Acquisition of Controlling Interest in Australia’s Largest Undeveloped Palladium Deposit
Empire Metals Limited, the AIM-quoted resource exploration and development company, announces that it has entered into a Binding Heads of Agreement (the ‘Agreement’) with ASX listed Artemis Resources Limited (‘Artemis’) to acquire a 41% interest in the Munni Munni Palladium Project in the West Pilbara, Western Australia (‘Munni Munni’ or the ‘Project’) and has first right of refusal on a further 29% interest in the project.
To view the announcement with illustrative maps and diagrams please use the following link: http://www.rns-pdf.londonstockexchange.com/rns/8834K_1-2020-4-26.pdf
· Munni Munni hosts the largest intrusion in the globally recognised resource destination of West Pilbara and is the largest undeveloped primary Platinum Group Elements Resource in Australia:
· JORC 2004 Resource of 24Mt @ 2.9 g/t Platinum Group Element (PGE) and gold (12.4Mt Measured, 9.8Mt Indicated, and 1.4Mt Inferred), containing 1.14Moz palladium, 0.83Moz platinum, 152Koz gold and 76Koz rhodium)
· Four granted mining leases covering a total of 64km2
· Layered mafic/ultramafic intrusion with mineralisation hosted in the Ferguson Reef with all likely extensions contained within Munni Munni exploration tenements
· PGEs are a group of six precious metals clustered together on the periodic table: platinum (Pt), palladium (Pd), iridium (Ir), osmium (Os), rhodium (Rh) and ruthenium (Ru).
· Palladium is extremely rare and is now one of the most valuable precious metals, with a supply shortage driving current prices to circa US$2,000/oz; Rhodium prices are currently circa US$7,500/oz
· Agreement advances Empire’s strategy to diversify project portfolio and expand geographic focus:
· The Pilbara in Western Australia is one of the most highly mineralised regions globally and hosts numerous world class mines within a stable mining jurisdiction
· Munni Munni represents a low-cost entry point to an attractive and mature investment environment with significant upside potential
· Total cost of acquisition of £975,000, to be settled via the issue of 95 million new ordinary shares at a price of 1 pence per share and a cash option payment of £25,000
· Completion subject to satisfaction of certain conditions including transfer of licences and regulatory approvals
· Initial work programme to consist of reinterpretation of existing data with a view to undertaking an initial drill programme in the second half of the year.
Mike Struthers, CEO, said: “This acquisition represents the start of a new chapter for Empire. Over the past 18 months the Company has been actively reviewing a number of exciting opportunities to fulfil the objective of de-risking our growth strategy by diversifying away from a single jurisdiction investment. We believe the opportunity presented with the Munni Munni Project in Australia satisfies this goal by combining an exceptional project with an attractive and mature investment environment.
“Having recently received confirmation on the tenure of two of our primary projects in Georgia and with an appeal process commenced on a third key asset, the Company has achieved some major steps towards the recommencement of fieldwork at Kvemo Bolnisi and other key assets. But as is the case with most countries, government agencies in Georgia are focussed on those activities considered a priority for dealing with the COVID-19 pandemic and a result, we are waiting for clarity on how our development schedule will advance.
“We are very excited about this new opportunity and look forward to updating shareholders on completion and our plans for Munni Munni in due course.”
Empire Metals has entered into a Binding Term Sheet with Artemis Resources Limited and Almeera Ventures Limited (“Almeera”) (the “Agreement”) to acquire an effective 41% interest in four mining licences and an exploration licence, covering a 64km2 tenement area, located in the in the West Pilbara, Western Australia, known as Munni Munni.
Artemis currently hold a 70% interest in Munni Munni and the remaining 30% is held by ASX listed Platina Resources Limited. Almeera has claim to an option over Artemis’s holding in Munni Munni. Almeera has agreed to withdraw its claim to allow Empire to enter into the Agreement. In consideration for the withdrawal of this claim, Empire will make a loan to Almeera of £100,000 (which will be made in the form of an issue to Artemis of 10,000,000 new ordinary shares of Empire) to satisfy the consideration due to Artemis for the acquisition of a 10% stake in the Munni Munni licence (the “Almeera Shares”) by Almeera. The loan is repayable by Almeera three years from the date of Completion and will attract an interest rate of 2% per annum. The total consideration payable to Artemis of £600,000 is to be satisfied via the issue of 60,000,000 new ordinary shares (including the Almeera Shares) at a price of 1 pence per share. An introduction and advisory fee of £350,000 will also be paid to a third party on Completion and will be satisfied by the issue of 35,000,000 new ordinary shares at a price of 1 pence per share. The total new ordinary shares expected to be issued pursuant to the Agreement is 95,000,000, which will represent 32.9% of the enlarged share capital of the Company.
On Completion, Empire will hold an effective interest of 41% in the Munni Munni Project, Platina Resources Limited will hold 30%, Artemis will hold 19% and Almeera will hold 10% (together the “Parties”). Empire will be the operator of the Project and will have also a right of first refusal for the acquisition of the remaining interest held by Artemis and Almeera in the Munni Munni Project, allowing Empire to move to 70%.
Completion is subject to a number of conditions precedent including completion of due diligence, execution of a formal joint venture agreement between the Parties, obtaining necessary regulatory approvals and obtaining all necessary third-party consents and approvals to give effect to the proposed acquisition. A significant amount of work has already taken place between the Parties and it is expected that the Conditions Precedent will be completed in a timely manner.
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