Savannah Resources PLC Mina do Barroso Lithium Project Update (3872A)
01 Junio 2021 - 1:00AM
UK Regulatory
TIDMSAV
RNS Number : 3872A
Savannah Resources PLC
01 June 2021
1 June 2021
Savannah Resources Plc
(AIM: SAV, FWB: SAV and SWB: SAV) ('Savannah' or the
'Company')
Mina do Barroso Lithium Project Update
Savannah to evaluate additional strategic opportunities due to
improved market conditions
Savannah, the resource development company focused on becoming
Europe's most significant producer of spodumene lithium concentrate
('Spodumene') from its Mina do Barroso Project in Portugal ('Mina
do Barroso', 'MdB' or the 'Project'), is pleased to announce
growing interest for offtake and strategic investments.
Highlights
-- This year's strong lithium market has resulted in the Company
receiving increasing interest from groups seeking to strategically
undertake investment in the Project or Savannah with or without
requiring a spodumene offtake. The interest reflects the increasing
appetite for exposure to the lithium value chain within the wider
investment community.
-- Amid this backdrop the Heads of Agreement ('HoA') with Galp
(announced on 12 January 2021) has now expired, and discussions in
relation to strategic investment and offtake will continue with
Galp outside of the exclusive terms of the HoA.
-- Meanwhile, Savannah intends to leverage this degree of
commercial interest in MdB to create a strong economic platform to
support the Project's development and to maximise shareholder
value. Savannah is now evaluating its many strategic options.
-- This process may include alternative or supplementary offtake
contracts, with or without investment from the offtaker(s) in
Savannah or the project directly. It may also result in strategic
investments in the Company independent of offtake, or the sale of a
portion of the Mina do Barroso Project.
-- Savannah's own financial position has been significantly
strengthened during the period following the execution of the
oversubscribed GBP10.3m fundraise in April 2021. This provides
Savannah with the opportunity to independently advance the
definitive feasibility study work at Mina do Barroso and add to its
lithium project portfolio.
-- Savannah intends to leverage this degree of commercial
interest in MdB to create a strong economic platform to support the
Project's development.
Savannah's CEO, David Archer said: "We are delighted with the
level of interest we are seeing in Mina do Barroso. The increased
commercial interest the Project is receiving reflects the rapid
change in the dynamic the lithium sector has been experiencing
since late 2020, with demand remaining robust despite the ongoing
COVID-19 situation. The previous inventory overhangs have been
consumed, current supplies of lithium raw material are largely
covered by existing offtake agreements and demand is expected to
grow multiple times over the next decade. This has resulted in
price rises in all lithium raw materials, including an increase of
approximately 80% in the spodumene concentrate price since the
start of the year. Put simply, the world needs new sources of
lithium - as demonstrated by the US$3.5 billion of equity
investments that have been made in the lithium sector year to date.
Nowhere is this truer than in Europe where the European Commission
and major consumers have expressed their desire to create an
end-to-end battery value chain in the region to ensure future
supply from responsibly managed, local, sources which will minimise
the carbon footprint attached to the lithium as it enters the value
chain.
"Alongside the ongoing technical and approval processes,
Savannah is looking to leverage the abundant interest in our
spodumene concentrate that we have been receiving in recent months
to secure the best commercial arrangements we can for the Project
and the Company's shareholders. This will ensure Mina do Barroso
has the necessary economic foundation and partners to attract the
finance needed to construct the Project once its design and
approval are finalised.
"Whilst the previously announced Heads of Agreement with Galp
has now expired, our commercial discussions will continue with
Galp. Savannah remains well funded and committed to the responsible
development of Mina do Barroso, creating jobs and sharing the
benefits of the Project with its stakeholders in Portugal while
providing a foundation for a new lithium value chain in the
country.
"I look forward to being able to update shareholders on these
expected positive developments in due course."
Regulatory Information
This Announcement contains inside information for the purposes
of the UK version of the market abuse regulation (EU No. 596/2014)
as it forms part of United Kingdom domestic law by virtue of the
European Union (Withdrawal) Act 2018 ("UK MAR").
**ENDS**
Follow @SavannahRes on Twitter
Follow Savannah Resources on LinkedIn
For further information please visit www.savannahresources.com
or contact:
Savannah Resources PLC Tel: +44 20 7117 2489
David Archer, CEO
SP Angel Corporate Finance LLP (Nominated Tel: +44 20 3470 0470
Advisor)
David Hignell / Charlie Bouverat
finnCap Ltd (Joint Broker) Tel: +44 20 7220 0500
Christopher Raggett/ Tim Redfern
WH Ireland Limited (Joint Broker) Tel: +44 20 7220 1698
James Joyce/ Jessica Cave (Corporate Finance)
Adam Pollock/ Jasper Berry (Corporate
Broking)
Camarco (Financial PR) Tel: +44 20 3757 4980
Nick Hennis / Gordon Poole
About Savannah
Savannah is a diversified resources group (AIM: SAV) with two
development stage projects, a hardrock lithium project in Portugal
which has the largest spodumene lithium resource in Europe, and the
world-class Mutamba Heavy Mineral Sands Project in Mozambique,
which is being developed in a consortium with the global major, Rio
Tinto. The Board is committed to serving the interests of its
shareholders and to delivering outcomes that will improve the lives
of the communities we work with and our staff.
The Company is listed and regulated on AIM and the Company's
ordinary shares are also available on the Quotation Board of the
Frankfurt Stock Exchange (FWB) under the symbol FWB: SAV, and the
Börse Stuttgart (SWB) under the ticker "SAV".
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