TIDMBNR
RNS Number : 9183X
Blenheim Natural Resources PLC
30 November 2017
30 November 2017
Blenheim Natural Resources Plc
("Blenheim" or "the Company")
Acquisition of Interest in Large Scale Cobalt Opportunity
Blenheim is pleased to announce that it has conditionally
acquired a 25% stake in Cobalt Blue Holdings Inc ("CBH"), a company
incorporated in BVI, with interests in Cobalt exploration in
Cameroon for a consideration of up to 550,000,000 Warrants
("Consideration Warrants") over ordinary shares of 0.1 pence each
in the capital of the Company ("Ordinary Shares") subject to the
granting of 6 exploration licences in Cameroon. The Acquisition is
part of the Company's strategy to make investments in technology
metal related opportunities and is complementary to the recent
investment in several highly prospective lithium licences in
Mali.
Blenheim has also entered into a conditional Call Option valid
for 6 months which would allow it to increase its stake in CBH to
49% for cash of GBP800,000 ("Cash Consideration"). If the Call
Option is exercised by the Company, the entire Cash Consideration
of GBP800,000 will be utilised to fund the prospecting and
exploration costs of CBH with no dilution to Blenheim's 49%
interest.
The issue of the Consideration Warrants and the Call Option are
conditional upon the approval of the Company's shareholders of the
Company in general meeting of the share capital authorities
required to allow the exercise of the Warrants. The Company has
undertaken to send out a Notice convening a general meeting of
shareholders to seek these authorities within 10 business days.
Highlights:
-- CBH has applications for 6 exploration licences totalling 2,837 km(2) in Cameroon
-- 5 of these licences are for territories neighbouring the
Nkamouna and Mada Cobalt-Nickel Project which has significant
Cobalt reserves; the 6(th) is in the Mvina division in the North of
Cameroon
-- Initial 25% of CBH acquired and an option for 6 months to
acquire a further 24% for GBP800,000
-- The Cash Consideration would fund a staged exploration
programme across the licence areas and the potential acquisition of
other cobalt assets and exploration licences
-- Acquisition in line with the Board's defined strategy of
making investments in the natural resource sector and in particular
technology metal opportunities with a focus on lithium and
cobalt
-- Strong market dynamics for cobalt
o Cobalt price up 120% to $62,499 per metric tonne over last 12
months
o Increasing demand for uses in Electric Vehicle ('EV') and
limited new supply coming on-stream outside the DRC, which
currently produces 53% of global supply
Blenheim Chairman Chris Ells commented, "This is our first
investment into cobalt exploration and provides the Company with a
highly prospective opportunity in close proximity to one of the
world's significant cobalt deposits. Cobalt, alongside lithium and
nickel, is a major commodity which will be greatly in demand from
the growing lithium Ion battery/EV market. Securing this interest
provides Blenheim with exposure to this valuable metal and is
complementary to our Malian lithium investments, which we believe
are in the right geographical location and sector. We are a growing
company with a defined strategy and structure which we believe will
capitalise on our network and build a company which can deliver a
portfolio benefitting from the changing global EV dynamic and
upsurge in demand for technology metals."
CBH Exploration Licences
CBH is a Cobalt exploration group which is developing a
portfolio of Cobalt assets across Africa. CBH has two 100% owned
subsidiaries both incorporated in Cameroon, LC Exploration Limited
and LC Minerals Limited. These subsidiaries have applied for 6
exploration licences at Ngoila Nord, Ngoila Est, Ekok, N'Tam Est
,N'Dja and Ngaoundéré. The application submissions for the licences
were completed on 17 November 2017. Such applications for an
exploration licence are processed within forty-five (45) days from
the date of receipt of the applications. If an application is not
processed within the 45 day period, the licence shall be deemed to
be granted, unless the Mining Administration has notified the
applicant in writing with regards to an extension of the processing
time which shall not exceed the initial period.
These exclusive exploration licences, once granted, will be
issued for an initial period of three years and may be renewed up
to three times, for a maximum period of two years each.
Ngoila Nord, Ekok, Ngoila Est, Ntam Est and Dja are in the
Haut-Nyong, Haut-Nyong & Boumba-et-Ngoko, Haut-Nyong,
Boumba-et-Ngoko and Haut Nyong & Dja-et-Lombo divisions
respectively. The area is highly prospective for Cobalt and
associated minerals and are situated in close proximity to the
Nkamouna and Mada deposits in the Haut-Nyong division.
The neighbouring Nkamouna and Mada cobalt-nickel deposits were
audited by SRK in June 2011 (for Geovic Mining Corporation) in
accordance with CSA NI 43-101 standards and in conformity with
generally accepted CIM 'Estimation of Mineral Resources and Mineral
Reserves Best Practices' guidelines.
(Source
:www.sec.gov/Archives/edgar/data/1398005/000119312511161283/dex991.htm
#18-56)
A staged exploration programme is being developed to identify
targets across the licence areas. Stage 1 will comprise a desktop
targeting study of available regional geophysical, and GIS data -
Airborne Magnetic, Radiometric and DEM Processing, ASTER data
review, Landsat 9 Data Review, high-resolution aerial imagery,
consequent interpretation and targeting.
Stage 2 will follow up on the identified targets with ground
verification, mapping and sampling. Grab samples, trenching and
soil sampling will be cross-referenced with the geophysical targets
and used to structure Stage 3 - a shallow auger drilling
campaign.
CBH Financials
Cobalt Blue Holdings Inc ("CBH") was incorporated on 16 October
2017 as a BVI Business Company with Company Number 1957972. CBH has
share capital of US$2,000 representing net assets of US$2,000 and
has not traded in the period.
Transaction Structure
Blenheim has entered into a Share Purchase Agreement ("SPA")
with Cobalt Blue Associates Inc ("CBA") to conditionally acquire a
25% interest in Cobalt Blue Holdings Inc ("CBH"), a company
incorporated in BVI, for a consideration comprising the issue of
550,000,000 Warrants ("Consideration Warrants") over Ordinary
Shares subject to the granting on 5 licences in Cameroon.
The First Warrant is over 300,000,000 Ordinary Shares and is
exercisable at a price of 0.1p per share (being the nominal value
of the Ordinary Shares) in the event that 3 out of the 5
exploration licences adjacent to the Nkamouna and Mada
Cobalt-Nickel Project have been granted. The First Warrants may be
exercised at any time until the third anniversary of the date on
which the 5th Cameroon Licence has been granted. At the closing
mid-market price of the Company's shares on 29 November 2017 (of
0.59p) the Warrants have an "in the money" value of GBP1.47
million.
The Second Warrant is over a further 250,000,000 shares and is
exercisable at a price of 0.65p per share in the event that all 5
exploration licences adjacent to the Nkamouna and Mada
Cobalt-Nickel Project have been granted. These Warrants may be
exercised at any time once all 5 of the Cameroon Licences have been
granted until the third anniversary of the date on which the 5th
Cameroon Licence has been granted.
Together the First Warrants and Second Warrants, if exercised,
will represent 34.35% of the issued share capital (as enlarged by
their exercise and on the assumption that no other existing options
and warrants are exercised.)
Any shares issued as a result of the exercise of the
Consideration Warrants will be subject to an agreement whereby, for
a period of 12 months following the allotment of shares thereunder,
the sale of shares must be conducted through the Company's brokers
on an orderly market basis.
Shareholders' Approval of share capital authorities and General
Meeting
The issue of the Consideration Warrants to acquire the initial
25% interest in CBH is conditional upon the approval of
shareholders of the Company in general meeting of the share capital
authorities required to allow the exercise of the Warrants.
The Company has undertaken to send out a Notice convening a
general meeting of shareholders to seek these authorities within 10
business days.
Call Option
Blenheim has also entered into a call option ("Call Option")
with a 6 month maturity to increase its stake in CBH to 49% for
cash consideration of GBP800,000. If the Call Option is exercised
by the Company, the entire cash consideration of GBP800,000 will be
utilised to fund the prospecting and exploration costs of CBH with
no dilution to Blenheim's 49% interest.
The Company will be entitled to appoint one director to the
board of CBH.
Ends
For further information please contact:
Chris Ells Blenheim Natural Resources Plc +44 (0)1622 844601
Spark Advisory Partners Limited
Neil Baldwin/Mark Brady (Nominated Adviser) +44(0)203 368 3554
Nick Emerson SI Capital Ltd (Broker) +44 (0)1483 413500
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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