TIDMKDNC
RNS Number : 9921Y
Cadence Minerals PLC
19 January 2022
Cadence Minerals Plc
("Cadence Minerals" or "Cadence")
European Metals (AIM: EMH) Cinovec PFS Update Delivers
Outstanding Results .
Cadence Minerals (AIM/AQX: KDNC; OTC: KDNCY) is pleased to note
that European Metals Holdings Limited ("European Metals" "EMH") has
announced the results of the mining update to the 2019
Pre-Feasibility Study (2022 PFS Update), led by mining definitive
feasibility study (DFS) consultant Bara Consulting, on the
backfilling potential of the Cinovec mine, in which it has a 49%
economic interest, in the Czech Republic.
Highlights
-- The 2019 PFS Update for the Cinovec Project has been updated
to demonstrate the effect of changes in the mining process to
incorporate the use of paste backfill, which results in an increase
in annual production, together with changes in lithium and
by-product prices to reflect current and expected market
conditions.
-- Annual production of battery grade lithium hydroxide
monohydrate modelled to increase from 25,267 tpa to 29,386 tpa, an
increase of 16%.
-- NPV8 (post tax) increases from US$1.108B to US$1.938B, an
increase of 74.9%, based upon a lithium hydroxide price of
USD17,000 per tonne which is significantly less than the current
price.
-- NPV8 (post tax) increases to over USD 3.09B with a 30%
increase in the lithium hydroxide price.
-- Post tax IRR of 36.3% and a payback period of 2.5 years from
the commencement of production.
-- Up-front capital cost due to backfilling plant and additional
capital costs to produce 29,386 tpa lithium hydroxide increased to
US$644m.
-- This 2022 PFS Update assumes the life of mine extraction of
13.1% of the Measured and Indicated JORC Resources at Cinovec.
-- Use of tailings for backfill will result in a far smaller
environmental impact, further enhancing the Project's already
strong ESG credentials.
The study updates the outcomes of the previously updated
pre-feasibility study announced on 17 June 2019 (2019 PFS Update),
for changes in the mining process as well as an increase in annual
production and changes in lithium and by-product prices.
As a result of the conclusions of the study, Geomet s.r.o.
(Geomet) has changed the planned mining method for the Cinovec
orebody from open stoping to longhole stoping with backfill using
paste backfill. This change, together with other changes to the
material assumptions outlined in this update, increases the Cinovec
mine's proposed ore extraction from 34.5mt up to 54.5mt, enabling
an increase in the annual processing rate by approximately 33% per
annum over the previous 21-year life of mine, from 1.69mtpa to
2.25mtpa over a now 25-year life of mine.
Link here for the full EMH announcement:
https://www.londonstockexchange.com/news-article/EMH/pfs-update-delivers-outstanding-results/15293716
European Metals Executive Chairman Keith Coughlan commented; " I
am very pleased to report to shareholders on the completion of this
2022 PFS Update for the Cinovec Project which adds significantly to
the already robust forecast economics for the project. The results
of the study are very positive for the overall economics, resulting
in a far greater amount of the ore resource being utilised for
production of lithium and increasing the after tax NPV8 from
USD1.1B to USD1.94B. The increased NPV assumes a long-term price
for lithium hydroxide of US$17,000 per tonne. An increase in the
lithium hydroxide price to USD 22,100 would increase the NPV8 (post
tax) to over USD 3BN. Given the current price of lithium hydroxide
is in the vicinity of USD 40,000 per tonne it is clear that that
the Cinovec Project will be critical to European battery
self-sufficiency.
"The use of approximately 54% of the plant tailings for backfill
will result in a far smaller environmental impact, with much
smaller dry stack tailings storage required, further enhancing the
already strong ESG credentials of the Project.
"The significant increase in lithium produced will further add
to the supply security of the European battery industry.
Importantly, even at this increased production rate, the resource
is nowhere near fully utilised - paving the way for future
assessment of further production increases.
"Cinovec is strategically located in central Europe, in close
proximity to the continent's vehicle manufacturers. With increasing
demand for electric vehicles and the expected demands of grid
storage capacity, the project is very well placed to supply the
European lithium market for many decades."
Cadence CEO Kiran Morzaria added; "Our congratulations to Keith
Coughlan and the European Metals team on an outstanding result at
Cinovec. An increased mine life and a resource upgrade that takes
the NPV8 from USD1.1bn to USD1.94bn adds substantial value to
Cinovec's already exceptional potential as a future battery grade
lithium supply hub for Europe and the rest of the world."
"Cadence are pleased to remain shareholders and supporters of
EMH, and we look forward to further developments."
Cadence Minerals Holding in EMH following placing
In a separate announcement today, EMH stated that it had
conducted a Placement at A$1.40 per CDI to raise approximately
A$14.4 million. The Placement issue price represents a 0.7% premium
to the Company's last traded price on 18 January 2022 (A$1.39).
Following the placing, Cadence will hold approximately 8.7% 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.
Link here for the full EMH placing announcement:
https://www.londonstockexchange.com/news-article/EMH/successful-placing-to-raise-aud14-4m/15293733
- Ends -
For further information:
Cadence Minerals plc +44 (0) 7879 584153
Andrew Suckling
Kiran Morzaria
WH Ireland Limited (NOMAD & Broker) +44 (0) 207 220 1666
James Joyce
Darshan Patel
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-Looking Statements:
Certain statements in this announcement are or may be deemed to
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identi ed by their use of terms and phrases such as "believe"
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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
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 forward-looking statements.
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