HIGHLIGHTS FROM AND SUBSEQUENT TO THE QUARTER
· In July 2023, GreenX entered into an Option Agreement with Greenfields Exploration Limited to acquire up to 100% of the Eleanore North gold project (Eleanore North) in eastern Greenland.
o Eleonore North has the potential to host a “reduced intrusion-related gold system” (RIRGS), analogous to large bulk-tonnage deposit types found in Canada.
o Option to earn 100% of the Project vests upon GreenX spending A$600,000 on exploration on the Project within 12 months and can be exercised in return for a 1.5% Net Smelter Royalty plus A$250,000 payable in cash and A$250,000 payable in either cash or GreenX shares at GreenX’s election.
o Transaction provides GreenX with gold exposure in Greenland and complements GreenX’s existing exploration prospect in Greenland, the Arctic Rift Copper project (ARC).
· In November 2022, the hearing for the Claim 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 Tribunal in London under the UNCITRAL Arbitration Rules
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
· Subsequent to the quarter, GreenX completed a Placing to issue 5.2 million new ordinary shares to raise gross proceeds of approximately A$4.2 million (~£2.1 million) from new and existing investors (Placing). The next proceeds from the Placing will be used for exploration activities at the Company’s projects in Greenland.
· Cash balance as at 30 June 2023 and prior to the Placing was A$8.7 million.
Classification: 3.1 Additional regulated information required to be disclosed under the laws of a Member State
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 30 June 2023.
ELEANORE NORTH GOLD PROJECT OPTION ACQUISITION
In July 2023, GreenX entered into an Option Agreement (Agreement) with Greenfields Exploration Limited to acquire up to 100% of the Eleanore North gold project in eastern Greenland.
Eleonore North has the potential to host a “reduced intrusion-related gold system” (RIRGS), analogous to large bulk-tonnage deposit types found in Canada including Donlin Creek, Fort Knox and Dublin Gulch.
Gold mineralisation documented at the high-priority Noa Pluton prospect within Eleonore North.
· Geophysical “bullseye” anomaly 6 km wide co-incident with elevated gold mineralisation from historical geochemical sampling.
· Anomalous gold mineralisation associated with quartz veining exposed at surface over a length of up to 15 km.
· Historical sampling includes 4 m chip sample grading 1.93 g/t Au and 1.9% Sb (refer to Appendix 1 of the Company’s announcement on 10th July 2023).
Eleonore North has potential to host large scale, shallow, bulk tonnage gold deposits. The Project remains underexplored, with the existence of a possible RIRGS being a relatively new geological interpretation based on the historical data. Initial field work consists of a seismic survey to determine the depth from surface to the Noa Pluton to aid in drill targeting.
Eleonore North license area contains other gold targets as well as copper, antimony and tungsten prospects. At Holmesø there is copper and antimony mineralisation outcropping at surface. Historical mapping and sampling in the 1970s at Holmesø show a prospective horizon between 15 m and 20 m thick, with per cent level grades for both metals.
Option to earn 100% of the Project vests upon GreenX spending A$600,000 on exploration on the Project within 12 months and can be exercised in return for a 1.5% Net Smelter Royalty plus A$250,000 payable in cash and A$250,000 payable in either cash or GreenX shares at GreenX’s election.
Transaction provides GreenX with gold exposure in Greenland and complements GreenX’s existing exploration prospect in Greenland, the Arctic Rift Copper project (ARC). There are significant synergies with regards to personnel, logistics and equipment in having multiple exploration projects in Greenland. Field works for the 2023 have already commenced at Eleonore North, with follow-on exploration field activities for the ARC project currently being planned.
Greenland is a mining friendly jurisdiction with strong Government support for expanding its mining industry, simple laws and regulations, and a competitive fiscal regime.
The primary target in Eleonore North is the Noa Pluton, followed by the Holmesø prospect and its source intrusion. The Noa Veins provide a near-term drill target, however, the Company plans to determine the depth of the intrusion with greater precision using a passive seismic survey. This information will validate the magnetic interpretation, provide more certainty for a future drilling program, and help identify the size of the intrusion within the well-defined hornfels.
ARCTIC RIFT COPPER PROJECT
The Arctic Rift Copper Project (ARC) is an exploration joint venture between GreenX and Greenfields Exploration Ltd (Greenfields). GreenX can earn 80% of ARC by spending A$10 million by October 2026. ARC is targeting large scale copper in multiple settings across a 5,774 km2 Special Exploration Licence in eastern North Greenland. The area has been historically underexplored yet is prospective for copper, forming part of the newly identified Kiffaanngissuseq metallogenic province.
The results of work program announced last year 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 information is underway and will be key to future planned work programs.
DISPUTE WITH POLISH GOVERNMENT
In November 2022, the Company reported the conclusion of the 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 and lasted two weeks.
Following completion of the hearing, the 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 LFA for US$12.3 million with LCM. US$10.4 million of the facility has been drawn down to cover legal, tribunal and external expert costs as well as defined operating expenses associated with the Claim. The Company does not anticipate further material drawdowns now that funded costs relating to the claims have been dispersed. 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.
SHARE PLACING
In July 2023, the Company announced that it had successfully completed a bookbuild and secured commitments for 5.2 million new ordinary shares at a price of A$0.80 (41 pence) per share for gross proceeds of approximately A$4.2 million (~£2.1 million) from new and existing investors.
Together with the Company’s existing cash resources (A$8.7 million as at 30 June 2023), the proceeds of the Placing will help ensure that GreenX retains a strong balance sheet position.
The net proceeds from the Placing will be used for exploration activities at the company’s projects in Greenland.
CORPORATE
Financial Position
Prior to the successful completion of the Placing, GreenX had cash of A$8.7 million as at 30 June 2023.