Admission To Trading & First Day of Dealings
Carl Esprey, Executive Director of Contango Holdings, said: “I am delighted to have successfully brought this asset to market and I am confident that the work conducted on Lubu in recent years will translate to material value for shareholders in the near future.
“The remaining months of 2020 are set to be punctuated with high impact news flow as we look to deliver first production and revenues from Lubu by the end of Q4. Our strategy is centred on providing early cashflows from this, our first asset, and then expanding our production schedules to realise the full value of this +1 billion tonne coal project. I believe this is a message which will resonate with investors as we look to underpin the Company’s financial performance with the objective of supporting a dividend policy.
“I look forward to providing further updates in the coming weeks and months as we begin our initial activities readying the site for production, specifically the refurbishment and development of supporting facilities, ground clearance and removal of overburden of the 20-acre area that comprises the initial mining zone within Block B2 of Lubu.”
Oliver Stansfield, Non-Executive Director of Contango Holdings, said: “On behalf of the shareholders of Contango I am delighted to welcome Carl and Roy to the Board. The acquisition of Lubu has taken longer than expected but I am confident that this transaction and our entry into Zimbabwe will prove worth the wait. Accessing an asset of this size, quality and stage of development is highly advantageous and Lubu certainly meets all of the investment criteria that we set out with when originally identifying suitable targets. It is with considerable optimism that I look forward to the rest of 2020 and beyond.
“I would also like to thank Brian and Neal for their service to Contango during their tenure on the board and for helping to deliver this milestone transaction.”
Further to the announcement of 17 June 2020, the board of Contango Holdings Plc (‘Contango’ or the ‘Company’) is pleased to announce the admission of its entire share capital, being 203,133,278 ordinary shares of £0.01 each (“Ordinary Shares”) to the Official List (by way of a Standard Listing under Chapter 14 of the Listing Rules) and to trading on the London Stock Exchange’s Main Market for listed securities (the “Admission”). The Company’s Admission follows the completion of the acquisition by way of a reverse takeover of Consolidated Growth Holdings’ interest in the Lubu Coalfield Project in Zimbabwe.
Dealings will commence at 8.00 a.m. today under the TIDM “CGO” with ISIN number GB00BF0F5X78.
· Admission to the Official List following the acquisition, by way of a reverse takeover, of a 70% interest in the Lubu Coalfield Project (“Lubu” or the “Project”):
o Lubu is a derisked development with total historical spend in excess $20 million and over 100 holes and 12,000m of drilling completed and Total resource in excess of 1 billion tonnes of coal
o Contango has acquired the asset for an implied value of £6.4M
o In June 2019, Contango begun advancing funds to commence a new work programme including a 9 hole drill campaign designed to enable full washability test work, detmination of product range, SG and grade to determine product types for the purposes of offtake discussions. In total, over $750,000 spent on the project in the recent 12 months
o Focus initially on small area of B2 Block in Lubu with deposit starting at surface down to a maximum depth of 47m
o Targeting production and sale of semi-soft coking coal for export to Southern African countries and additional potential for sales of thermal coal to domestic power companies
o Targeting an initial 1Mtpa of coal product sales – in discussions with a number of offtake groups
o Site preparation and box cut for mining to commence immediately and first production and sales anticipated before end of 2020
· Raised £1.4m with new and existing investors and now fully funded to first cash flow
· Appointment of Carl Esprey (Executive Director) and Roy Pitchford (Non-Executive Chairman) to the Board providing proven natural resources operational expertise and specialist natural resources financing experience
· Board fully aligned with shareholders given its material equity holding and remuneration of less than £96,000 per annum for the entire board combined
· Immediate focus on early cashflows from Lubu to underpin the Company’s financial position and support a dividend policy
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