Cadence Minerals PLC Cadence completes to vest its 27% in Amapa Project
RNS Number : 8137E
Cadence Minerals PLC
15 March 2022
Cadence Minerals Plc
("Cadence Minerals", "Cadence" or "the Company")
Cadence formally completes Phase Two to vest its 27% in the
Amapa Iron Ore Project
Cadence Minerals (AIM/AQX: KDNC; OTC: KDNCY) is pleased to
report that further to the announcement of February 7th 2022 (link
here), all of the required contractual documentation has been
completed, and Cadence now has vested its 27% of the Amapa Iron Ore
Project ("Amapa Project" or "Amapa").
This second stage of investment was to acquire a further 7%
(US$3.5 million) of Pedra Branca Alliance ("PBA"), the Cadence and
IndoSino joint venture company which owns 100% of the equity of DEV
Mineração S.A. ("DEV"). DEV is the owner of the large-scale Amapa
Project. This second stage investment was conditional on several
preconditions, which have now been satisfied, and consequently
Cadence has now vested a further 7%.
Anglo American, a previous owner and 70% shareholder, (with
Cliffs owning the remaining 30%), valued the entire Amapa Project
at US$ 1.2 billion. In its 2012 Annual Accounts, Anglo American
impaired the entire Amapa project value to US$ 660 million.
Cadence CEO, Kiran Morzaria, commented: "I am pleased to report
that following the recent oversubscribed fundraising, we have
formally completed phase two of our investment into Amapa to
acquire 27%. I know our new and longstanding shareholders share our
vision for Amapa, and I am pleased to report that the mine
rehabilitation plan is progressing on schedule."
"I look forward to reporting back to you on further operational
progress in the coming weeks."
About the Amapa Project
The Amapa Project commenced operations in December 2007 with the
first production of iron ore concentrate product of 712 kt in 2008.
In 2008 Anglo American (70%) and Cliffs (30%) acquired the Amapa
Project in 2008 as part of a larger package of mining assets in
Production steadily increased to 4.8 Mt and 6.1 Mt of iron ore
concentrate product in 2011 and 2012. During this period, Anglo
American reported operating profits from its 70% ownership in the
Amapa Project of US$ 120 million (100% US$ 171 million) and US$ 54
million (100% US$ 77 million). Before its sale in 2012, Anglo
American valued its 70% stake in the Amapa Project at US$ 866
million (100% US$ 1.2 billion). It impaired the asset in its 2012
Annual Accounts to US$ 462 million (100% US$ 660 million.
Cadence updated the Mineral Resource Estimate on November 2nd
2020, increasing the MRE by 21%. The current MRE contains a Mineral
Resource of 176.7 million tonnes grading 39.7% Fe in the Indicated
category and Mineral Resource of 8.7Mt at 36.9% in the Inferred
category, both reported within an optimised pit shell and using a
cut-off grade of 25% Fe.
Details of Ownership and Joint Venture Agreement
Cadence owns 27% of the Amapa Project with our joint venture
partner, Indo Sino Pty Ltd ("Indo Sino") owning the remaining 73%.
The ownership of Amapa is via a joint venture company, Pedra Branca
Alliance Pte. Ltd. ("JV Co") which owns 100% of the equity of DEV
Mineração S.A. ("DEV"). Should Indo Sino seek further investors or
an investment in the JV Co, the Agreement also provides Cadence
with a first right of refusal to increase its stake to 49% in the
To acquire its 27% interest Cadence has invested US$6 million
over two stages. If Cadence is not able to exercise its right of
first refusal under the terms of the Agreement, Indo Sino will have
a twelve-month option to buy the shares in JV Co held by Cadence
for 1.5 times the price paid by Cadence for such shares.
The Agreement also contains security and default clauses which
if triggered causes an upwards adjustment mechanism to allow
Cadence to either receive cash from JV Co or receive additional
shares in JV Co. In the latter case, Cadence's shareholding in the
JV Co will not go above 49.9%.
- Ends -
For further information: Cadence Minerals plc +44 (0) 7879 584153
WH Ireland Limited (NOMAD
& Broker) +44 (0) 207 220 1666
Novum Securities Limited
(Joint Broker) +44 (0) 207 399 9400
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.
Certain statements in this announcement are or may be deemed to
be forward-looking statements. Forward-looking statements are
identi ed 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 Cadence
Minerals Plc'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 re ect
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 Cadence
Minerals Plc. Although any forward-looking statements contained in
this announcement are based upon what the Directors believe to be
reasonable assumptions. Cadence Minerals Plc cannot assure
investors that actual results will be consistent with such
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(END) Dow Jones Newswires
March 15, 2022 05:28 ET (09:28 GMT)
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