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Cadence Minerals #KDNC – European Metals Holdings #EMH – Cinovec Project Update
Cadence Minerals (AIM: KDNC; OTC: KDNCY) is pleased to note the announcement by European Metals Holdings Limited (“European Metals” or “EMH”) (ASX & AIM: EMH, OTCQX: EMHXY, ERPNF and EMHLF) in regard to the Cinovec Lithium Project (“Cinovec” or the “Project”).
Geomet (“Geomet”), 49% owned by European Metals and the owner of 100% of the Cinovec Project in the Czech Republic, is in the process of completing the Project Definitive Feasibility Study (“DFS”). DRA Global Limited (“DRA”) was appointed to complete the DFS in February 2023.
EMH has previously advised in the announcement to the market on 22 December 2023 that the delivery of the DFS for the Project had been pushed back and was expected to be completed in Q1 2024.
As a result of the engineering work and social and environmental engagement work subsequently performed as part of the DFS process, several material matters have been highlighted that may significantly improve the lithium processing component of the DFS.
The Geomet management team, in conjunction with DRA, is reviewing these matters. The Company expects to make a further announcement before the end of April 2024 detailing some of the more significant issues. Further, the Company reiterates that the process flowsheet remains as announced on 31 October 2022 and confirmed in pilot testing results announced on 9 November 2023. This review process could significantly improve the economic and social/community outcomes. Geomet considers this to be an important development in the Project and makes a further delay in the DFS well justified.
Importantly, as previously reported, the Company does not expect that the extension of the study period will impact the overall Project timeline, with the permitting process expected to be effectively coordinated pursuant to the enactment of the European Union’s Critical Raw Materials Act.
In other matters concerning the DFS Process, EMH is pleased to announce that previously published physical and hydrometallurgical process flowsheets have been confirmed to be viable for engineering and construction purposes with high levels of lithium recovery from run-of-mine ore to battery-grade end-products.
As previously noted, engineering test work programmes continue to improve process outcomes in various stages of both the physical and hydrometallurgical processing, and current test work programmes include:
- Gangue removal from zinnwaldite concentrate to enable a higher-grade roast mix to be processed by the rotary kilns, thus maximising the throughput of lithium units in the roasting without an increase in the size of the plant;
- recycling and regeneration of reagents in both the roasting and hydrometallurgical stages to reduce the consumption of fresh reagents and decrease opex per tonne of end-product, and
- simplification of precipitation/crystallisation processes to reduce energy and water costs, aiming at producing end-products with the lowest economic carbon footprint.
Executive Chairman, Keith Coughlan, commented on the update: “Whilst it is unfortunate not to be able to provide a fully completed DFS at this stage, I am confident that the developments currently being finalised will add significantly to the Project. In particular, permitting and timelines are expected to be positively impacted by the team’s additional work. The Cinovec Project remains an important part of the drive to improve critical materials security in the EU.”
Link here to view the full EMH announcement
Cinovec Lithium/Tin Project
Geomet s.r.o. controls the mineral exploration licenses awarded by the Czech State over the Cinovec Lithium/Tin Project. Geomet has been granted a preliminary mining permit by the Ministry of Environment and the Ministry of Industry. The company is owned 49% by EMH and 51% by CEZ a.s. through its wholly owned subsidiary, SDAS. Cinovec hosts a globally significant hard rock lithium deposit with a total Measured Mineral Resource of 53.3Mt at 0.48% Li2O and 0.08% Sn, Indicated Mineral Resource of 360.2Mt at 0.44% Li2O and 0.05% Sn and an Inferred Mineral Resource of 294.7Mt at 0.39% Li2O and 0.05% Sn containing a combined 7.39 million tonnes Lithium Carbonate Equivalent and 335.1kt of tin.
Cadence Minerals holds approximately 4.9% percent of the equity in European Metals Holdings.
| For further information contact:
|
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| Cadence Minerals plc | +44 (0) 20 3582 6636 |
| Andrew Suckling | |
| Kiran Morzaria | |
| WH Ireland Limited (NOMAD & Broker) | +44 (0) 20 7220 1666 |
| James Joyce | |
| Darshan Patel | |
| Fortified Securities – Joint Broker | +44 (0) 20 3411 7773 |
| Guy Wheatley | |
| Brand Communications | +44 (0) 7976 431608 |
| Public & Investor Relations | |
| Alan Green |
Cadence Minerals #KDNC – European Metals Announcement: Just Transition Fund Approves Cinovec Project
Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the announcement by European Metals Holdings Limited (ASX & AIM: EMH, OTCQX: EMHXY, ERPNF and EMHLF) that the Cinovec Project has been classified as a Strategic Project for the Usti Region of the Czech Republic. The list of Strategic Projects has been approved by the European Commission, the Czech Central Government and the Czech Regional Goverment in Usti. Being classified as such means that the Cinovec Project has priority for grant funding from the Just Transition Fund (“JTF“) co-funding, ahead of many other projects that have been submitted.
The total amount allocated by the Just Transition fund for the Czech Republic is CZK 41B (€1.64B) of which the Usti region has been allocated CZK 15.8B (approx. €632M).
The first call for grant applications under the JTF opened on 14 November 2022 and closes on 31 December 2023.
Given the total amount which may be applied for by the eleven designated Strategic Projects in the Usti region in the first call is CZK 8.3B (approx €350M) and that the funds allocated in this first call from the Just Transition Fund to these Strategic Projects totals CZK7.3B (approx €300M), although there can be no certainty, the Company is confident that Cinovec will receive a significant portion of the funds applied for from the JTF for the Project.
The maximum funding to be made available upon application to each Strategic Project in the Usti Region is CZK 1.2bn (approx €49M). The Cinovec Project has been allocated the maximum possible JTF grant of CZK 1.2B (approx €49M), subject to passing through the application process, funds remaining available and obtaining the necessary permits for the early-stage Cinovec work programmes to which this grant funding is planned to be applied to, in particular the early full development of the twin decline entry/egress system for the mine.
Accordingly, *Geomet s.r.o (the Cinovec project company) will apply for JTF Grant funding for the maximum amount of CZK 1.2B (approx €49M).
EMH Executive Chairman Keith Coughlan said:
“I am very pleased that the European Union via the Just Transition Fund has approved the Cinovec Project as a Strategic Project for the Usti Region of the Czech Republic. This approval provides further evidence of strong support from the Czech Government and the European Union and the Europe-wide recognition of the critical part which the Cinovec Project will play in enabling the EU to reach its stated goals of lithium self-sufficiency by 2030.”
“The proposed grants from the Just Transition Fund could play an important part in accelerating the development of the Cinovec Project. For example, the initial entry into the deposit via twin declines and ancillary road network at the proposed Dukla site are likely to be early-stage beneficiaries of this funding. This could reduce the time until first ore is produced by the Cinovec Project post final investment decision. As the funding is in the form of a non-repayable grant this could also have the additional benefit of not diluting the existing shareholders of the Company.”
“European Metals is well positioned for the rising demand in battery materials, developing the Cinovec project, the largest hard rock lithium project in the EU, which is centrally located on the Czech Republic’s border with Germany. The project possesses excellent ESG credentials which will enable the production of battery grade lithium hydroxide and carbonate with potentially one of the lowest CO2 emissions, globally.”
Link here to view the full EMH announcement
*Geomet s.r.o. controls the mineral exploration licenses awarded by the Czech State over the Cinovec Lithium/Tin Project. Geomet has been granted a preliminary mining permit by the Ministry of Environment and the Ministry of Industry. The company is owned 49% by EMH and 51% by CEZ a.s. through its wholly owned subsidiary, SDAS. Headquartered in the Czech Republic, CEZ a.s. is an established, integrated energy group with operations in a number of Central and South-eastern European countries and Turkey.
Cadence Minerals holds approximately 7.2% percent of the equity in European Metals Holdings.
| For further information contact:
|
|
| Cadence Minerals plc | +44 (0) 20 3582 6636 |
| Andrew Suckling | |
| Kiran Morzaria | |
| WH Ireland Limited (NOMAD & Broker) | +44 (0) 207 220 1666 |
| James Joyce | |
| Darshan Patel |
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Qualified Person
Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.
Forward-Looking Statements:
Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ”believe” ”could” “should” ”envisage” ”estimate” ”intend” ”may” ”plan” ”will” or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.
Cadence Minerals #KDNC – European Metals (AIM: EMH) – Funding Arrangement & Potential Strategic Partnership With CEZ.
Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to note the announcement published today by European Metals Holdings Limited (“European Metals” or “EMH”) that CEZ Group (“CEZ”), one of Central and Eastern Europe’s largest power utilities, has today conditionally agreed to provide a EUR 2 million finance facility by way of a convertible loan. CEZ is currently conducting due diligence on the European Metals and the Cinovec Lithium/Tin Project (“Cinovec”). The successful outcome of the due diligence process could see CEZ become European Metals’ largest shareholder and co-development partner for the Cinovec Project through conversion of the convertible note and subsequent additional investment.
Headquartered in the Czech Republic, CEZ is an established, integrated energy group with operations in a number of Central and Southeastern European countries and Turkey. CEZ’s core business is the generation, distribution, trade in, and sales of electricity and heat, trade in and sales of natural gas, and coal extraction. CEZ Group has 31,400 employees and annual revenue of approximately AUD 12 billion.
The largest shareholder of its parent company, CEZ a. s., is the Ministry of Finance of the Czech Republic with a stake of approximately 70%. The shares of CEZ a.s. are traded on the Prague and Warsaw stock exchanges and included in the PX and WIG-CEE exchange indices.
As one of the leading Central European power companies, CEZ intends to develop energy storage projects in the Czech Republic and in Central Europe which include energy storage and charging infrastructure and electricity supply, for users of electric vehicles.
Cadence holds approximately 19.1 percent of the equity in European Metals, which, through its wholly owned Subsidiary, Geomet s.r.o. (“Geomet”), controls the mineral exploration licenses awarded by the Czech State over Cinovec.
Funding Facility
The funding facility takes the form of a convertible loan (“Loan”). The key terms of the Loan are as follows:
- Principal amount: EUR 2 million.
- Maturity date: 31 December 2019.
- Interest rate: 7.5% per annum compounded annually.
- Conditions to Loan: The drawdown of the principal amount is subject to certain conditions, including entry into a pledge agreement (see below), and execution of a letter of intent pursuant to which the Company will, subject to applicable regulatory restrictions or the rules of any relevant stock exchange, grant exclusivity to CEZ until 31 December 2019 to carry out due diligence on the Company in respect of a potential acquisition of an interest in the Cinovec Project and/or Geomet.
- Use of funds: The Company shall use the Loan for the purposes of development of the Project.
- Conversion terms:
- CEZ may elect to convert the principal amount to shares in the Company at any time up to and including the maturity date or in the case of an event of default by the Company or if there is a further financing of the Company.
- Any conversion shares will be issued at the lower of EUR 0.24305337 (the volume weighted average price on AIM for the month of May 2019 converted to euros) and the actual share price at the time of conversion.
- The number of conversion shares will be limited such that, inter alia, CEZ will not as a result hold a stake in the Company that would require CEZ to make a mandatory offer for the entire issued share capital of the Company or otherwise require the Company to seek shareholder approval for the purposes of the Australian Securities Exchange Listing Rule 7.1.
- Security: As a condition precedent to the provision of the Loan, the parties intend to enter into a pledge agreement in order to secure the obligations of the Company under the Loan agreement, subject to applicable regulatory restrictions or the rules of any relevant stock exchange. Such obligations will be secured for the benefit of CEZ up to EUR 3,000,000 by a pledge over the 76% ownership interest of European Metals (UK) Limited (“EMH UK”) in GEOMET s.r.o. (“Geomet”), including a related negative pledge and prohibition of transferring and/or encumbering any of the 76% ownership interest of EMH UK in Geomet as well as the 24% ownership interest of EMH UK in Geomet.
- Further financing: During the term of the Loan agreement, CEZ has the opportunity to participate in any further new equity and / or debt financing of the Company, subject to certain restrictions.
- Representations, warranties and covenants: The Company has given CEZ certain customary representations and warranties with respect to the Company and its subsidiaries. The Company also covenants, subject to certain exceptions, not to allow a change of control of EMH, EMH UK or Geomet, not to pay or declare any dividends, not to grant security over the group and not to merge, liquidate or cease operations of EMH, EMH UK or Geomet.
- The Loan agreement is legally binding on the parties and is subject to English law.
The full release can be found at: https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/EMH/14150225.html
Cadence CEO Kiran Morzaria commented:“That EMH are now in advanced discussions with utility giant CEZ as funding and development partners once again confirms the Cinovec project status as a key future battery grade lithium supplier to the European lithium market. Today’s announcement also provides further validation of our investment strategy into EMH, and we look forward to further developments.”
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For further information:
| Cadence Minerals plc | +44 (0) 207 440 0647 |
| Andrew Suckling | |
| Kiran Morzaria | |
| WH Ireland Limited (NOMAD & Broker) | +44 (0) 207 220 1666 |
| James Joyce | |
| James Sinclair-Ford | |
| Novum Securities Limited (Joint Broker) | +44 (0) 207 399 9400 |
| Jon Belliss |
Qualified Person
Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.
Forward-LookingStatements:
Certain statements in this announcement are or may be deemed to be forward-lookingstatements. Forward-lookingstatements are identified by their use of terms and phrases such as ‘‘believe’’ ‘‘could’’ “should” ‘‘envisage’’ ‘‘estimate’’ ‘‘intend’’ ‘‘may’’ ‘‘plan’’ ‘‘will’’ or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-lookingstatements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on keypersonnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions.The Company cannot assure investors that actual results will be consistent with such forward-lookingstatements