	–	–
Investment in exploration assets		(621,988)	(481,643)	(1,423,236)
Net cash flows from investment activities		(622,736)	(481,643)	(1,423,236)

Financing activities
Shares issued		750,000	2,000,000	–
Shares issued (cost)		(52,500)	(90,486)	2,444,166
Net cash flows from financing activities		697,500	1,909,514	2,444,166

Increase in cash and short-term deposits		(216,254)	875,404	253,706

Cash and short-term deposits brought forward		346,994	93,288	93,288

Cash and cash equivalents at end of period		130,740	968,692	346,994

Notes to the Financial Statements for the six month period ended 31 March 2023

1. General

Blencowe Resources Plc (the “Company”) is a public limited company incorporated and registered in England and Wales on 18 September 2017 with registered company number 10966847 and its registered office situated in England and Wales at 167-169 Great Portland Street, Fifth Floor, London, England W1W 5PF.

The Group did not earn any trading income during the period under review but incurred expenditure in developing its principal assets.

The Consolidated Interim Financial Statements of the Company for the six month period ended 31 March 2023 comprise the financial statements of the Company and its subsidiaries (together referred to as the “Group”).

2. Accounting Policies

Basis of preparation

The Interim Financial Statements of the Group are unaudited condensed financial statements for the six month period ended 31 March 2023.

The accounting policies applied by the Group in these Interim Financial Statements, are the same as those applied by the Group in its consolidated financial statements and have been prepared on the basis of the accounting policies applied for the financial year to 30 September 2022 which have been prepared in accordance with IFRS as adopted by UK for. The Group Financial Statements have been prepared using the measurement bases specified by IFRS each type of asset, liability, income and expense.

The Group Financial Statements are presented in £, which is the Group’s functional currency. All amounts have been rounded to the nearest pound, unless otherwise stated.

Comparative figures

The comparative figures have been presented as the Group Financial Statements cover the 6 month period ended 31 March 2022 and the 12 month period ended 30 September 2022.

3. Critical accounting estimates and judgments

In preparing the Group’s Interim Financial Statements, the Directors have to make judgments on how to apply the Group’s accounting policies and make estimates about the future. The Directors do not consider there to be any critical judgments that have been made in arriving at the amounts recognised in the Group Financial Statements.

4. Significant accounting policies

The accounting policies adopted are consistent with those followed in the preparation of the annual financial statements of Blencowe Resources Plc for the year ended 30 September 2022. A copy of these financial statements is available on the Group website at https://blencoweresourcesplc.com/

5. Administrative fee and other expenses

	6 months ended 31 Mar 2023	6 months ended 31 Mar 2022	12 Months ended 30 Sep 2022
	(Unaudited)	(Unaudited)	(Audited)
	GBP	GBP	GBP
Directors’ remuneration	70,023	70,046	173,413
Professional fees	121,692	130,655	274,333
Salaries	75,000	60,000	142,500
Listing fees	18,218	19,783	26,910
Audit fees	21,644	4,375	29,000
Share issue/warrant cost	–	–	84,272
Administration fees	23,500	23,500	47,000
Broker fees	20,500	29,542	38,048
Travelling expenses	7,959	–	34,167
Miscellaneous fees	87,888	(6,284)	(168,155)
Total	446,424	331,617	681,488

The Group had two employees who are key management personnel and three Directors. The Directors and the key management personnel’s remuneration related solely to short term employee benefits.

6. Trade and other receivables

	6 months ended 31 Mar 2023	6 months ended 31 Mar 2022	12 Months ended 30 Sep 2022
	(Unaudited)	(Unaudited)	(Audited)
	GBP	GBP	GBP
Other receivables	21,526	37,997	24,765
Prepayments	114,375	210,416	61,082
Total	135,901	248,413	85,847

7. Creditors: Amounts falling due within one year

	6 months ended 31 Mar 2023	6 months ended 31 Mar 2022	12 Months ended 30 Sep 2022
	(Unaudited)	(Unaudited)	(Audited)
	GBP	GBP	GBP
Payables	118,980	268,067	140,018
Land Owners Liability	143,036	–	154,403
Accruals and provision	167,827	14,150	31,954
Total	429,843	282,217	326,375

8. Creditors: Amounts falling after one year

BRUL, the Company’s subsidiary entered into an agreement for surface rights over the land in the mineral area of the licence. The land owners granted BRUL a 49 year lease over an area. The liability to the land owners is to be paid in 8 instalments on at defined dates with the final payment due in 2035.

	6 months ended 31 Mar 2023	6 months ended 31 Mar 2022	12 Months ended 30 Sep 2022
	(Unaudited)	(Unaudited)	(Audited)
	GBP	GBP	GBP
Total payable at the beginning of the period	978,255	887,560	887,560
Change in estimate	–	–	(51,316)
Interest charged during the period	23,010	21,975	45,916
Exchange loss on valuation	(72,709)	14,824	96,095
Total payable as at period end	928,556	924,359	978,255

Analysis between current and non-current liability
Payable within 12 months	143,036	–	154,403
Payable after 12 months	785,520	924,359	823,852
	928,556	924,359	978,255

The value of the lease is measured at the present value of the contractual payments due to the lessor

over the lease term, with the discount rate of 5%.

9. Loss per share

The calculation of the basic and diluted loss per share is based on the following data:

	6 months ended 31 Mar 2023	6 months ended 31 Mar 2022	12 Months ended 30 Sep 2022
	(Unaudited)	(Unaudited)	(Audited)
Earnings	GBP	GBP	GBP
Loss from continuing operations for the period attributable to the equity holders of the Group	(478,269)	(353,336)	(1,085,474)
Number of shares
Weighted average number of Ordinary Shares for the purpose of basic and diluted earnings per share
	168,803,923	133,655,997	160,790,224
Basic and diluted loss per share (pence)	(0.28)	(0.27)	(0.68)

There are no potentially dilutive shares in issue.

10. Related party transactions

The are no related party transactions during the period except for the Directors’ remuneration, which have been disclosed in note 5.

Sam Quinn is a director and shareholder of the Company and a Director of Lionshead Consultants Limited. During the period, Lionshead Consultants Limited charged fees for consultancy fees of £18,000 (31 March 2022: £12,000 and 30 Sep 2022: £24,000).

11. Events after the reporting date

On 27 April 2023, the Company announced that it has managed to secure a strategic funding partner for the Orom-cross graphite project. The Development Finance Corporation engaged to fund 50% of the definitive feasibility study costs by way of a technical assistant grant. The DFC is the primary US Government finance institution set up to provide financially sound solutions for private sector initiatives pertaining to critical challenges facing the world.

On 18 May 2023 Blencowe Resources Plc announced that it had raised £635,000 at 5 pence per share through the issue of 12,700,000 new ordinary shares of 0.5p placing shares. The Company will issue investors in the Placing with 1 warrant per 2 Placing Shares (Investor Warrants”) which are exercisable at 8p for a period of 3 years from Admission of the Placing Shares.

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END

#KAV Kavango Resources PLC – Annual Financial Report Published

28th April 2023 / Leave a comment

Kavango Resources plc (LSE:KAV) announces that the Annual Report and Accounts for the year ended 31 December 2022 is now available to download from the Company’s website:

http://www.kavangoresources.com/investor-relations/financial-reports

In accordance with DTR 6.3.5(1A), the unedited full text of the regulated information required to be made public under DTR 4.1 is contained within the 2022 Annual Report and Accounts which has been uploaded to the National Storage Mechanism and is available for inspection at:

https://data.fca.org.uk/#/nsm/nationalstoragemechanism

Further information in respect of Kavango and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.

For further information please contact:

Kavango Resources plc

Ben Turney

bturney@kavangoresources.com

First Equity (Broker)

+44 207 374 2212

Jason Robertson

#SVML Sovereign Metals LTD – March 2023 Quarterly Report

28th April 2023 / Leave a comment

Indicated Resource Increased by over 80%

· Kasiya’s Indicated Resource now stands at 1.2 Billion tonnes at 1.0% rutile and 1.5% graphite with over 66% of tonnes now in the Indicated category.

· Updated Mineral Resource Estimate (MRE) moves over 0.5 Billion tonnes from Inferred to Indicated – an increase of 81% to the Indicated category.

· The updated MRE will underpin the mining inventory and mine plan for the forthcoming PFS.

Kasiya’s Graphite Global Warming Potential to be Amongst the Lowest in the World

· Independent benchmarking indicates Sovereign’s graphite co-product from Kasiya has the lowest GWP compared with currently known and planned future natural graphite projects.

· Global warming potential (GWP) of producing one tonne of flake graphite concentrate at Kasiya estimated to be 0.2 tonnes of CO₂ equivalent emissions (CO₂e):

o 3x less polluting than proposed Tanzanian natural graphite production from hard rock sources.

o 6x less polluting than current Chinese natural graphite production which accounts for up to 80% of current global graphite supply.

Kasiya Rutile Project PFS in advanced stages

· Sovereign is in the advanced stages of the Pre-Feasibility Study (PFS) for the Kasiya Rutile Project (Kasiya), a potential industry-leading major source of critical raw materials from Malawi.

· The PFS will build on the Expanded Scoping Study (ESS) which confirmed Kasiya as one of the world’s largest and potentially lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than other current and planned producers.

· The PFS is progressing well and is expected to be completed in the coming months.

Sovereign Demerges Standalone Graphite Projects

· Sovereign has demerged its standalone Graphite Projects (Nanzeka, Malingunde, Duwi and Mabuwa Projects) into NGX Limited effective from 27 March 2023.

· The Demerger allows Sovereign and the existing management team to focus on its flagship Kasiya Project while retaining extensive exposure to graphite through the Kasiya co-product.

Classification: 3.1 Additional regulated information required to be disclosed under the laws of a Member State

ENQUIRIES

Dr Julian Stephens (Perth)
Managing Director

+61(8) 9322 6322

Sam Cordin (Perth)
+61(8) 9322 6322

Sapan Ghai (London)
+44 207 478 3900

Nominated Adviser on AIM
RFC Ambrian
Andrew Thomson	+61 8 9480 2500

Joint Brokers
Berenberg	+44 20 3207 7800
Matthew Armitt
Jennifer Lee

Optiva Securities	+44 20 3137 1902
Daniel Ingram
Mariela Jaho
Christian Dennis

KASIYA – THE LARGEST RUTILE DEPOSIT IN THE WORLD

Kasiya, located in central Malawi, is the largest natural rutile deposit and one of the largest flake graphite deposits in the world. Sovereign is aiming to develop an environmentally and sustainable operation to supply highly sought-after natural rutile and graphite to global markets.

The ESS confirmed Kasiya as potentially one of the world’s largest and lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than other existing and planned operations.

The Company is in the advanced stages of the PFS for Kasiya which will build on the on the ESS, with significant advancements made throughout the quarter. The Company expects to announce the outcomes of the PFS in the coming months.

INDICATED RESOURCE UPGRADE

In April 2023, Sovereign announced the updated MRE for its world-class Kasiya rutile-graphite deposit in Malawi. The updated MRE resulted in over 0.5 Billion tonnes converting from Inferred to Indicated, an 81% increase in the Indicated category. Kasiya now contains 1.2Bt @ 1.0% rutile and 1.5% graphite in the Indicated category and a total MRE of 1.8Bt @ 1.0% rutile and 1.4% graphite.

Kasiya remains the world’s largest natural rutile deposit and one of the largest flake graphite deposits.

Table 1: Kasiya Total Indicated + Inferred Mineral Resource Estimate at 0.7% rutile cut-off grade
Classification	Resource (Mt)	Rutile Grade (%)	Contained Rutile (Mt)	Graphite Grade (TGC) (%)	Contained Graphite (Mt)
Indicated	1,200	1.0%	12.2	1.5%	18.0
Inferred	609	0.9%	5.7	1.1%	6.5
Total	1,809	1.0%	17.9	1.4%	24.4

The updated MRE has further defined broad and contiguous zones of high-grade rutile and graphite which occur across a very large area of over 201km². Rutile mineralisation is concentrated in laterally extensive, near surface, flat “blanket” style bodies in areas where the weathering profile is preserved and not significantly eroded. Graphite is depleted near surface with grades improving at depths generally >4m to the base of the saprolite zone which averages about 22m.

Sovereign’s 2022 drill program at Kasiya used push tube (PT) core holes to in-fill and convert Inferred mineralisation into the Indicated category. The consistency and robustness of the geology allowed for an efficient conversion of this previously Inferred material on a near-identical one-for-one basis to the Indicated category.

A total of 66% of the MRE now reports to the Indicated category @ 1.0% rutile and 1.5% TGC – up from 33% previously. Overall, the new Indicated components show coherent, broad bodies of mineralisation that have coalesced well, particularly in the southern parts of the MRE.

Further advancement in this MRE update was the application of air-core (AC) drilling to define the depth of mineralisation in a number of selected higher-grade areas. As expected, this drilling shows that high-grade rutile and graphite mineralisation extends to the base of the soft saprolite unit terminating on the saprock basement averaging about 22m depth. This deeper AC drilling targeted early-scheduled mining pits mainly in the southern areas of the MRE footprint.

A number of higher-grade graphite zones at depth were identified which are generally associated with higher grade rutile at surface. Some of these zones have graphite grades at depths >6m in the 4% to 8% TGC range and represent significant contained coarse flake graphite tonnages.

The highlighted cut-off of 0.7% rutile presents 1.8 billion tonnes at a rutile grade of 1.0%. (Table 2). The overall recovered rutile equivalent grade for the MRE at the global 0.7% cut-off is 1.65% RutEq*.

Table 2: Kasiya Total Indicated + Inferred Mineral Resource Estimate at various rutile cut-off grades
Cut-off (rutile)	Resource (Mt)	Rutile Grade (%)	Contained Rutile (Mt)	Graphite Grade (%)	Contained Graphite (Mt)
0.40%	3,215	0.80%	25.7	1.30%	41.9
0.50%	2,779	0.85%	23.8	1.35%	37.4
0.60%	2,304	0.92%	21.1	1.37%	31.7
0.70%	1,809	0.99%	17.9	1.35%	24.4
0.80%	1,335	1.08%	14.4	1.25%	16.6
0.90%	934	1.17%	11.0	1.06%	9.9
1.00%	643	1.28%	8.2	0.84%	5.4
1.10%	449	1.38%	6.2	0.65%	2.9
1.20%	324	1.47%	4.7	0.53%	1.7
1.30%	230	1.56%	3.6	0.48%	1.1
1.40%	163	1.64%	2.7	0.45%	0.7

* RutEq. Formula: Rutile Grade x Recovery (98%) x Rutile Price (US$1,308/t) + Graphite Grade x Recovery (62%) x Graphite Price (US$1,085/t) / Rutile Price (US$1,308/t). All assumptions are taken from the Expanded Scoping Study (ESS) released June 2022

KASIYA’S GWP TO BE AMONGST THE LOWEST IN THE WORLD

Sovereign combined results of internal company analysis, supplemented with an independent benchmarking study by UK-based consultancy Minviro Ltd (Minviro) which compared the global warming potential (GWP) of producing natural flake graphite from the Kasiya against relevant current and future natural graphite projects.

The GWP of producing one tonne of flake graphite concentrate at Kasiya estimated to be 0.2 tonnes of CO₂ equivalent emissions (CO₂e). Kasiya has the lowest GWP compared with currently known and planned future natural graphite projects:

· Up to 60% lower than currently reported GWP of graphite producers and developers, including suppliers to Tesla Inc.

· 3x less polluting than proposed Tanzanian natural graphite production from hard rock sources.

· 6x less polluting than current Chinese natural graphite production which accounts for up to 80% of current global graphite supply.

The cradle-to-gate life cycle assessment (LCA) was carried out by Minviro comparing current natural graphite production from China which produces almost 80% of the world’s natural graphite, and proposed near-term production from Tanzania, which offers a regional benchmark against Kasiya in Malawi. The LCA study followed ISO 14067:2008 guidelines and was critically reviewed by a panel of three independent experts.

A number of graphite producers and explorers/developers have conducted their own LCAs, with conclusions of a select number being made public. Kasiya’s graphite product currently has the lowest GWP of publicly reported current and future potential graphite production.

The benchmarking study found that the total GWP of 0.2 tonnes CO₂e per tonne of natural flake graphite concentrate produced at Kasiya is significantly lower than the total GWP per tonne produced in Heilongjiang Province, China (1.2 tonnes CO₂e) and the total GWP per tonne produced in Tanzania (0.6 tonnes CO₂e).

Why is Kasiya’s Graphite able to achieve such a low carbon-footprint?

The GWP for Kasiya’s flake graphite product was based on the ESS. The significantly lower GWP for Kasiya graphite is due to the fact that it is hosted in soft, friable saprolite material which will be mined via hydro methods (high pressure water monitors) powered by predominantly renewable energy sources – hydro power from the Malawi grid and on-site solar power. This is opposed to the production in Heilongjiang Province, China where hard-rock ore requires drilling, blasting, excavation, trucking, crushing, and grinding – overall high CO₂e activities.

Link here to view the full report

#POW Power Metal Resources PLC – Victoria Goldfields Australia – Drilling Update

15th March 2023 / Leave a comment

Drilling Programme Complete; Visible Gold Intersected in 4 of 6 Holes and Significant Quartz Vein Intercept in the Final Hole

Power Metal Resources PLC (LON:POW), the London listed exploration company seeking large-scale metal discoveries across its global project portfolio announces an exploration update from the Company’s Berringa Gold Mine Project (“Berringa” or the “Project”), which forms part of the Victorian Goldfields joint-venture (“JV”) located in Victoria, Australia.

A progress update RNS was announced on 16 February 2023 which announced the completion of three diamond drill holes, with all holes completed thus far encountering visible gold:

https://www.londonstockexchange.com/news-article/POW/victoria-goldfields-australia-update/15840466

BACKGROUND:

– The diamond drill programme was designed to test three priority targets at Berringa which is a former high-grade producing gold mine in the Victoria Goldfields. The programme began in December 2022 and is now complete.

– The programme aimed to test for the down dip and along strike extensions of previously mined gold mineralised zones and to improve the structural understanding of the deposit area.

HIGHLIGHTS:

– The drilling has now completed, with a total of six diamond drillholes totalling 988 metres.

– The majority of drill core samples are currently undergoing assay testing at an accredited laboratory in Ballarat. The remaining samples will be delivered to the laboratory within the week with final results expected later this month.

– Four of the six drill holes completed as part of this programme encountered visible gold. (BED23001, BED23002, BED23003, BED23006). Mineralised intercepts in drillholes BED23001, BED23002 and BED23003 are summarised in the 16 February 2023 release.

– In the final hole drilled, BED23006, visible gold was encountered at 133.55m within a broader circa 30-metre-wide quartz vein (130.5m – 158m) which is located approximately 100 metres east of the main Berringa line of workings. This represents a significantly large quartz vein intercept, and it indicates the likely existence of the eastern and parallel trend of gold mineralisation.

– Within the final drill hole, due to ground conditions, drilling was terminated at 158m whilst still in the quartz veining meaning the 30-metre-wide intersection remains open downhole.

Sean Wade, Chief Executive Officer of Power Metal Resources Plc commented:

“I am delighted to confirm that drilling is now complete at Berringa. Importantly, 4 of 6 drill holes encountered visible gold including a significant 30-metre-wide mineralised quartz vein in the final hole completed – which remains open downhole.

It is also worth noting that at both Berringa as well as our 100%-owned Tati gold Project located in Botswana, exploration is centred on extensions of previously producing gold mines. These therefore are brownfield and not greenfield targets, representing more advanced exploration opportunities than currently being recognised.

I want to personally thank our in-country exploration and drilling teams for their hard work in completing this drilling programme, and we now eagerly await final assay results.”

JOINT VENTURE STRUCTURE

The JV is held between Power Metal (49.9%) and its partner, London-listed Red Rock Resources PLC (50.1%) (together the “JV Partners”).

NBGC has a wholly owned Australian operating subsidiary Red Rock Australasia Pty Ltd (“RRAL”) which holds a strong land position comprising seventeen granted exploration licences and one purchased licence for a total area of 1,867km² within the prolific Victorian Goldfields of Victoria, Australia, principally surrounding the mining centre of Ballarat, Australia.

In addition, 2 licences covering 467km² await grant. The JV has carefully assembled its portfolio of properties comprising a broad range from robust exploration targets to near term resource potential, all of which remain largely underexplored by modern explorers.

The JV Partners have the intention of listing the JV company NBGC and will make further announcements as appropriate.

QUALIFIED PERSON STATEMENT

The technical information in this report is compiled by David Holden, BSc, MBA, MEM, who is a member of the Australian Institute of Geoscientists and the Executive Officer and Exploration Manager of RRAL. He is a member of a recognised professional organisation and has sufficient relevant experience to qualify as a qualified person as defined in the Guidance Note for Mining, Oil and Gas Companies, published by AIM.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (“MAR”), and is disclosed in accordance with the Company’s obligations under Article 17 of MAR.

For further information please visit https://www.powermetalresources.com/ or contact:

Power Metal Resources plc
Sean Wade (Chief Executive Officer)	+44 (0) 20 3778 1396

SP Angel Corporate Finance (Nomad and Joint Broker)
Ewan Leggat/Charlie Bouverat	+44 (0) 20 3470 0470

SI Capital Limited (Joint Broker)
Nick Emerson	+44 (0) 1483 413 500

First Equity Limited (Joint Broker)
David Cockbill/Jason Robertson	+44 (0) 20 7330 1883

#GRX GreenX Metals – Half-year Report

15th March 2023 / Leave a comment

DIRECTORS REPORT

The Directors of GreenX Metals Limited present their report on the Consolidated Entity consisting of GreenX Metals Limited (Company or GreenX) and the entities it controlled during the half-year ended 31 December 2022 (Consolidated Entity or Group).

DIRECTORS

The names and details of the Company’s Directors in office at any time during the half-year and until the date of this report are:

Directors:

Mr Ian Middlemas Chairman
Mr Benjamin Stoikovich Director and CEO

Mr Garry Hemming Non-Executive Director
Mr Mark Pearce Non-Executive Director

Unless otherwise shown, all Directors were in office from the beginning of the half-year until the date of this report.

OPERATING AND FINANCIAL REVIEW

Operations

Highlights during, and subsequent to, the half-year include:

· During the period, the hearing for the international arbitration claims against the Republic of Poland under both the Energy Charter Treaty and the Australia-Poland Bilateral Investment Treaty was concluded.

➢ Combined arbitration hearing took place in front of the Arbitral Tribunal in London under the UNCITRAL Arbitration Rules for GreenX’s claims against Poland.

➢ Damages of up to £737 million (A$1.3 billion / PLN4.0 billion) have been claimed including the assessed value of GreenX’s lost profits and damages related to both the Jan Karski and Debiensko projects, and accrued interest related to any damages.

➢ The Company has funded the Claim proceedings under its US$12.3 million Litigation Funding Agreement (LFA).

· In November 2022, the Company announced highly encouraging results from an initial site visit to Arctic Rift Copper Project (ARC or Project).

➢ Analysis of the site visit results is underway and will be key to future work programs.

➢ GreenX can earn up to 80% of the ARC copper project in Greenland. ARC is a significant, large-scale project (5,774km² license area) with historical exploration results and recent analysis indicative of an extensive mineral system with potential to host world-class copper deposits.

· Subsequent to the half year, the Company announced a placing to issue 12.4 million new ordinary shares to raise gross proceeds of approximately £3.9 million (~A$6.8 million) from new and existing UK and European investors and some Australian investors (Placing). Due to high demand, directors resolved to increase the Placing to issue 14.1 million new ordinary shares to raise total gross proceeds of approximately £4.4 million (~A$7.7 million). The Placing shares were issued on 14 March 2023.

· On completion of the Placing, the Company will have cash reserves of A$10 million.

Dispute with the Polish Government

During the period, the Company reported the conclusion of the hearing for the international arbitration claims (Claim) against the Republic of Poland under both the Energy Charter Treaty (ECT) and the Australia-Poland Bilateral Investment Treaty (BIT) (together the Treaties). The hearing took place in London in November 2022 and lasted two weeks.

Following completion of the hearing, the Arbitral Tribunal will render an Award (i.e., the legal term used for a ‘decision’ by the Tribunal) in due course with no specified date available for the Tribunal decision.

As previously advised, the arbitration and hearing proceedings in relation to the Claim are required to be kept confidential.

Details of the Claim

The Company’s Claim against the Republic of Poland is being prosecuted through an established and enforceable legal framework, with GreenX and Poland agreeing to apply the United Nations Commission on International Trade Law Rules (UNCITRAL) to the proceedings. The arbitration claims are being administered through the Permanent Court of Arbitration in the Hague.

The evidentiary hearing phase of the arbitration proceedings has now been completed in front of the Arbitral Tribunal. With completion of the hearing, the Arbitral Tribunal will render an Award (i.e., a decision) in due course. There is no specified date for an Award to be rendered. Subsequent to the end of the half-year, the Company filed its post hearing brief with the Tribunal. The Company’s claims for damages against Poland are in the amount of up to £737 million (A$1.3 billion/PLN4.0 billion), which includes a revised assessment of the value of GreenX’s lost profits and damages related to both the Jan Karski and Debiensko projects, and accrued interest related to any damages. The Claim for damages has been assessed by independent external quantum experts appointed by GreenX specifically for the purposes of the Claim.

In July 2020, the Company announced it had executed the LFA for US$12.3 million with Litigation Capital Management (LCM). The facility is currently being drawn down to cover legal, tribunal and external expert costs as well as defined operating expenses associated with the Claim. The LFA is a limited recourse loan with LCM that is on a “no win – no fee” basis.

In September 2020, GreenX announced that it had formally commenced with the Claim by serving the Notices of Arbitration against the Republic of Poland. In June 2021, GreenX announced that it had formally lodged its Statement of Claim in the BIT arbitration, including the first assessed claim for compensation. The Company’s Statement of Reply was submitted in July 2022 which addressed various points raised by the Republic of Poland in their Statement of Defence. The Statement of Reply also contained a re-evaluation of the claim for damages based on consideration of Poland’s Statement of Defence.

GreenX’s dispute alleges that the Republic of Poland has breached its obligations under the applicable Treaties through its actions to block the development of the Company’s Jan Karski and Debiensko projects in Poland which effectively deprived GreenX of the entire value of its investments in Poland.

In February 2019, GreenX formally notified the Polish Government that there exists an investment dispute between GreenX and the Polish Government. GreenX’s notification called for prompt negotiations with the Government to amicably resolve the dispute and indicated GreenX’s right to submit the dispute to international arbitration in the event of the dispute not being resolved amicably.

GreenX’s investment dispute with the Republic of Poland is not unique, with international media widely reporting that the political environment and investment climate in Poland has deteriorated since the change in Government in 2015. As a result, there are a significant number of International Arbitration claims being bought against Poland.

Highly encouraging results from initial ARC site visit

During the period, GreenX and its joint-venture (JV) partner Greenfields Exploration Ltd (Greenfields) announced the results of from the first visit to ARC.

The results of this work program have demonstrated the high-grade nature of the known copper sulphide mineralisation and wider copper mineralization in fault hosted Black Earth zones and adjacent sandstone units. The exact position of a native copper fissure at the Neergaard Dal prospect was also identified.

Analysis of this new information is underway and will be key to future work programs.

A logistical base in Greenland was also secured as part of the site visit. The Company successfully established depots, and field trialled its SHERP vehicles and advanced satellite communications systems.

Share Placing to UK and European Investors

In March 2023, the Company announced the Placing to issue 12.4 million new ordinary shares to raise gross proceeds of approximately £3.9 million (~A$6.8 million) from new and existing UK and European investors and some Australian investors. Due to high demand, directors resolved to increase the Placing to issue 14.1 million new ordinary shares to raise total gross proceeds of approximately £4.4 million (~A$7.7 million). The Placing shares were issued on 14 March 2023.

Results of Operations

The net loss of the Consolidated Entity for the half-year ended 31 December 2022 was $1,432,272 (31 December 2021: $1,963,939). Significant items contributing to the current half-year loss and the substantial differences from the previous half-year include to the following:

(i) Arbitration related expenses of $4,830,784 (31 December 2021: $1,241,087) relating to the Claim against the Republic of Poland. This has been offset by the arbitration funding income of $4,795,937 (31 December 2021: $1,342,440);

(ii) Sale of land rights at Debiensko of nil (31 December 2021: $654,428);

(iii) Exploration and evaluation expenses of $668,066 (31 December 2021: $763,800), which is attributable to the Group’s accounting policy of expensing exploration and evaluation expenditure incurred by the Group subsequent to the acquisition of rights to explore and up to the commencement of a bankable feasibility study for each separate area of interest;

(iv) Business development expenses of $132,578 (31 December 2021: $182,433) which includes expenses relating to the Group’s review of new business and project opportunities plus also investor relations activities during the six months to 31 December 2022 including public relations, digital marketing, travel costs, attendances at conferences and business development consultant costs;

(v) Non-cash share-based payment expense of nil (31 December 2021: $1,203,339) due to incentive securities issued to key management personnel and other key employees and consultants of the Group as part of the long-term incentive plan to reward key management personnel and other key employees and consultants for the long-term performance of the Group. The expense results from the Group’s accounting policy of expensing the fair value (determined using an appropriate pricing model) of incentive securities granted on a straight-line basis over the vesting period of the options and rights. During the prior period, the Company issued 10,750,000 unlisted options which vested on issue; and

(vi) Revenue of $161,385 (31 December 2021: $111,664) consisting of interest income of $27,901 (31 December 2021: $9,643) and the receipt of $133,484 (31 December 2021: $102,021) of gas and property lease income derived at Debiensko.

Financial Position

At 31 December 2022, the Group had cash reserves of $2,574,558 (30 June 2022: $6,106,847) and the US$12.3 million arbitration facility (US$4.2 million available at 31 December 2022) placing it in a good financial position to continue with exploration activities at ARC and with the Claim. On completion of the Placing, the Group will have cash reserves of A$10 million.

At 31 December 2022, the Company had net assets of $10,329,665 (30 June 2022: $11,812,416) an decrease of approximately 13% compared with 30 June 2022. This is largely driven by the loss of the half-year of $1,432,272 (31 December 2021: $1,963,939).

Business Strategies and Prospects for Future Financial Years

GreenX’s strategy is to create long-term shareholder value through the discovery, exploration, development and acquisition of technically and economically viable mineral deposits. This also includes pursuing the Claim against the Republic of Poland through international arbitration in the short to medium term.

To date, the Group has not commenced production of any minerals, nor has it identified an any Ore reserves in accordance with the JORC Code. To achieve its objective, the Group currently has the following business strategies and prospects over the medium to long term:

· Continue to enforce its rights through an established and enforceable legal framework in relation to international arbitration for the investment dispute between GreenX and the Polish Government that has arisen out of certain measures taken by Poland in breach of the Treaties;

· Continue to assess corporate options for GreenX’s investments in Poland;

· Identify and assess other suitable business opportunities in the resources sector; and

· Continue with exploration activities in Greenland.

All of these activities are inherently risky and the Board is unable to provide certainty of the expected results of these activities, or that any or all of these likely activities will be achieved. Furthermore, GreenX will continue to take all necessary actions to preserve the Company’s rights and protect its investments in Poland, if and as required. The material business risks faced by the Group that could have an effect on the Group’s future prospects, and how the Group manages these risks, include the following:

· Litigation risk – All industries, including the mining industry, are subject to legal and arbitration claims. Specifically, and as noted above, the Company is continuing with it its Claim against the Republic of Poland, and will strongly defend its position and will continue to take all relevant actions to pursue its legal rights in the Claim process. During the period, the hearing for the Claim was completed with Tribunal to render an Award (i.e., a decision) in due course with no specified date available for the Tribunal decision. There is however no certainty that the Claim will be successful. If the Claim is unsuccessful, then this may have a material impact on the value of the Company’s securities.

· Earn-in and joint venture contractual risk – The Company’s earn-in right to the Project is subject to the Earn-In Agreement (EIA) with Greenfields as announced in October 2021. The Company’s ability to achieve its objectives is dependent on it and other parties complying with their obligations under the Agreement. Any failure to comply with these obligations may result in the Company not obtaining its interests in the Project and being unable to achieve its commercial objectives, which may have a material adverse effect on the Company’s operations and the performance and value of the Shares. There is also the risk of disputes arising with the Company’s joint venture partner, Greenfields, the resolution of which could lead to delays in the Company’s proposed development activities or financial loss.

If and when the Company earns in its interest in the Project, an incorporated joint venture will be established between the Company and Greenfields. The nature of the joint venture may change in future, including the ownership structure and voting rights in relation to the Project, which may have an effect on the ability of the Company to influence decisions on the Project.

· Operations in overseas jurisdictions risk – The Project is located in Greenland, and as such, the operations of the Company will be exposed to related risks and uncertainties associated with the country, regional and local jurisdictions. Opposition to the Project, or changes in local community support for the Project, along with any changes in mining or investment policies or in political attitude in Greenland and, in particular to the mining, processing or use of copper, may adversely affect the operations, delay or impact the approval process or conditions imposed, increase exploration and development costs, or reduce profitability of the Company. Moreover, logistical difficulties may arise due to the assets being located overseas such as the incurring of additional costs with respect to overseeing and managing the Project, including expenses associated with taking advice in relation to the application of local laws as well as the cost of establishing a local presence in Greenland. Fluctuations in the currency of Greenland may also affect the dealings and operations of the Company.

Failure to comply strictly with applicable laws, regulations and local practices relating to mineral rights applications and tenure, could result in loss, reduction or expropriation of entitlements, or the imposition of additional local or foreign parties as joint venture partners with carried or other interests. Further, the outcomes in courts in Greenland may be less predictable than in Australia, which could affect the enforceability of contracts entered into by the Company.

The Project is remotely located in an area that has an arctic climate and that is categorised as an arctic desert, and as such, the operations of the Company will be exposed to related risks and uncertainties of arctic exploration, including adverse weather or ice conditions which may and has prevented access to the Project, which can impact exploration and field activities or generate unexpected costs. It is not possible for the Company to predict or protect the Company against all such risks.

The Company also had previous operations in Poland which may be subject to regulations concerning protection of the environment, including at the Debiensko and Kaczyce projects which have both been relinquishment by the Company. As with all exploration projects and mining operations, activities will have an impact on the environment including the possible requirement to make good any disturbed or damaged land.

Existing and possible future environmental protection legislation, regulations and actions could cause additional expense, capital expenditures and restrictions, the extent of which cannot be predicted which could have a material adverse effect on the Company’s business, financial condition and results of operations.

· The Group’s exploration and development activities will require further capital – The exploration and any development of the Company’s exploration properties will require substantial additional financing. Failure to obtain sufficient financing may result in delaying or indefinite postponement of exploration and any development of the Company’s properties or even a loss of property interest. There can be no assurance that additional capital or other types of financing will be available if needed or that, if available, the terms of such financing will be favourable to the Company.

· The Group’s exploration properties may never be brought into production – The exploration for, and development of, mineral deposits involves a high degree of risk. Few properties which are explored are ultimately developed into producing mines. To mitigate this risk, the Company will undertake systematic and staged exploration and testing programs on its mineral properties and, subject to the results of these exploration programs, the Company will then progressively undertake a number of technical and economic studies with respect to its projects prior to making a decision to mine. However, there can be no guarantee that the studies will confirm the technical and economic viability of the Company’s mineral properties or that the properties will be successfully brought into production.

· The Group may be adversely affected by fluctuations in copper prices – The price of copper fluctuates widely and is affected by numerous factors beyond the control of the Group. Future production, if any, from the Group’s mineral properties will be dependent upon copper prices being adequate to make these properties economic. The Group currently does not engage in any hedging or derivative transactions to manage commodity price risk. As the Group’s operations change, this policy will be reviewed periodically going forward.

· The Group may be adversely affected by competition within the copper industry – The Group competes with other domestic and international copper companies, some of whom have larger financial and operating resources. Increased competition could lead to higher supply or lower overall pricing. There can be no assurance that the Company will not be materially impacted by increased competition. In addition, the Group is continuing to secure additional surface and mineral rights, however there can be no guarantee that the Group will secure additional surface and mineral rights, which could impact on the results of the Group’s operations.

· The Company may be adversely affected by fluctuations in foreign exchange – Current and planned activities are predominantly denominated in Stirling, Danish krone and/or Euros and the Company’s ability to fund these activates may be adversely affected if the Australian dollar continues to fall against these currencies. The Company currently does not engage in any hedging or derivative transactions to manage foreign exchange risk. As the Company’s operations change, this policy will be reviewed periodically going forward.

#SVML Sovereign Metals – Half-year Report

14th March 2023 / Leave a comment

SOVEREIGN METALS LIMITED

ABN 71 120 833 427

INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2022

CORPORATE DIRECTORY

Directors
Mr Benjamin Stoikovich Chairman

Dr Julian Stephens Managing Director
Mr Ian Middlemas Non-Executive Director

Mr Mark Pearce Non-Executive Director

Mr Nigel Jones Non-Executive Director

Company Secretary
Mr Dylan Browne

London Office
Unit 3C, 38 Jermyn Street, London
SW1Y 6DN, United Kingdom
Telephone: +44 207 478 3900

Registered and Principal Office
Level 9, 28 The Esplanade
Perth WA   6000
Telephone:                  +61 8 9322 6322
Facsimile:                    +61 8 9322 6558

Operations Office

Area 9

Lilongwe

Malawi

Stock Exchange Listings
Australia

Australian Securities Exchange
ASX Code: SVM – Ordinary Shares

United Kingdom

London Stock Exchange (AIM)

AIM Code: SVML – Depository Interests

Nominated Advisor

RFC Ambrian Limited
Octagon Point
5 Cheapside
London EC2V 6AA
United Kingdom

Brokers

Berenberg, Gossler & Co, KG, London Branch
60 Threadneedle Street
London EC2R 8HP
United Kingdom
T: +44 20 3753 3132

Optiva Securities Limited
49 Berkeley Square
Mayfair
London W1J 5AZ
United Kingdom

Share Register
Australia

Computershare Investor Services Pty Ltd
Level 5
191 St Georges Terrace
Perth WA 6000

Telephone:                  1300 850 505
International:               +61 8 9323 2000
Facsimile:                    +61 8 9323 2033

United Kingdom

Computershare Investor Services PLC
The Pavilions,
Bridgewater Road,
Bristol BS99 6ZZ
Telephone: +44 370 702 0000

Solicitors
Thomson Geer

Auditor
Ernst & Young

Bankers
National Australia Bank

Standard Bank – Malawi

CONTENTS

Directors’ Report

Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income

Condensed Consolidated Statement of Financial Position

Condensed Consolidated Statement of Changes in Equity

Condensed Consolidated Statement of Cash Flows

Notes to the Financial Statements

Directors’ Declaration

Competent Person Statement

To view the following sections plus all figures and illustrations, please refer to the full version of the Interim Financial Report on our website at www.sovereignmetals.com.au

Auditor’s Independence Declaration

Independent Auditor’s Review Report

The Directors of Sovereign Metals Limited present their report on Sovereign Metals Limited (Sovereign or the Company or Parent) and the entities it controlled at the end of, or during, the half year ended 31 December 2022 (Consolidated Entity or Group).

DIRECTORS

The names of Directors in office at any time during the financial period or since the end of the financial period are:

Current Directors

Mr Benjamin Stoikovich Chairman

Dr Julian Stephens Managing Director

Mr Ian Middlemas Non-Executive Director

Mr Mark Pearce Non-Executive Director

Mr Nigel Jones Non-Executive Director

All Directors were in office from 1 July 2022 until the date of this report, unless otherwise noted.

REVIEW AND RESULTS OF OPERATIONS

Highlights during and subsequent to period end

Kasiya Rutile Project PFS continues to progress on schedule

· Sovereign is well advanced with the Pre-Feasibility Study (PFS) for the Kasiya Rutile Project (Kasiya), an industry-leading major source of critical raw materials from Malawi.

· The PFS will build on the Expanded Scoping Study (ESS) which confirmed Kasiya as potentially one of the world’s largest and potentially lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than other current and planned producers.

· The PFS is on track to be completed in H1 2023 with all major works packages well progressed.

Resource infill drilling completed

· The Company completed a 4,660 metre, 191-hole deeper air-core (AC) and 2,206 metre, 247-hole push tube (PT) mineral resource infill drilling program to upgrade the Kasiya Mineral Resource Estimate (MRE), with the update targeted for late Q1 2023.

· The drilling program confirmed consistency of high-grade rutile and graphite mineralisation laterally and at depth.

· Infill core PT drilling of numerous Inferred category pits and potential pit extensions is expected to add new blocks of Indicated material.

Offtake MoU and Market Alliance with major Japanese trader

· In July 2022, Memorandum of Understanding (MoU) (non-binding) was signed with Mitsui & Co Ltd (Mitsui), one of the largest global trading and investment companies in Japan.

· The MoU establishes a marketing alliance and offtake for 30,000 tonnes of natural rutile per annum. The alliance will allow Sovereign to leverage Mitsui’s extensive network and their market-leading understanding of the titanium industry and global logistics.

Offtake MoU with Chemours, one of the world’s largest’ s producers of high-quality titanium dioxide pigment

· In November 2022, a MoU (non-binding) was signed for supply of 20,000 tonnes of natural rutile per annum from Kasiya to the US-based Chemours Company (Chemours), one of the world’s largest producers of high-quality titanium dioxide pigments.

Sovereign to Demerge Standalone Graphite Projects

· Sovereign to demerge its standalone Graphite Projects (being the Nanzeka, Malingunde, Duwi and Mabuwa Projects) into a 100%-owned subsidiary, NGX Limited, via an in-specie distribution.

· The Demerger seeks to unlock the value of the Graphite Projects for Sovereign shareholders and separate Kasiya and its standalone Graphite Projects into two distinct companies.

· General Meeting for Demerger to take place on 17 March 2023.

Sovereign Metals Limited (ASX: SVM & AIM: SVML) is an ASX and AIM-listed company focussed on the development of its Kasiya rutile project (Kasiya) in Malawi.

Kasiya, located in central Malawi, is the largest natural rutile deposit and one of the largest flake graphite deposits in the world. Sovereign is aiming to develop an environmentally and sustainable operation to supply highly sought-after natural rutile and graphite to global markets.

Sovereign is completing a PFS which will build on the ESS, released in June 2022, with targeted completion in H1 2023.

The ESS confirmed Kasiya as potentially one of the world’s largest and lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than current alternatives. The ESS showed outstanding results including:

· a two-stage development (stage 2 self-funded) with full production at 24Mtpa throughput producing 265kt rutile and 170kt graphite per annum over a 25 year mine life

· exceptional economics including a post-tax NPV₈ of US$1,537m and post-tax IRR of 36%

· a large-scale operation with a low-cost profile resulting from the deposit’s near surface nature, high-grade, conventional processing flowsheet, and excellent existing infrastructure

PRE-FEASIBILITY STUDY

The Company commenced a PFS which will build on the ESS which confirmed Kasiya as one of the world’s largest and potentially lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than other current and planned producers.

The PFS is advancing well under the guidance of globally recognised consultants and is on schedule to be completed by its target date of H1 2023.

KASIYA RESOURCE INFILL DRILLING

During the period, the Company completed a 4,660 metre, 191-hole AC and 2,206 metre, 247-hole PT drilling program at Kasiya. Drilling was conducted on a nominal 200m x 200m grid spacing targeting upgrading of mineralisation into the Indicated category which could convert to Probable Reserves as part of the forthcoming PFS. The AC results confirmed that rutile mineralisation is continuous in many pit areas from surface down to the top of saprock, normally between 20m and 30m from surface.

PRODUCT MARKETING & OFF-TAKE

Mitsui

In July 2022, Sovereign entered into a non-binding MoU with Mitsui, one of the largest global trading and investment companies in Japan. The MoU establishes a marketing alliance and offtake for 30,000 tonnes of natural rutile per annum from the Company’s world-class Kasiya project.

This MoU creates a marketing alliance between the two parties to jointly market Sovereign’s rutile across Asia and other markets. The alliance will allow Sovereign to leverage off Mitsui’s extensive network and their market-leading understanding of the titanium industry and global logistics.

Mitsui has shared samples of rutile product from Kasiya with Asian end-users that have confirmed its premium chemical specifications should be suitable for use in their titanium sponge and pigment processes, as a precursor for high-grade, high-specification titanium metal and pigment production.

Chemours

In November 2022, Sovereign entered into a non-binding MOU with Chemours for the potential supply of 20,000 tonnes per annum of natural rutile from Kasiya.

The MOU covers the potential supply of 20,000 tonnes per annum of natural rutile at Stage 1 nameplate capacity and an option to take additional product (tonnage to be agreed) when Kasiya reaches Stage 2 nameplate capacity. Further, volumes may be varied up or down by mutual agreement and pricing will reference market prices of the day (both to be included in the definitive agreement).

The MOU is non-exclusive and non-binding and remains subject to negotiation and execution of the definitive agreement. The MOU will expire two years from the execution date but can be extended by agreement by both parties should a definitive agreement not have been reached by that time.

Chemours is a leading provider of performance chemicals that are key inputs in end-products and processes across a variety of industries. Chemours operates 29 manufacturing sites serving approximately 3,200 customers in approximately 120 countries.

Its Titanium Technologies segment is one of the world’s largest producers of high-quality titanium dioxide (TiO₂) pigment and aspires to be the most sustainable TiO₂ enterprise in the world. Using its proprietary chloride technology-pioneered in 1931 and improving ever since-Chemours provides innovative TiO₂ solutions for coatings, plastics, and laminates.

It operates four TiO₂ pigment production facilities: two in the United States, one in Mexico, and one in Taiwan totalling TiO2 pigment nameplate capacity of 1.25 million tonnes per year. In the year ended 31 December 2021, Chemours’ Titanium Technologies segment reported net sales of US$3.4 Billion.

The Company is continuing product marketing with further offtake MOUs expected to be executed in the near-term.

DEMERGER OF STANDALONE GRAPHITE PROJECTS

In December 2022, Sovereign announced that it intends to undertake a demerger (Demerger) whereby Sovereign’s Malawian graphite projects, being the Nanzeka Project, Malingunde Project, Duwi Project and Mabuwa Project (Graphite Projects), are to be demerged through NGX Limited (NGX), a wholly owned subsidiary of the Company. This will allow Sovereign to focus on the development of the Kasiya while unlocking value in its Graphite Projects for shareholders.

The Demerger allows Sovereign and the existing management team to focus on its flagship Kasiya Rutile Project, the largest natural rutile deposit in the world, with Sovereign retaining all graphite co-product from Kasiya.

Sovereign proposes, subject to shareholder approval, to demerge the Graphite Projects via a spin-out of NGX and in-specie distribution of NGX fully paid ordinary shares (NGX Shares) to Sovereign shareholders by issuing one (1) NGX Share for every eleven (11) Sovereign shares (SVM Shares) held (Distribution), allowing Sovereign shareholders to retain exposure to the value and upside of the Graphite Projects.

Upon completion of the Demerger, NGX intends to seek admission to the official list of the ASX. NGX will undertake a capital raising to satisfy the ASX admission requirements.

Sovereign shareholders will have the opportunity to retain further exposure to the value and upside of the Graphite Projects as the NGX IPO is expected to comprise a priority offer to existing shareholders on the basis of one (1) new NGX Share for every one (1) NGX Share received pursuant to the Demerger to raise approximately $8,600,000 and a general offer of $1,000,000 to assist with satisfying ASX spread requirements. This will ensure there is no cash outflow from Sovereign to NGX as part of the Demerger, other than applicable Sovereign expenses to effect the Demerger. The terms of the NGX IPO are yet to be finalised however.

The General Meeting for the Demerger is to take place on 17 March 2023.

OPERATING RESULTS

The net operating loss after tax for the half year ended 31 December 2022 was $8,486,503 (2021: $7,716,384) which is attributable to:

(i) exploration and evaluation expenditure of $5,792,042 (2021: $4,188,770), which is attributable to the Group’s accounting policy of expensing exploration and evaluation expenditure (other than expenditures incurred in the acquisition of the rights to explore) incurred by the Group in the period subsequent to the acquisition of the rights to explore up to the successful completion of definitive feasibility studies for each separate area of interest. The exploration and evaluation expenditure in the current period predominately relates to the Group’s on-going PFS at its Kasiya in Malawi and associated MRE drilling;

(ii) business development expenses of $1,130,083 (2021: $894,214) which are attributable to the Group’s costs in relation to its listing on the AIM Market of the London Stock Exchange and investor and shareholder relations including public relations, marketing and digital marketing, conference fees and travel costs;

(iii) one off upfront costs in relation to the demerger of NGX of $121,839 (2021: nil); and

(iv) non-cash share based payments expenses of $1,061,657 (2021: $2,210,324) which is attributable to the Group’s accounting policy of expensing the value of shares, incentive options and rights (estimated using an appropriate pricing model) granted to key employees, consultants and advisors. The value of incentive options and rights is measured at grant date and recognised over the period during which the option and rights holders become unconditionally entitled to the incentive securities.

SIGNIFICANT POST BALANCE DATE EVENTS

Other than the above, there are no matters or circumstances which have arisen since 31 December 2022 that have significantly affected or may significantly affect:

· the operations, in periods subsequent to 31 December 2022, of the Group;

· the results of those operations, in periods subsequent to 31 December 2022, of the Group; or

· the state of affairs, in periods subsequent to 31 December 2022, of the Group.

AUDITOR’S INDEPENDENCE DECLARATION

Section 307C of the Corporations Act 2001 requires our auditors, Ernst & Young, to provide the directors of Sovereign Metals Limited with an Independence Declaration in relation to the review of the half year financial report. This Independence Declaration is on page 15 and forms part of this Directors’ Report.

This report is made in accordance with a resolution of the directors made pursuant to section 306(3) of the Corporations Act 2001.

For and on behalf of the Directors

#GRX GreenX Metals Limited – Quarterly Activities Report December 2022

31st January 2023 / Leave a comment

HIGHLIGHTS

· During the quarter, the hearing for the international arbitration claims against the Republic of Poland under both the Energy Charter Treaty and the Australia-Poland Bilateral Investment Treaty was concluded.

o Combined arbitration hearing took place in front of the Arbitral Tribunal in London under the UNCITRAL Arbitration Rules for GreenX’s claims against Poland.

o Damages of up to £737 million (A$1.3 billion / PLN4.0 billion) have been claimed including the assessed value of GreenX’s lost profits and damages related to both the Jan Karski and Debiensko projects, and accrued interest related to any damages.

o The Company has funded the Claim proceedings under its US$12.3 million Litigation Funding Agreement (LFA).

· In November, the Company announced highly encouraging results from an initial site visit to ARC.

o Analysis of the site visit results is underway and will be key to future work programs.

o GreenX can earn up to 80% of the ARC copper project in Greenland. ARC is a significant, large-scale project (5,774km² license area) with historical exploration results and recent analysis indicative of an extensive mineral system with potential to host world-class copper deposits.

· Cash balance as at 31 December 2022 of A$2.6 million with a further A$6.1 million available under the LFA.

GreenX Metals Limited (ASX:GRX, LSE:GRX) (GreenX or the Company) is pleased to present its Quarterly Activities Report for the period during and subsequent to 31 December 2022.

DISPUTE WITH POLISH GOVERNMENT

During the quarter, the Company reported the conclusion of the hearing for the international arbitration claims (Claim) against the Republic of Poland under both the Energy Charter Treaty (ECT) and the Australia-Poland Bilateral Investment Treaty (BIT) (together the Treaties). The hearing took place in London in November 2022 and lasted two weeks.

Following completion of the hearing, the Arbitral Tribunal will render an Award (i.e., the legal term used for a ‘decision’ by the Tribunal) in due course with no specified date available for the Tribunal decision.

As previously advised, the arbitration and hearing proceedings in relation to the Claim are required to be kept confidential.

Details of the Claim

The Company’s Claim against the Republic of Poland is being prosecuted through an established and enforceable legal framework, with GreenX and Poland agreeing to apply the United Nations Commission on International Trade Law Rules (UNCITRAL) rules to the proceedings. The arbitration claims are being administered through the Permanent Court of Arbitration in the Hague.

The evidentiary hearing phase of the arbitration proceedings has now been completed in front of the Arbitral Tribunal. With completion of the hearing, the Arbitral Tribunal will render an Award in due course. There is no specified date for an Award to be rendered. The Company’s claims for damages against Poland are in the amount of up to £737 million (A$1.3 billion/PLN4.0 billion), which includes a revised assessment of the value of GreenX’s lost profits and damages related to both the Jan Karski and Debiensko projects, and accrued interest related to any damages. The Claim for damages has been assessed by independent external quantum experts appointed by GreenX specifically for the purposes of the Claim.

In July 2020, the Company announced it had executed the Litigation Funding Agreement (LFA) for US$12.3 million with Litigation Capital Management (LCM). The facility is currently being drawn down to cover legal, tribunal and external expert costs as well as defined operating expenses associated with the Claim. The LFA is a limited recourse loan with LCM that is on a “no win – no fee” basis.

In September 2020, GreenX announced that it had formally commenced with the Claim by serving the Notices of Arbitration against the Republic of Poland. In June 2021, GreenX announced that it had formally lodged its Statement of Claim in the BIT arbitration, including the first assessed claim for compensation. The Company’s Statement of Reply, the last material filing to be made by the Company for the BIT arbitration proceedings, was submitted in July 2021. The Statement of Reply addresses various points raised by the Republic of Poland in their Statement of Defence. The Statement of Reply also contains a re-evaluation of the claim for damages based on responses to Poland’s Statement of Defence.

GreenX’s dispute alleges that the Republic of Poland has breached its obligations under the applicable Treaties through its actions to block the development of the Company’s Jan Karski and Debiensko projects in Poland which effectively deprived GreenX of the entire value of its investments in Poland.

In February 2019, GreenX formally notified the Polish Government that there exists an investment dispute between GreenX and the Polish Government. GreenX’s notification called for prompt negotiations with the Government to amicably resolve the dispute and indicated GreenX’s right to submit the dispute to international arbitration in the event of the dispute not being resolved amicably.

GreenX’s investment dispute with the Republic of Poland is not unique, with international media widely reporting that the political environment and investment climate in Poland has deteriorated since the change in Government in 2015. As a result, there are a significant number of International Arbitration claims being bought against Poland.

HIGHLY ENCOURAGING RESULTS FROM INITIAL ARC SITE VISIT

During the quarter, GreenX and its joint-venture (JV) partner Greenfields Exploration Ltd (Greenfields) announced the results of from the first visit to the Arctic Rift Copper Project (ARC or the Project) in Greenland.

The results of this work program have demonstrated the high-grade nature of the known copper sulphide mineralisation and wider copper mineralization in fault hosted Black Earth zones and adjacent sandstone units. The exact position of a native copper fissure at the Neergaard Dal prospect was also identified.

Analysis of this new information is underway and will be key to future work programs.

A logistical base in Greenland was also secured as part of the site visit. The Company successfully established depots, and field trialed its SHERP vehicles and advanced satellite communications systems.

CORPORATE

Financial Position

As at 31 December 2022, GreenX had cash of A$2.6 million with a further A$6.1 million available to fund Claim related costs under the LFA.

-ENDS-

Forward Looking Statements

This release may include forward-looking statements. These forward-looking statements are based on GreenX’s expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of GreenX, which could cause actual results to differ materially from such statements. GreenX makes no undertaking to subsequently update or revise the forward-looking statements made in this release, to reflect the circumstances or events after the date of that release.

Competent Persons Statement

The information in this announcement that relates to Exploration Results for ARC is extracted from the ASX announcements dated 6 October 2021, 22 January 2022 and 28 November 2022 which are available to view at www.greenxmetals.com. GreenX confirms that (a) it is not aware of any new information or data that materially affects the information included in the original announcements; (b) all material assumptions and technical parameters underpinning the content in the relevant announcements continue to apply and have not materially changed; and (c) the form and context in which the Competent Person’s findings are presented have not been materially modified from the original announcements.

APPENDIX 1: TENEMENT INFORMATION

As at 31 December 2022, the Company has an interest in the following tenements:

Location	Tenement	Percentage Interest	Status	Tenement Type
Greenland	Arctic Rift Copper Project (Licence No. 2021-07 MEL-S)	–¹	Granted	Exploration Licence
Jan Karski, Poland	Jan Karski Mine Plan Area (K-4-5, K6-7, K-8 and K-9)²	100	In dispute²	Exclusive Right to apply for a mining concession
Debiensko, Poland	Debiensko 1	100	Granted²	Mining
Debiensko, Poland	Kaczyce 1³	100	Granted	Mining & Exploration (includes gas rights)

Notes:

¹ In October 2021, the Company announced that it had entered into an Earn-In Agreement (EIA) with Greenfields to acquire an interest of up to 80% in ARC. As at the date of this announcement, the Company held no beneficial interest in ARC, other than through the EIA.

² GreenX formally commenced international arbitration claims against the Republic of Poland under both the ECT and the BIT in 2021. GreenX alleges that the Republic of Poland has breached its obligations under the Treaties through its actions to block the development of the Company’s Jan Karski and Debiensko mines in Poland. Refer to discussion of the Claim above.

³ The Kaczyce 1 tenement was due to expire on 31 December 2021. The Company applied for an extension to the Kaczyce 1 tenement prior to its expiry and awaits a decision.

APPENDIX 2: RELATED PARTY PAYMENTS

During the quarter ended 31 December 2022, the Company made payments of $166,000 to related parties and their associates. These payments relate to existing remuneration arrangements (director fees, consulting fees and superannuation of ($118,000) and the provision of a serviced office and company secretarial and administration services ($48,000).

APPENDIX 3: EXPLORATION AND MINING EXPENDITURE

During the quarter ended 31 December 2022, the Company made the following payments in relation to exploration activities:

Activity	$000
Greenland (ARC)
Project Management	163
Logistics (including transportation of equipment)	241
Site visit related costs	316
Other (field supplies, equipment, fuel, satellite imagery, etc)	119
Greenland sub-total as reported in the Appendix 5B (item 2.1(d))	839

Poland
Legal and permitting related expenditure	52
Consultants – technical and Debiensko statutory operations personnel	124
Other (VAT returned)	(69)
Poland sub-total as reported in the Appendix 5B (item 1.2(a))	107
Total	946

There were no mining or production activities and expenses incurred during the quarter ended 31 December 2022.

Appendix 5B

Mining exploration entity or oil and gas exploration entity
quarterly cash flow report

Name of entity
GreenX Metals Limited
ABN		Quarter ended (“current quarter”)
23 008 677 852		31 December 2022

Consolidated statement of cash flows		Current quarter $A’000	Year to date (6 months) $A’000
1.	Cash flows from operating activities	–	–
1.1	Receipts from customers	–	–
1.2	Payments for	(107)*	(471)*
	(a) exploration & evaluation	(107)*	(471)*
	(b) development	–	–
	(c) production	–	–
	(d) staff costs	(122)	(258)
	(e) administration and corporate costs	(85)	(204)
1.3	Dividends received (see note 3)	–	–
1.4	Interest received	15	28
1.5	Interest and other costs of finance paid	–	–
1.6	Income taxes paid	–	–
1.7	Government grants and tax incentives	–	–
1.8	Other (provide details if material) (a) Business Development (b) Property rental and gas sales (c) Arbitration related expenses (d) Receipt of arbitration funding (e) Occupancy	(80) 73 (862) 420 (80)	(141) 96 (1,446) 1,187 (415)
1.9	Net cash from / (used in) operating activities	(828)	(1,624)
*includes legal and permitting expenditure and payments made to consultants (Debiensko technical statutory operations personnel).
2.	Cash flows from investing activities	–	–
2.1	Payments to acquire or for:
	(a) Entities
	(b) Tenements	–	–
	(c) property, plant and equipment	–	–
	(d) exploration & evaluation	(839)	(1,908)
	(e) investments	–	–
	(f) other non-current assets	–	–
2.2	Proceeds from the disposal of:	–	–
	(a) entities	–	–
	(b) tenements	–	–
	(c) property, plant and equipment	–	–
	(d) investments	–	–
	(e) other non-current assets	–	–
2.3	Cash flows from loans to other entities	–	–
2.4	Dividends received (see note 3)	–	–
2.5	Other (provide details if material)	–	–
2.6	Net cash from / (used in) investing activities	(839)	(1,908)

3.	Cash flows from financing activities	–	–
3.1	Proceeds from issues of equity securities (excluding convertible debt securities)	–	–
3.2	Proceeds from issue of convertible debt securities	–	–
3.3	Proceeds from exercise of options	–	–
3.4	Transaction costs related to issues of equity securities or convertible debt securities	–	–
3.5	Proceeds from borrowings	–	–
3.6	Repayment of borrowings	–	–
3.7	Transaction costs related to loans and borrowings	–	–
3.8	Dividends paid	–	–
3.9	Other (provide details if material)	–	–
3.10	Net cash from / (used in) financing activities	–	–

4.	Net increase / (decrease) in cash and cash equivalents for the period
4.1	Cash and cash equivalents at beginning of period	4,243	6,108
4.2	Net cash from / (used in) operating activities (item 1.9 above)	(828)	(1,624)
4.3	Net cash from / (used in) investing activities (item 2.6 above)	(839)	(1,908)
4.4	Net cash from / (used in) financing activities (item 3.10 above)	–	–
4.5	Effect of movement in exchange rates on cash held	–	–
4.6	Cash and cash equivalents at end of period	2,576	2,576

5.	Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts	Current quarter $A’000	Previous quarter $A’000
5.1	Bank balances	2,576	4,243
5.2	Call deposits	–	–
5.3	Bank overdrafts	–	–
5.4	Other (provide details)	–	–
5.5	Cash and cash equivalents at end of quarter (should equal item 4.6 above)	2,576	4,243

6.	Payments to related parties of the entity and their associates	Current quarter $A’000
6.1	Aggregate amount of payments to related parties and their associates included in item 1	(166)
6.2	Aggregate amount of payments to related parties and their associates included in item 2	–
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an explanation for, such payments.

7.	Financing facilities Note: the term “facility’ includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity.	Total facility amount at quarter end $A’000	Amount drawn at quarter end $A’000
7.1	Loan facilities	18,036*	11,935
7.2	Credit standby arrangements	–	–
7.3	Other (please specify)	–	–
7.4	Total financing facilities	18,036*	11,935

7.5	Unused financing facilities available at quarter end		6,101
7.6	Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well.
7.6	On 30 June 2020, the Company executed a Litigation Funding Agreement (LFA) for US$12.3 million (*now worth A$18.0 million with the movement of the A$ compared to the $US) with LCM Funding UK Limited a subsidiary of Litigation Capital Management Limited (LCM), to pursue damages claims in relation to the investment dispute between GreenX and the Polish Government that has arisen out of certain measures taken by Poland in breach of the Energy Charter Treaty and the Australia – Poland Bilateral Investment Treaty (BIT). LCM will provide up to US$12.3million (~A$18.0 million), denominated in US$, in limited recourse financing which is repayable to LCM in the event of a successful Claim or settlement of the Dispute that results in the recovery of any monies. If there is no settlement or award, then LCM is not entitled to any repayment of the financing facility. In return for providing the financing facility, LCM shall be entitled to receive repayment of any funds drawn plus an amount equal to between two and five times the total of any funds drawn from the funding facility during the first five years, depending on the time frame over which funds have remained drawn, and then a 30% interest rate after the fifth year until receipt of damages payments.

8.	Estimated cash available for future operating activities	$A’000
8.1	Net cash from / (used in) operating activities (item 1.9)	(828)
8.2	(Payments for exploration & evaluation classified as investing activities) (item 2.1(d))	(839)
8.3	Total relevant outgoings (item 8.1 + item 8.2)	(1,667)
8.4	Cash and cash equivalents at quarter end (item 4.6)	2,576
8.5	Unused finance facilities available at quarter end (item 7.5)	6,101
8.6	Total available funding (item 8.4 + item 8.5)	8,677

8.7	Estimated quarters of funding available (item 8.6 divided by item 8.3)	>5
8.7	Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3, answer item 8.7 as “N/A”. Otherwise, a figure for the estimated quarters of funding available must be included in item 8.7.
8.8	If item 8.7 is less than 2 quarters, please provide answers to the following questions:
	8.8.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?
	Answer: Not applicable
	8.8.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful?
	Answer: Not applicable
	8.8.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis?
	Answer: Not applicable
	Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above must be answered.

#SVML Sovereign Metals Limited – December 2022 Quarterly Report

31st January 2023 / Leave a comment

HIGHLIGHTS

Kasiya Rutile Project PFS continues to progress on schedule

· Sovereign is well advanced with the Pre-Feasibility Study (PFS) for the Kasiya Rutile Project (Kasiya), an industry-leading major source of critical raw materials from Malawi.

· The PFS will build on the Expanded Scoping Study (ESS) which confirmed Kasiya as potentially one of the world’s largest and potentially lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than other current and planned producers.

· The PFS is on track to be completed in H1 2023 with all major works packages well progressed.

Resource infill drilling completed

· The Company completed a 4,660 metre, 191-hole deeper air-core (AC) and 2,206 metre, 247-hole push tube (PT) mineral resource infill drilling program to upgrade the Kasiya Mineral Resource Estimate (MRE), with the update targeted for Q1 2023.

· The drilling program confirmed consistency of high-grade rutile and graphite mineralisation at depth.

· Infill core PT drilling of numerous Inferred category pits and potential pit extensions is expected to add new blocks of Indicated material.

Offtake MoU with Chemours, one of the world’s largest’ s producers of high-quality titanium dioxide pigment

· In November 2022, a Memorandum of Understanding (MoU) (non-binding) was signed for supply of 20,000 tonnes of natural rutile per annum from Kasiya to US-based Chemours, one of the world’s largest producers of high-quality titanium dioxide pigments.

Sovereign to Demerge Standalone Graphite Projects

· Sovereign plans to demerge its standalone Graphite Projects (being the Nanzeka, Malingunde, Duwi and Mabuwa Projects) into a 100%-owned subsidiary, NGX Limited, then do an in-specie distribution.

· The Demerger seeks to unlock the value of the Graphite Projects for Sovereign shareholders and separate its Kasiya Rutile Project and its standalone Graphite Projects into two distinct companies.

ENQUIRIES

Dr Julian Stephens (Perth)
Managing Director

+61(8) 9322 6322

Sam Cordin (Perth)
+61(8) 9322 6322

Sapan Ghai (London)
+44 207 478 3900

Nominated Adviser on AIM
RFC Ambrian
Bhavesh Patel / Andrew Thomson	+44 20 3440 6800

Joint Brokers
Berenberg	+44 20 3207 7800
Matthew Armitt
Jennifer Lee

Optiva Securities	+44 20 3137 1902
Daniel Ingram
Mariela Jaho
Christian Dennis

KASIYA – THE LARGEST RUTILE DEPOSIT IN THE WORLD

Kasiya, located in central Malawi, is the largest natural rutile deposit and one of the largest flake graphite deposits in the world. Sovereign is aiming to develop an environmentally and sustainable operation to supply highly sought-after natural rutile and graphite to global markets.

Sovereign is completing a PFS which will build on the on the ESS, released in June 2022, with targeted completion in H1 2023.

The ESS confirmed Kasiya as potentially one of the world’s largest and lowest cost producers of natural rutile and natural graphite with a carbon-footprint substantially lower than current alternatives. The ESS showed outstanding results including:

· a two-stage development (stage 2 self-funded) with full production at 24Mtpa throughput producing 265kt rutile and 170kt graphite per annum over a 25 year mine life

· exceptional economics including a post-tax NPV₈ of US$1,537m and post-tax IRR of 36%

· a large-scale operation with a low-cost profile resulting from the deposit’s near surface nature, high-grade, conventional processing flowsheet, and excellent existing infrastructure

· conservative assumptions applied with long-term prices used discounted against current spot prices

PFS ACTIVITIES

The PFS for Kasiya continued during the quarter with all major work programs progressing well. The study remains on track for a targeted completion in H1 2023. A summary of key areas progressed during the quarter is as follows:

Mining

Fraser Alexander have progressed the mechanical engineering and design of the mining plan with the defined concept of hydro-mining. The Company also completed a trade-off study examining hydro-mining vs dozer mining options to validate the selected mining method.

Pumping and Rheology

The Company commenced a comprehensive testwork program with Paterson and Cooke to generate mineral properties information and pumping and rheology data to feed into their pumping and piping design and layout work program.

Metallurgy

A bulk metallurgical program focused on the first years of mining is well advanced with the program designed to conclude the process design and flowsheet. Additional variability tests are planned, with all samples extracted now in Perth for processing.

An initial graphite co-product testwork program was also completed earlier in the quarter with the sizing and chemical characteristics matching the product specifications used in the ESS.

Tailings and Rehabilitation

The Project’s objective is to minimise the operation’s footprint via progressive rehabilitation, a concept common across mineral sands operations. The Company has defined a comprehensive testwork program with numerous work streams underway designed and supervised by global experts from Australia and South Africa.

In addition to the tailings testwork the post-mining rehabilitation study continues. This work program is led by Agreenco, a South African based consulting firm with significant expertise in rehabilitation and revegetation.

KASIYA RESOURCE INFILL DRILLING

A 4,660 metre, 191-hole AC and 2,206 metre, 247-hole PT drilling program at the Kasiya rutile deposit has been completed. Drilling was conducted on a nominal 200m x 200m grid spacing targeting upgrading of mineralisation into the Indicated category which could convert to Probable Reserves as part of the forthcoming PFS.

The AC results confirmed that rutile mineralisation is continuous in many pit areas from surface down to the top of saprock, normally between 20m and 30m from surface.

RUTILE OFFTAKE

In November 2022, Sovereign entered into a non-binding MOU with The Chemours Company (Chemours) for the potential supply of 20,000 tonnes per annum of natural rutile from Kasiya.

The MOU covers the potential supply of 20,000 tonnes per annum of natural rutile at Stage 1 nameplate capacity and an option to take additional product (tonnage to be agreed) when Kasiya reaches Stage 2 nameplate capacity (refer to announcement dated 16 June 2022 entitled ‘Kasiya Expanded Scoping Study Results‘). Further, volumes may be varied up or down by mutual agreement and pricing will reference market prices of the day (both to be included in the definitive agreement).

The MOU is non-exclusive and non-binding and remains subject to negotiation and execution of the definitive agreement. The MOU will expire two years from the execution date but can be extended by agreement by both parties should a definitive agreement not have been reached by that time.

Chemours is a leading provider of performance chemicals that are key inputs in end-products and processes across a variety of industries. Chemours operates 29 manufacturing sites serving approximately 3,200 customers in approximately 120 countries.

Its Titanium Technologies segment is one of the world’s largest producers of high-quality titanium dioxide (TiO₂) pigment and aspires to be the most sustainable TiO₂ enterprise in the world. Using its proprietary chloride technology-pioneered in 1931 and improving ever since-Chemours provides innovative TiO₂ solutions for coatings, plastics, and laminates.

It operates four TiO₂ pigment production facilities: two in the United States, one in Mexico, and one in Taiwan totalling TiO2 pigment nameplate capacity of 1.25 million tonnes per year. In the year ended 31 December 2021, Chemours’ Titanium Technologies segment reported net sales of US$3.4 Billion.

The Company is continuing product marketing with further offtake MOUs expected to be executed in the near-term.

COMMUNITY INITIATIVES

During the quarter, Sovereign completed seven community boreholes and installation of hand pumps for provision of fresh water to a number of villages.

SOVEREIGN TO DEMERGE STANDALONE GRAPHITE PROJECTS

In December 2022, Sovereign announced that it intends to undertake a demerger (Demerger) whereby Sovereign’s Malawian graphite projects, being the Nanzeka Project, Malingunde Project, Duwi Project and Mabuwa Project (Graphite Projects), are to be demerged through NGX Limited (NGX), a wholly owned subsidiary of the Company. This will allow Sovereign to focus on the development of the Kasiya while unlocking value in its Graphite Projects for shareholders.

The Demerger allows Sovereign and the existing management team to focus on its flagship Kasiya Rutile Project, the largest natural rutile deposit in the world, with Sovereign retaining all graphite co-product from Kasiya.

Sovereign proposes, subject to shareholder approval, to demerge the Graphite Projects via a spin-out of NGX and in-specie distribution of NGX fully paid ordinary shares (NGX Shares) to Sovereign shareholders by issuing one (1) NGX Share for every eleven (11) Sovereign shares (SVM Shares) held (Distribution), allowing Sovereign shareholders to retain exposure to the value and upside of the Graphite Projects.

Upon completion of the Demerger, NGX intends to seek admission to the official list of the ASX. NGX will undertake a capital raising to satisfy the ASX admission requirements.

Sovereign shareholders will have the opportunity to retain further exposure to the value and upside of the Graphite Projects as the NGX IPO is expected to comprise a priority offer to existing shareholders on the basis of one (1) new NGX Share for every one (1) NGX Share received pursuant to the Demerger to raise approximately $8,600,000 and a general offer of $1,000,000 to assist with satisfying ASX spread requirements. This will ensure there is no cash outflow from Sovereign to NGX as part of the Demerger, other than applicable Sovereign expenses to effect the Demerger. The terms of the NGX IPO are yet to be finalised however.

NGX will be the offeror of the NGX Shares under the IPO. A prospectus will be issued by NGX for the IPO capital raising which will be made available when the NGX Shares are offered. Anyone wishing to acquire NGX Shares as part of the IPO offer will need to complete the application form that will accompany the prospectus.

A Notice of Meeting for the Demerger and Distribution will be sent to shareholders with the meeting planned to take place early in 2023.

Rationale for Demerger

· The Demerger allows the Company to better focus its efforts and resources on Kasiya and other primary rutile discoveries.

· The Demerger will provide shareholders with an interest in two companies – Sovereign and NGX. The Board believes a separate entity with a separate management team focused on the Graphite Projects presents a better prospect of delivering value to Sovereign shareholders.

· Shareholders may elect to retain exposure to either one or both companies as dictated by their investment preferences and objectives:

· Shareholders will retain an interest in NGX through the Distribution and thereby have an opportunity to benefit from the potential development of the Graphite Projects; and

· All Shareholders will retain their interest in the capital of Sovereign and exposure to Kasiya.

· The Board sees considerable potential in the Graphite Projects that is not recognised by the market and, therefore, a dedicated, separately funded vehicle may realise appropriate value for shareholders.

· Future capital raisings are expected to be more readily achieved by each individual entity as the focus of the funding will be on their specific projects. In addition, it is expected to provide greater flexibility to both Sovereign and NGX to attract strategic investors.

· NGX will have a dedicated board and management team to focus on the development of the Graphite Projects.

· After a full and proper assessment of all available information, the Directors believe that the Demerger is in the best interests of Sovereign shareholders.

Indicative Timetable of the Demerger

An indicative timetable for the Demerger is provided below.

Event	Indicative Date
General Meeting	Mid-March 2023
Effective date of Distribution	Mid-March 2023
Record Date	Late March 2023
Date for Distribution to Shareholders	Late March 2023

Note: The dates shown in the table above are indicative only and may vary subject to the Corporations Act, the ASX Listing Rules, and other applicable laws.

For further information and additional detail please refer to ASX Announcement dated 7 December 2022 entitled
‘Sovereign to Demerge Standalone Graphite Projects‘

RELATED PARTY PAYMENTS

During the quarter ended 31 December 2022, the Company made payments of ($242,000) to related parties and their associates. These payments relate to existing remuneration arrangements (executive salaries, director fees, superannuation and bonuses of $125,000), business development services ($30,000) and provision of serviced office facilities, company secretarial services and administration services ($87,000).

MINING EXPLORATION EXPENDITURES

During the quarter, the Company made the following payments in relation to mining exploration activities:

Activity	A$’000
Drilling	(548)
Assaying and Metallurgical Test-work	(633)
Studies and Reserve/Resource Estimation	(890)
Malawi Operations – Site Office, Personnel, Field Supplies, Equipment, Vehicles and Travel	(754)
Total as reported in Appendix 5B	(2,825)

There were no mining or production activities and expenses incurred during the quarter ended 31 December 2022.

Competent Person Statement

The information in this announcement that relates to the Mineral Resource Estimate is extracted from the announcement dated 5 April 2022. The announcement is available to view on www.sovereignmetals.com.au. Sovereign confirms that a) it is not aware of any new information or data that materially affects the information included in the announcement; b) all material assumptions included in the announcement continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons’ findings are presented in this report have not been materially changed from the announcement.

Table 1: Kasiya Mineral Resource Estimate at 0.7% Rutile Cut-off
Mineral Resource Category	Material Tonnes (millions)	Rutile (%)	Rutile Tonnes (millions)	Total Contained Graphite (TGC) (%)	TGC Tonnes (millions)	RutEq. Grade* (%)
Indicated	662	1.05%	6.9	1.43%	9.5	1.76%
Inferred	1,113	0.99%	11.0	1.26%	14.0	1.61%
Total	1,775	1.01%	18.0	1.32%	23.4	1.67%

* RutEq. Formula: Rutile Grade x Recovery (98%) x Rutile Price (US$1,308/t) + Graphite Grade x Recovery (62%) x Graphite Price (US$1,085/t) / Rutile Price (US$1,308/t). All assumptions are taken from this Study ** Any minor summation inconsistencies are due to rounding

The information in this announcement that relates to Production Targets, Processing, Infrastructure and Capital and Operating Costs, is extracted from the announcement dated 16 June 2022 entitled ‘Kasiya Expanded Scoping Study Results’. Sovereign confirms that: a) it is not aware of any new information or data that materially affects the information included in the announcement; b) all material assumptions and technical parameters underpinning the Production Target, and related forecast financial information derived from the Production Target included in the Announcement continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons’ findings are presented in this presentation have not been materially modified from the Announcement.

The information in this announcement that relates to the Metallurgy is extracted from the announcement dated 7 December 2021. The announcement is available to view on www.sovereignmetals.com.au. Sovereign confirms that a) it is not aware of any new information or data that materially affects the information included in the announcement; b) all material assumptions included in the announcement continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons’ findings are presented in this report have not been materially changed from the announcement.

The information in this announcement that relates to the Exploration Results is extracted from the announcement dated 8 September 2022, 26 October 2022 and 30 January 2023. The announcements are available to view on www.sovereignmetals.com.au. Sovereign confirms that a) it is not aware of any new information or data that materially affects the information included in the announcements; b) all material assumptions included in the announcements continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons’ findings are presented in this report have not been materially changed from the announcements.

Forward Looking Statement

This release may include forward-looking statements, which may be identified by words such as “expects”, “anticipates”, “believes”, “projects”, “plans”, and similar expressions. These forward-looking statements are based on Sovereign’s expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of Sovereign, which could cause actual results to differ materially from such statements. There can be no assurance that forward-looking statements will prove to be correct. Sovereign makes no undertaking to subsequently update or revise the forward-looking statements made in this release, to reflect the circumstances or events after the date of that release.

Authorisation Statement

To view this announcement in full, please refer to http://www.investi.com.au/api/announcements/svm/969e699e-3cd.pdf

APPENDIX 1: SUMMARY OF MINING TENEMENTS

As at 31 December 2022, the Company had an interest in the following tenements:

Licence	Holding Entity	Interest	Type	Licence Renewal Date	Expiry Term Date¹	Licence Area (km²)	Status
Sovereign:
EL0609	MML	100%	Exploration	25/09/2024	25/09/2028	440.5	Granted
EL0582	SSL	100%	Exploration	15/09/2023	15/09/2027	285.0	Granted
EL0492	SSL	100%	Exploration	29/01/2023	29/01/2025	935.4	Granted
EL0528	SSL	100%	Exploration	27/11/2023	27/11/2025	16.2	Granted
EL0545	SSL	100%	Exploration	12/05/2024	12/05/2026	53.2	Granted
EL0561	SSL	100%	Exploration	15/09/2023	15/09/2027	124.0	Granted
NGX:
EL0372	SSL³	100%	Exploration	N/A	13/03/2022²	729.2	Granted
RL0012	NGX	100%	Retention	N/A	26/07/2026	6.0	Granted
RL0032	SSL³	100%	Retention	N/A	4/10/2027	24.64	Granted

Notes:

SSL: Sovereign Services Limited, MML: McCourt Mining Limited & NGX Exploration Limited

¹ An exploration licence (EL) covering a preliminary period in accordance with the Malawi Mines and Minerals Act (No 8. Of 2019) (Mines Act) is granted for a period not exceeding three (3) years. Thereafter two successive periods of renewal may be granted, but each must not exceed two (2) years. This means that an EL has a potential life span of seven (7) years. ELs that have come to the end of their term can be converted by the EL holder into a retention licence (RL) for a term of up to 5 years subject to meeting certain criteria.

² Prior to expiry of EL0372, the Company applied for the grant of a mining licence (ML) over EL0372. Under the Mines Act, an EL term automatically extends until the ML application has been processed and/or granted. The ML has been granted subject to the approval of an ESIA for Malingunde.

³ Proposed to be transferred to NGX as part of the Demerger.

Appendix 5B

Mining exploration entity or oil and gas exploration entity
quarterly cash flow report

Name of entity
Sovereign Metals Limited
ABN		Quarter ended (“current quarter”)
71 120 833 427		31 December 2022

Consolidated statement of cash flows		Current quarter $A’000	Year to date (6 months) $A’000
1.	Cash flows from operating activities	–	–
1.1	Receipts from customers	–	–
1.2	Payments for	(2,825)	(5,085)
	(a) exploration & evaluation	(2,825)	(5,085)
	(b) development	–	–
	(c) production	–	–
	(d) staff costs	(344)	(874)
	(e) administration and corporate costs	(475)	(851)
1.3	Dividends received (see note 3)	–	–
1.4	Interest received	80	151
1.5	Interest and other costs of finance paid	–	–
1.6	Income taxes paid	–	–
1.7	Government grants and tax incentives	–	–
1.8	Other – Business Development	(326)	(497)
1.9	Net cash from / (used in) operating activities	(3,890)	(7,156)

2.	Cash flows from investing activities	–	–
2.1	Payments to acquire or for:
	(a) entities
	(b) tenements	–	–
	(c) property, plant and equipment	(23)	(23)
	(d) exploration & evaluation	–	–
	(e) investments	–	–
	(f) other non-current assets	–	–
2.2	Proceeds from the disposal of:	–	–
	(a) entities	–	–
	(b) tenements	–	–
	(c) property, plant and equipment	–	–
	(d) investments	–	–
	(e) other non-current assets	–	–
2.3	Cash flows from loans to other entities	–	–
2.4	Dividends received (see note 3)	–	–
2.5	Other (provide details if material)	–	–
2.6	Net cash from / (used in) investing activities	(23)	(23)

3.	Cash flows from financing activities	–	–
3.1	Proceeds from issues of equity securities (excluding convertible debt securities)	–	–
3.2	Proceeds from issue of convertible debt securities	–	–
3.3	Proceeds from exercise of options	–	–
3.4	Transaction costs related to issues of equity securities or convertible debt securities	(568)	(601)
3.5	Proceeds from borrowings	–	–
3.6	Repayment of borrowings	–	–
3.7	Transaction costs related to loans and borrowings	–	–
3.8	Dividends paid	–	–
3.9	Other (provide details if material)	–	–
3.10	Net cash from / (used in) financing activities	(568)	(601)

4.	Net increase / (decrease) in cash and cash equivalents for the period
4.1	Cash and cash equivalents at beginning of period	15,587	18,894
4.2	Net cash from / (used in) operating activities (item 1.9 above)	(3,890)	(7,156)
4.3	Net cash from / (used in) investing activities (item 2.6 above)	(23)	(23)
4.4	Net cash from / (used in) financing activities (item 3.10 above)	(568)	(601)
4.5	Effect of movement in exchange rates on cash held	9	1
4.6	Cash and cash equivalents at end of period	11,115	11,115

5.	Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts	Current quarter $A’000	Previous quarter $A’000
5.1	Bank balances	846	1,062
5.2	Call deposits	10,269	14,525
5.3	Bank overdrafts	–	–
5.4	Other (provide details)	–	–
5.5	Cash and cash equivalents at end of quarter (should equal item 4.6 above)	11,115	15,587

6.	Payments to related parties of the entity and their associates	Current quarter $A’000
6.1	Aggregate amount of payments to related parties and their associates included in item 1	242
6.2	Aggregate amount of payments to related parties and their associates included in item 2	–
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an explanation for, such payments.

7.	Financing facilities Note: the term “facility’ includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity.	Total facility amount at quarter end $A’000	Amount drawn at quarter end $A’000
7.1	Loan facilities	–	–
7.2	Credit standby arrangements	–	–
7.3	Other (please specify)	–	–
7.4	Total financing facilities	–	–

7.5	Unused financing facilities available at quarter end		–
7.6	Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well.
7.6	–

8.	Estimated cash available for future operating activities	$A’000
8.1	Net cash from / (used in) operating activities (item 1.9)	(3,890)
8.2	(Payments for exploration & evaluation classified as investing activities) (item 2.1(d))	–
8.3	Total relevant outgoings (item 8.1 + item 8.2)	(3,890)
8.4	Cash and cash equivalents at quarter end (item 4.6)	11,115
8.5	Unused finance facilities available at quarter end (item 7.5)	–
8.6	Total available funding (item 8.4 + item 8.5)	11,115

8.7	Estimated quarters of funding available (item 8.6 divided by item 8.3)	2.9
8.7	Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3, answer item 8.7 as “N/A”. Otherwise, a figure for the estimated quarters of funding available must be included in item 8.7.
8.8	If item 8.7 is less than 2 quarters, please provide answers to the following questions:
	8.8.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?
	Answer: Not applicable
	8.8.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful?
	Answer: Not applicable
	8.8.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis?
	Answer: Not applicable
	Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above must be answered.

#GRX GreenX Metals – Report on Payments to Governments

22nd December 2022 / Leave a comment

GreenX Metals Limited (“GreenX” or “Company”) and its controlled entities (“Group”) provides information in accordance with DTR 4.3A of the Financial Conduct Authority’s Disclosure and Transparency Rules in respect of payments made by the Company to governments for the year ended 30 June 2022 and 2021 and in compliance with The Reports on Payments to Governments Regulations and its amendment in 2015.

The following schedule details payments made to municipal and local Polish government entities, including the Czerwionka-Leszczyny and Zebrzydowice municipalities, by its wholly owned Polish subsidiary Karbonia S.A. (“Karbonia”), which holds the Debiensko project. Municipal and local Polish government entities are the only relevant parties to whom material payments have been made to.

	Total Payments 30 June 2022
Reporting Category	Karbonia: A$	Karbonia: PLN	Karbonia: EUR

Production entitlements	–	–	–
Income Taxes	–	–	–
Royalties	–	–	–
Dividends	–	–	–
Signature/discovery/production bonuses	–	–	–
Licence fees (including mining usufruct payments)	2,436	7,259	1,570
Property taxes to local Polish municipalities	71,614	213,401	46,138
Infrastructure improvements	–	–	–
Total	74,050	220,660	47,708

	Total Payments 30 June 2021
Reporting Category	Karbonia: A$	Karbonia: PLN	Karbonia: EUR

Production entitlements	–	–	–
Income Taxes	–	–	–
Royalties	–	–	–
Dividends	–	–	–
Signature/discovery/production bonuses	–	–	–
Licence fees (including mining usufruct payments)	27,548	78,063	15,284
Property taxes to local Polish municipalities	124,528	352,878	69,089
Infrastructure improvements	–	–	–
Total	152,076	430,941	84,373

Exchange Rates

In compliance with Polish reporting requirements, figures of the consolidated Report on Payments to Governments have been converted into PLN and EUR (from the Group’s presentation currency) by applying the arithmetic average for the final day of each month for the reporting period, as published by the National Bank of Poland (“NBP”). These exchange rates were 2.9799 AUD:PLN and 4.6253 PLN:EUR for the twelve months ended 30 June 2022, and 2.8337 AUD:PLN and 4.5271 PLN:EUR for the twelve months ended 30 June 2021.

This report is also available to download at www.greenxmetals.com.

Enquiries:

GreenX Metals Limited

Tel: +44 207 478 3900

Ben Stoikovich, Chief Executive Officer

Email: info@greenxmetals.com

Sapan Ghai, Head of Corporate Development

Kazimierz Chojna, Commercial Officer

#TYM Tertiary Minerals PLC – Annual Report & Notice of Annual General Meeting

22nd December 2022 / Leave a comment

Tertiary Minerals plc (AIM: TYM) is pleased to advise that a full version of the Annual Report, for the year ended 30 September 2022 and the Notice of the 2023 Annual General Meeting (“AGM”) has now been published on the Company’s website at:

https://www.tertiaryminerals.com/shareholder-documents

A letter or email, depending on individual preference, is being sent to registered shareholders today to notify them of the publication of the Annual Report and Notice.

The AGM has been convened for 10.00 a.m. on Thursday 16 February 2023 at Arundel House, 6 Temple Place, London WC2R 2PG.

Proxy Voting will be available from 5.00 p.m. and instructions can be found on page 53 of the Annual Report at the link above.

For more information please contact:

Tertiary Minerals plc:
Patrick Cheetham, Executive Chairman		+44 (0) 1625 838 679
SP Angel Corporate Finance LLP Nominated Adviser and Broker
Richard Morrison		+44 (0) 203 470 0470
Harry Davies-Ball
Peterhouse Capital Limited Joint Broker
Lucy Williams	+ 44 (0) 207 469 0930
Duncan Vasey

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

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Interim Management Report

Responsibility Statement of the Directors in respect of the Interim Report

Consolidated Statement of Comprehensive Income for the six month period ended 31 March 2023

Consolidated Statement of Financial Position as at 31 March 2023

Consolidated Statement of Changes in Equity for the six month period ended 31 March 2023

Consolidated Statement of Changes in Equity for the six month period ended 31 March 2023

Consolidated Statement of Cash Flows for the six month period ended 31 March 2023

Notes to the Financial Statements for the six month period ended 31 March 2023

1. General

2. Accounting Policies

Basis of preparation

Comparative figures

3. Critical accounting estimates and judgments

4. Significant accounting policies

5. Administrative fee and other expenses

6. Trade and other receivables

7. Creditors: Amounts falling due within one year

8. Creditors: Amounts falling after one year

9. Loss per share

10. Related party transactions

11. Events after the reporting date

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Name of entity

ABN

Quarter ended (“current quarter”)

Consolidated statement of cash flows

Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts

Payments to related parties of the entity and their associates

Financing facilities Note: the term “facility’ includes all forms of financing arrangements available to the entity.

Add notes as necessary for an understanding of the sources of finance available to the entity.

Estimated cash available for future operating activities

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Mining exploration entity or oil and gas exploration entity
quarterly cash flow report

Reconciliation of cash and cash equivalents
at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts

Financing facilities
Note: the term “facility’ includes all forms of financing arrangements available to the entity.