TIDMMKA
RNS Number : 1158I
Mkango Resources Limited
31 March 2020
MKANGO RESOURCES LTD.
550 Burrard Street
Suite 2900
Vancouver
BC V6C 0A3
Canada
MKANGO PROVIDES CORPORATE UPDATE
London / Vancouver: March 31, 2020 - Mkango Resources Limited
(AIM/TSX-V: MKA) ("Mkango" or the "Company") would like to provide
the following corporate update in response to the COVID-19 pandemic
and on timing for completion of the on-going Feasibility Study for
its 51% owned Songwe Hill rare earths project in Malawi ("Songwe")
.
In these difficult times, Mkango is working proactively to
protect our staff and our business. The Company remains focused on
completion of the Feasibility Study for Songwe and development of
downstream opportunities through Maginito Limited ("Maginito"),
which includes Maginito's 25% interest in Hypromag Limited
("Hypromag"), a UK based company focused on rare earth magnet
recycling.
The Company is taking the necessary pre-emptive precautions in
response to COVID-19 and providing ongoing advice to its staff in
the country. In this rapidly evolving environment, we are
prioritising the safety of our employees. With the drill programme
for Songwe completed in 2018, most of our in-country operations can
be completed offsite, and all of our employees are now working from
home when possible. All travel has been curtailed.
William Dawes, Chief Executive of Mkango stated: "The welfare of
the Company's staff remains the main priority for Mkango. Whilst
the current market environment is very challenging, Mkango's strong
financial position means the Company is well positioned to weather
ongoing market uncertainty for the foreseeable future. The impact
of COVID-19 has focused attention on the vulnerability of supply
chains globally, already a major concern in the rare earths sector
prior to the pandemic, and Mkango looks forward to further
engagement with Government and market participants to play a major
role in future development of a robust and sustainable rare earth
supply chain for global markets."
Mkango continues to be in a strong financial position with a
current unaudited consolidated cash position totaling approximately
US$7.4 million.
In November 2017, Mkango entered into an agreement with Talaxis
Limited ("Talaxis") to fund the feasibility study for Songwe.
Talaxis has invested GBP12 million in Lancaster Exploration
Limited, ("Lancaster"), Mkango's subsidiary which owns the Songwe
project, for 49% of Lancaster. Talaxis also has an option to
acquire a further 26% of Lancaster by arranging financing for
project development including funding the equity component thereof.
Talaxis also holds a 24.5% interest in Maginito.
Whilst the Feasibility Study is continuing with work underway in
Australia, South Africa and the UK, the Company believes it is
inevitable that some workstreams will be impacted, however the
degree of impact is currently uncertain. Following a review of the
various ongoing workstreams, the Company is now targeting
completion of the Feasibility Study in the second half of 2021, in
line with an anticipated more stable market environment and
favourable backdrop to advance project development. We note,
however, that extended periods of COVID-19 disruption may further
impact this timing.
Operations at HyProMag are continuing where possible, in line
with current UK government guidelines.
About Mkango Resources Limited
M kang o 's pri mary busin e ss is explorat i on for rare earth
ele me n ts and associat ed min erals in the Re public of Malawi, a
country whose hospitable people have earned it a reputation as "the
warm heart of Africa". The Company holds interests in four e
xclusive prosp ecting lice n s es in Malawi: the Phalombe licence,
the Thambani licence, the Chimimbe Hill licence and the Mchinji
licence.
The main exploration target in the 51% held Phalombe licence is
the Songwe Hill rare earths deposit. This features
carbonatite-hosted rare earth mineralisation and was subject to
previous exploration in the late 1980s. Mkango completed an updated
Pre-Feasibility Study for the project in November 2015 and a
Feasibility Study is currently underway, the initial phases of
which included a 10,900 metre drilling programme and an updated
mineral resource estimate, announced in February 2019. In March
2019, the Company announced receipt of a GBP7 million (C$12.3
million) investment from Talaxis to fund completion of the
Feasibility Study. Following completion of the Feasibility Study,
Talaxis has an option to acquire a further 26% interest in Songwe
by arranging financing for project development including funding
the equity component thereof.
The main exploration targets in Mkango's remaining three 100%
held licences are, in the Thambani licence, uranium, niobium,
tantalum and zircon, in the Chimimbe Hill licence, nickel and
cobalt, and in the Mchinji licence, rutile, nickel, cobalt, base
metals and graphite.
Mkango also holds a 75.5% interest in Maginito with the balance
owned by Talaxis. Maginito is focused on downstream opportunities
relating to the rare earths supply chain, in particular, recycling
and other innovative technologies for the production of neodymium
alloy powders and magnets used in electric vehicles, wind power and
other industries geared to decarbonisation of the economy.
For more information, please visit www.mkango.ca .
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement may have been
deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
Cautionary Note Regarding Forward-Looking Statements
This news release contains forward-looking statements (within
the meaning of that term under applicable securities laws) with
respect to Mkango, its business and the Project. Generally, forward
looking statements can be identified by the use of words such as
"plans", "expects" or "is expected", "scheduled", "estimates"
"intends", "anticipates", "believes", or variations of such words
and phrases, or statements that certain actions, events or results
"can", "may", "could", "would", "should", "might" or "will", occur
or be achieved, or the negative connotations thereof. Forward
looking statements in this news release include statements with
respect to the effects of COVID-19 on Mkango's business, global
market for rare earth metals the Company is exploring for,
completion of the feasibility study for Songwe. Readers are
cautioned not to place undue reliance on forward-looking
statements, as there can be no assurance that the plans, intentions
or expectations upon which they are based will occur. By their
nature, forward-looking statements involve numerous assumptions,
known and unknown risks and uncertainties, both general and
specific, that contribute to the possibility that the predictions,
forecasts, projections and other forward-looking statements will
not occur, which may cause actual performance and results in future
periods to differ materially from any estimates or projections of
future performance or results expressed or implied by such
forward-looking statements. Such factors and risks include, without
limiting the foregoing, governmental action relating to COVID-19,
COVID-19 and other market effects on global demand for the metals
and associated downstream products for which Mkango is exploring,
researching and developing, the positive results of a feasibility
study on the Project and delays in obtaining financing or
governmental or stock exchange approvals. The forward-looking
statements contained in this news release are made as of the date
of this news release. Except as required by law, the Company
disclaims any intention and assumes no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
applicable law. Additionally, the Company undertakes no obligation
to comment on the expectations of, or statements made by, third
parties in respect of the matters discussed above.
For further information on Mkango, please contact:
Mkango Resources Limited
William Dawes Alexander Lemon
Chief Executive Officer President
will@mkango.ca alex@mkango.ca
Canada: +1 403 444 5979
www.mkango.ca
@MkangoResources
Blytheweigh
Financial Public Relations
Tim Blythe, Camilla Horsfall
UK: +44 207 138 3204
SP Angel Corporate Finance LLP
Nominated Adviser and Joint Broker
Jeff Keating, Caroline Rowe
UK: +44 20 3470 0470
Alternative Resource Capital
Joint Broker
Alex Wood, Rob Collins
UK: +44 20 7186 9004; +44 20 7186 9001
The TSX Venture Exchange has neither approved nor disapproved
the contents of this press release. Neither the TSX Venture
Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy any equity or other securities of
the Company in the United States. The securities of the Company
will not be registered under the United States Securities Act of
1933, as amended (the "U.S. Securities Act") and may not be offered
or sold within the United States to, or for the account or benefit
of, U.S. persons except in certain transactions exempt from the
registration requirements of the U.S. Securities Act.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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