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Sovereign Metals #SVML – Spiral Plant Successfully Installed
Sovereign Metals Limited (ASX: SVM; AIM: SVML; OTCQX: SVMLF) (Sovereign or the Company) is pleased to announcethat it has successfully installed and commissioned an industrial-scale spiral concentrator plant at the Company’s laboratory and testing facility in Lilongwe, Malawi.
The plant enables Sovereign to process material from the test pit mined as part of the Pilot Mining and Land Rehabilitation (Pilot Phase) at its Kasiya Rutile-Graphite Project (Kasiya or Project).
Highlights:
- Industrial scale spiral concentrator plant successfully installed and commissioned at Sovereign’s expanded laboratory and testing facility in Lilongwe, Malawi
- Graphite pre-concentrate from spiral plant will facilitate ongoing testwork and offtake discussions with lithium-ion battery makers and traditional graphite markets
- Spiral plant commissioning commenced with material from the Pilot Phase test pit being processed at a throughput rate of up to 3 tonnes per hour for continuous sample preparation
- The spiral installed and commissioned is the identical model selected for the Wet Concentrator Plant per the simple 2023 Kasiya pre-feasibility study (PFS) process flowsheet
- Commissioning and subsequent use of spiral plant also provides Malawian employee training in industrial scale processing prior to full-scale operations
- Sovereign is targeting a market-leading position as the world’s largest and lowest-cost producer of rutile for the titanium industry and flake graphite for the lithium-ion battery market
Managing Director Frank Eagar commented: “The new infrastructure allows Sovereign to deliver large-scale graphite pre-concentrate for qualification by its future potential customers. With a simple and conventional process flowsheet, Kasiya ore is processed at a throughput rate of up to 3 tonnes per hour for continuous sample preparation. Our PFS optimisation continues to advance as planned with oversight from the Sovereign-Rio Tinto Technical Committee.“
The spiral plant will prepare a graphite gravity concentrate from the Pilot Phase test pit’s run of mine at a bulk scale. The concentrate will then be sent to specialised laboratories where flotation, purification, spheronisation and coating testwork for the battery anode segment in line with Sovereign’s strategy to commercialise Kasiya’s graphite by-product.
This follows the Company’s recent announcement that downstream testwork performed by a leading independent consultancy had demonstrated that Coated Spherical Purified Graphite (CSPG) produced from Kasiya natural flake graphite has performance characteristics comparable to leading Chinese natural graphite anode materials manufacturers (See Company Announcement dated 4 September 2024).
Graphite concentrate will also be provided to traditional industrial graphite users, including refractories, foundries, expandable graphite, graphite foil, brake lining pads, and lubrication.
Figure 1: Installed Spiral plant at Sovereign’s Lilongwe facility
Figure 2: Commencement of spiral commissioning
Kasiya Process Flowsheet
The Kasiya process flowsheet is separated into distinct simple processing areas.
Wet Concentrator Plant (WCP)
The WCP will receive mined material pre-screened at 2mm to remove oversize. Simple gravity separation through spirals will produce a Heavy Mineral Concentrate (HMC) and a separate gravity tailings stream enriched in graphite. The spiral installed and commissioned is the identical model selected for the Wet Concentrator Plant per the 2023 Kasiya PFS process flowsheet. It will have the same throughput capacity as a spiral in the designed plant.
Mineral Separation Plant (MSP)
At the MSP, the HMC will initially undergo electrostatic separation to separate heavy minerals into electrically conductive minerals including rutile, and non-conductive minerals. Magnetic separation will then isolate rutile, which is non-magnetic, from other conductive minerals. Sovereign recently installed and is commissioning a CoronaStat Electric Separator at its facility in Lilongwe. This unit has been supplied by OreKinetics Pty Ltd which has also supplied the majority of electrostatic separators to the mineral sands industry over the last 20 years.
Figure 3: CoronaStat Electric Separator at Sovereign’s Lilongwe facility clearly showing non-conductive material on left-hand-side and conductive minerals including rutile on right-hand-side
Figure 4: Bench-scale magnetic separator at Sovereign’s Lilongwe facility separating non-magnetic rutile from other conductive minerals
Graphite Plant
The graphite tailings stream collected from the gravity spirals will be processed through froth flotation, including polishing and stirred media mills, producing a coarse-flake graphite concentrate and tailings.
Tailings storage and management will be further refined as part of the ongoing Kasiya PFS Optimisation Study.
ENQUIRIES
Frank Eagar (South Africa/Malawi)
CEO & Managing Director
+27 21 065 1890
Sapan Ghai (London)
CCO
+44 207 478 3900
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Nominated Adviser on AIM and Joint Broker |
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SP Angel Corporate Finance LLP |
+44 20 3470 0470 |
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Ewan Leggat Charlie Bouverat |
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Joint Brokers |
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Stifel |
+44 20 7710 7600 |
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Varun Talwar |
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Ashton Clanfield |
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Berenberg |
+44 20 3207 7800 |
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Matthew Armitt |
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Jennifer Lee |
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Buchanan |
+ 44 20 7466 5000 |
Sovereign Metals #SVML – Quarterly report for the period ended 30 June 2024
Sovereign Metals Limited (Company or Sovereign) (ASX:SVM & AIM:SVML) is pleased to provide its quarterly report for the period ended 30 June 2024.
HIGHLIGHTS
Rio Tinto Invests Additional A$18.5m via Option Exercise
· In July 2024, Rio Tinto invested a further A$18.5 million via the exercise of options, to increase its shareholding in Sovereign to 19.76%
· Investment proceeds to be used to continue advancing the Kasiya Rutile-Graphite Project in Malawi
· Rio Tinto’s further investment represents another significant step towards unlocking a major new supply of low-CO2-footprint natural rutile and flake graphite. Under the Investment Agreement between Sovereign and Rio Tinto, Rio Tinto continues to provide assistance and advice on technical and marketing aspects of Kasiya
· Following the additional A$18.5 million invested by Rio Tinto, Sovereign remains in strong financial position with cash at bank of approximately A$50.0 million and no debt
Mining Development Agreement signed by the Malawi Government
· In July 2024, Sovereign notes that Mkango Resources Limited (Mkango) signed a Mining Development Agreement with the Malawi Government on terms similar to assumptions used in the Company’s Pre-Feasibility Study
· Mkango announced that the Malawi Government would receive a 5% royalty of gross revenues and 10% non-diluting equity interest in the project, while Mkango will be exempt from customs and excise duties and pay a 30% corporate tax rate
Kasiya Optimisation Advances to Pilot Phase
· During the quarter, Sovereign commenced a pilot mining and land rehabilitation program (Pilot Phase) at Kasiya as part of the ongoing PFS Optimisation Study
· At the end of July 2024, the dry mining component of the Pilot Phase was successfully completed, confirming Kasiya can be efficiently mined using standard mobile excavators and trucks, demonstrating operational alternatives as part of ongoing PFS Optimisation Study
· Test pit mined as planned and on schedule to a depth of 20 metres, excavating approximately 170,000 bench cubic metres
· Empirical data generated from the Pilot Phase will assist towards determining optimal excavation, material handling, processing, backfilling and rehabilitation approaches
· Demonstrates strong support for mining projects in Malawi with all required approvals and community permissions for the Pilot Phase obtained within three months
· The test pit will be backfilled, and multiple rehabilitation strategies will be implemented to demonstrate successful restoration of agricultural land
· Excavated material will be processed through cyclones on-site for tailings deposition testwork as well as at Sovereign’s laboratory in Malawi to generate additional bulk samples for graphite product qualification
Downstream Testwork Demonstrates High-Quality Graphite for Lithium-Ion Batteries
· During the quarter, Spherical Purified Graphite (SPG) with world-leading specifications successfully produced from Kasiya demonstrating all required parameters within industry standards with spheronisation yields of up to 68% with further scope to optimise in future testwork
· Kasiya’s spherical purified graphite (SPG) showed exceptionally low levels of residual impurities achieving a 99.99% loss-on-ignition (LOI)
· Testwork was undertaken as part of the Company’s graphite strategy to qualify and commercialise graphite concentrate for use in the lithium-ion battery sector
Testwork Delivers Superior Quality, Low Impurity Graphite for Battery Anodes
· During the quarter, graphite circuit feed prepared at Sovereign’s existing Lilongwe laboratory facility has produced high quality concentrates in benchtop and pilot-scale flotation and cleaning
· Four independent laboratories all successfully produced high-grade graphite concentrate averaging over 97% Total Graphite Content (TGC) with flotation recoveries exceeding 90%
· Flotation results demonstrated 1.44% TGC run-of-mine Kasiya ore upgrades to more than 55% TGC rougher concentrate without crushing or milling; process steps typically required for producing graphite concentrates from hard-rock deposits; contributing to the unique low cost characteristics of Kasiya’s saprolite hosted graphite
· Graphite concentrates show exceptionally low levels of sulphur compared to typical hard-rock graphite peers – a key metric to qualify as active anode material for lithium-ion batteries
· Results are part of ongoing testwork being undertaken as part of the Company’s graphite marketing and active anode qualification strategy, supervised by Dr Surinder Ghag
Commencement of Trading on OTCQX Markets
· Subsequent to the quarter, Sovereign upgraded to the OTCQX Market, the top tier of the OTC Markets, providing access to a broader eligible U.S. investor base
· OTCQX quotation follows increased U.S. investor and strategic interest in Sovereign and its Kasiya Rutile-Graphite Project in Malawi
Partnering with International Development Organisation in Malawi
· During the quarter, Sovereign has entered into an MoU with The Palladium Group – a US-based international development entity operating in Malawi
· Palladium implements several development projects, including the Feed the Future Malawi Growth Poles Project, which invests in local rural communities to advance sustainable, climate-smart, and inclusive wealth creation
· Sovereign and Palladium will collaborate around Sovereign’s Kasiya Project to provide key agricultural inputs, training, technologies, and financing to develop and integrate smallholder farmers into the emerging high growth agriculture value chains
Classification 2.2: This announcement includes Inside Information
ENQUIRIES
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Mr Frank Eagar (South Africa/Malawi) +27 21 065 1890 |
Sam Cordin (Perth) |
Sapan Ghai (London)
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Nominated Adviser on AIM and Joint Broker |
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SP Angel Corporate Finance LLP |
+44 20 3470 0470 |
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Ewan Leggat Charlie Bouverat |
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Joint Brokers |
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Stifel |
+44 20 7710 7600 |
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Varun Talwar |
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Ashton Clanfield |
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Berenberg |
+44 20 3207 7800 |
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Matthew Armitt |
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Jennifer Lee |
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Buchanan |
+ 44 20 7466 5000 |
Sovereign Metals #SVML – Rio Tinto To Invest Additional A$18.5m via Option Exercise
Sovereign Metals Limited (ASX: SVM; AIM: SVML) (Sovereign or the Company) is pleased to announce that Rio Tinto Mining and Exploration Limited (Rio Tinto) has notified the Company that it has exercised all its share options to increase its shareholding in Sovereign to 19.76%.
Highlights:
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Rio Tinto to invest A$18.5 million via the exercise of options, to increase its shareholding in Sovereign to 19.76% |
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Investment proceeds to be used to continue advancing the Kasiya Rutile-Graphite Project in Malawi |
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Rio Tinto’s further investment represents another significant step towards unlocking a major new supply of low-CO2-footprint natural rutile and flake graphite |
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Under the Investment Agreement between Sovereign and Rio Tinto, Rio Tinto continues to provide assistance and advice on technical and marketing aspects of Kasiya |
Rio Tinto has exercised 34,549,598 share options to acquire the same number of new fully paid ordinary shares (Shares) in Sovereign at A$0.535 per Share for proceeds of A$18,484,035.
The Company will use the proceeds from Rio Tinto’s additional strategic investment to continue advancing Sovereign’s Tier 1 Kasiya Rutile-Graphite Project (Kasiya or the Project) in Malawi. This includes progressing the current optimisation study for Kasiya which is focused on the development of a world-class mine capable of supplying critical minerals to the titanium pigment, titanium metal and lithium-ion battery industries. Under the Investment Agreement between Sovereign and Rio Tinto, Rio Tinto continues to provide assistance and advice on technical and marketing aspects of Kasiya.
Funds from the option exercise are expected to be received by Friday, 5 July 2024.
Sovereign’s Chairman, Ben Stoikovich, commented: “Rio Tinto’s further investment in Sovereign reaffirms Kasiya’s position as one of the most significant critical minerals projects globally. With Rio Tinto’s wealth of experience as one of the world’s largest and most accomplished global mining companies, Kasiya is well-positioned to potentially become a market leader in low-CO2-footprint natural rutile and graphite.”
Sovereign’s Managing Director, Frank Eagar, commented: “In collaboration with Rio Tinto, we have made significant progress in advancing Kasiya over the course of this year, including the successful launch of the pilot phase mining in May. We are excited about Rio Tinto’s further investment in Sovereign, which represents another significant step towards unlocking a major new supply of low-CO2-footprint natural rutile and flake graphite.”
BACKGROUND TO RIO TINTO’S STRATEGIC INVESTMENT
In July 2023, Rio Tinto agreed to initially subscribe for and purchase 83,095,592 Shares in Sovereign at a price of A$0.486 per Share for aggregate proceeds of A$40.4 million. Rio Tinto’s initial subscription price reflected a 10% premium to the 45-day volume weighted average price on the ASX as at close on 14 July 2023 and resulted in Rio Tinto holding approximately 15% of the ordinary shares of the Company.
The subscription also involved Rio Tinto being granted options to acquire 34,549,598 further Shares in Sovereign within 12 months of the initial subscription.
Sovereign and Rio Tinto also entered into an Investment Agreement pursuant to which a joint technical committee has been established between Sovereign and Rio Tinto to advance the development of Kasiya. Please refer to the Company’s announcement on 17 July 2023 for further details.
For acting as financial advisor and subject to receipt of exercise funds, an advisory fee of 3% is payable to SCP Resource Finance (SCP) on the amount of Rio Tinto’s exercise of options investment and, subject to shareholder approval, can be paid by way of the issue of ordinary shares to SCP, with 1,036,488 shares being issuable to SCP. A notice of meeting (and explanatory statement) will be sent out to shareholders in the coming weeks.
ENQUIRIES
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Frank Eagar (South Africa/Malawi) +61(8) 9322 6322 |
Sam Cordin (Perth) +61(8) 9322 6322 |
Sapan Ghai (London) +44 207 478 3900
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Nominated Adviser on AIM and Joint Broker |
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SP Angel Corporate Finance LLP |
+44 20 3470 0470 |
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Ewan Leggat Charlie Bouverat |
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Joint Brokers |
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Stifel |
+44 20 7710 7600 |
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Varun Talwar |
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Ashton Clanfield |
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Berenberg |
+44 20 3207 7800 |
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Matthew Armitt |
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Jennifer Lee |
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Buchanan |
+ 44 20 7466 5000 |
The information contained within this announcement is deemed by Sovereign to constitute inside information as stipulated under the Regulation 2014/596/EU which is part of domestic law pursuant to the Market Abuse (Amendment) (EU Exit) Regulations (SI 2019/310) (“UK MAR”). By the publication of this announcement via a Regulatory Information Service, this inside information (as defined in UK MAR) is now considered to be in the public domain. The person responsible for arranging for the release of this announcement on behalf of Sovereign is Mr Dylan Browne (Company Secretary).
Admission
Subject to receipt of exercise funds, an application to AIM will be made for the 34,549,598 Shares to be admitted to trading on AIM (the AIM Admission). It is expected that AIM Admission will take place and dealings will commence on AIM on or around 8.00 a.m. on 12 July 2024.
Total Voting Rights
Immediately following the AIM Admission, the Company’s issued share capital will be 597,552,999 Shares, with each share carrying the right to one vote. The Company does not hold any Ordinary Shares in treasury. The total voting rights figure immediately following the AIM Admission of 597,552,999 may be used by shareholders (and others with notification obligations) as the denominator for the calculations by which they will determine whether they are required to notify their interest in, or a change to their interest in, the Company under the Disclosure Guidance and Transparency Rules.
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.