TIDMSML
RNS Number : 6261L
Strategic Minerals PLC
14 January 2021
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
14 January 2021
Strategic Minerals plc
("Strategic Minerals" or the "Company")
December Quarter 2020 Magnetite Sales and Cash Balances
Strong Cobre Sales Continue
Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a profitable
producing mineral company , is pleased to provide the following
update on the Company's cash position and ore sales at the Cobre
magnetite operation in New Mexico, USA ("Cobre") for the quarter
ended 31 December 2020.
Highlights
-- Cobre annual sales exceed US$3m
-- Revenue growth of over 20% year on year at Cobre
-- The Leigh Creek Copper Mine ("LCCM") approval process for
mining the Paltridge North deposit continues, indicating the
potential to recommence operations in 2021, subject to finance
-- Cornwall Resources team continues working with NRG Capital on progressing the Redmoor Project
-- Appointment of Karen Williams as Chief Financial Officer (Non-board position)
-- Group cash balance of US$0.833m as at 31 December 2020
Sales update: Cobre magnetite tailings operations
The December quarter 2020 saw sales at Cobre continue to grow,
up by over 20% year on year. Sales remained robust and the positive
annual growth highlights the strength of demand being maintained
despite the Covid-19 pandemic.
Sales comparisons on quarterly and annual periods to 31 December
2020, along with associated volume details, are shown in the table
below:
Tonnage Sales (US$'000)
--------------------------- ---------------- -------------
Year 3 months to 12 months to 3 months to 12 months to
Dec Dec Dec Dec
2020 12,845 51,518 747 3,025
2019 12,202 42,517* 713 2,488*
2018 10,931 48,220* 633 2,842*
* For comparison purposes, all sales in these periods to CV
Investments LLC ("CV") have been excluded including the US$0.75m
forfeited by CV.
Despite the continued suspension of mining activities at the
adjacent copper mine due to the Covid-19 pandemic, activities at
Cobre continue to operate under protocols established to ensure
contactless sales and have been successful, safeguarding both
Company employees and clients.
The Company's wholly owned subsidiary, Southern Minerals Group
("SMG"), continues to remain in contact with the receiver appointed
by the US Securities Exchange Commission in relation to the
previously notified US$21.9m arbitration claim against CV
Investments LLC and the Company will update the market with details
as and when they are provided by the Receiver.
Financials and Operations
At 31 December 2020, the Group's non-restricted cash balance was
US$0.833m (30 September 2020: US$0.264m). The increase in the cash
balance reflected the net proceeds raised in the Company's December
capital raise and continued profitable trading at Cobre.
During the quarter, the Company continued, in conjunction with
NRG Capital, to promote the Redmoor tungsten and tin project
("Redmoor" or the "Redmoor Project") to a number of entities with a
view to progressing Redmoor. This process remains ongoing with the
Cornwall Resources team still engaging with counterparties.
The process for the Leigh Creek Copper Mine ("LCCM") Program for
Environmental Protection and Rehabilitation ("PEPR"), for planned
copper mining at the Paltridge North deposit, continues to progress
as expected. In late December 2020, the Company received official
feedback from the South Australian government in relation to the
PEPR application for the deposit and the Company is currently
preparing a response, and expects to submit this to the South
Australian government during the quarter ended 31 March. At
present, and subject to the receipt of funding, the Company does
not believe that any issues identified will prevent planned mining
and processing occurring at Leigh Creek in 2021.
Following the announcement of the improved LCCM project
economics on 9 November 2020, the Company continues discussions
with a number of parties that have expressed an interest in
investing in the Leigh Creek project and expects to be able to
ultimately conclude an agreement once the PEPR for the Paltridge
North deposit has been issued. The strong copper price, together
with the potential upside associated with producing copper sulphate
at Lynda/Lorna Doone, continue to enhance the appeal of LCCM to
potential investors.
Ms Karen Williams has assumed the non-board position of Chief
Financial Officer for the Company, replacing Mr Julien McInally. Ms
Williams has been heavily involved with the Company's financial
control for several years and understudied Mr McInally for much of
this time. Mr McInally's departure reflects his desire to follow
alternative employment opportunities and during his time at the
Company he has made a significant contribution to its
turnaround/performance from mid-2014.
Commenting, John Peters, Managing Director of Strategic
Minerals, said:
"Continued strong sales at Cobre, combined with the December
capital raise, have placed the Company in a solid position to move
forward in 2021 with a goal of commencing a second income stream
from copper production at Leigh Creek, subject to finance.
Concurrently, we continue our endeavours to progress the Redmoor
Project.
"On behalf of the Board, I would like to thank our outgoing
Chief Financial Officer, Julien McInally, for his numerous
contributions to the Company's operations and wish him well in his
future employ. At the same time, I would like to welcome the
Company's new Chief Financial Officer Karen Williams, who has
already demonstrated her capacity to be a key member of the
management team and provide strategic support to the Board. "
For further information, please contact:
+61 (0) 414 727
Strategic Minerals plc 965
John Peters
Managing Director
Website: www.strategicminerals.net
Email: info@strategicminerals.net
Follow Strategic Minerals on:
Vox Markets: https://www.voxmarkets.co.uk/company/SML/
Twitter: @SML_Minerals
LinkedIn: https://www.linkedin.com/company/strategic-minerals-plc
+44 (0) 20 3470
SP Angel Corporate Finance LLP 0470
Nominated Adviser and Broker
Matthew Johnson
Ewan Leggat
Charlie Bouverat
Notes to Editors
Strategic Minerals plc is an AIM-quoted, profitable operating
minerals company actively developing projects tailored to materials
expected to benefit from strong demand in the future. It has an
operation in the United States of America along with development
projects in the UK and Australia. The Company is focused on
utilising its operating cash flows, along with capital raisings, to
develop high quality projects aimed at supplying the metals and
minerals likely to be highly demanded in the future.
In September 2011, Strategic Minerals acquired the distribution
rights to the Cobre magnetite tailings dam project in New Mexico,
USA, a cash-generating asset, which it brought into production in
2012 and which continues to provide a revenue stream for the
Company. This operating revenue stream is utilised to cover company
overheads and invest in development projects orientated to
supplying the burgeoning electric vehicle/battery market.
In May 2016, the Company entered into an agreement with New Age
Exploration Limited and, in February 2017, acquired 50% of the
Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds
from the Company's investment were utilised to complete a drilling
programme that year. The drilling programme resulted in a
significant upgrade of the resource. This was followed in 2018 with
a 12-hole 2018 drilling programme has now been completed and the
resource update that resulted was announced in February 2019. In
March 2019, the Company entered into arrangements to acquire the
balance of the Redmoor Tin/Tungsten project which was settled on 24
July 2019 by way of a vendor loan which was fully repaid on 26 June
2020.
In March 2018, the Company completed the acquisition of the
Leigh Creek Copper Mine situated in the copper rich belt of South
Austra lia and brought the project temporarily into production in
April 2019. The project currently awaits clearance from the South
Australian Government of its lodged Program for Environmental
Protection and Rehabilitation (PEPR).
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