Euro Manganese Inc. (TSX-V and ASX: EMN; OTCQX: EUMNF; Frankfurt:
E06) ("
Euro Manganese", the
"
Company" or "
EMN") is pleased to
release highlights of its completed Feasibility Study
("
FS" or "
Study") for the
Company’s flagship Chvaletice Manganese Project
("
CMP" or "
Project") located in
the Czech Republic.
All financial figures are in US dollars unless
otherwise stated.
HIGHLIGHTS
- Robust base case project
economics
- After-tax Net Present Value ("NPV") of US$1.34
billion and pre-tax NPV of US$1.75 billion, using an 8% real
discount rate and risk-adjusted base case price forecast.
- Ungeared after-tax Internal Rate of Return
("IRR") of 21.9% with a 4.1-year payback period;
and pre-tax IRR of 24.9% with a 3.6-year payback period.
- Initial capital ("Capex") of US$757.3 million,
including contingencies of US$103.2 million (US$78.4 million on
direct costs and US$24.8 million of growth capital).
- Sustaining capital ("Sustaining Capex") of
US$117.0 million over the 25-year life of project
("LOP").
- LOP revenues of US$13.9 billion with gross revenues expected to
average US$554 million per year over the 25-year project life.
- Project earnings before interest, taxes, depreciation and
amortization ("EBITDA") and annual average EBITDA
forecasted to be US$8.1 billion and US$326 million respectively,
averaging 58.8% EBITDA over the LOP.
- Project of strategic importance to Europe with
exceptional environmental and social benefits and production of
in-demand products
- Uniquely positioned to provide a secure, traceable, and
responsibly produced supply of high-purity manganese products to
the European electric vehicle ("EV") market.
- CMP is the only sizable, Proven and Probable Reserve of
manganese in the European Union.
- Located in the Czech Republic, a sophisticated, stable, and
business-friendly jurisdiction that is highly supportive of new,
green investments.
- Excellent transportation, energy and community infrastructure,
and land for the processing plant and related infrastructure.
- Unique green project credentials with a low carbon footprint
and net positive environmental benefits resulting from recycling
and remediation of the Chvaletice historic tailings.
- Significant support from local communities, municipalities, the
Czech government, and the European Union.
- Wide-ranging benefits for local communities and the Czech
Republic in the form of jobs and revenues:
- The Project expects to employ ~400 people during
operation.
- An estimated US$1.5 billion in payments are expected to be made
to the Czech Republic from corporate taxes and royalties.
- High Purity Manganese market forecasted to increase
significantly over the life of Project
- According to CPM Group LLC ("CPM Group"), a
leading, independent commodities market research firm with
expertise in high-purity manganese, the market for high-purity
manganese sulphate monohydrate ("HPMSM") and
high-purity electrolytic manganese metal ("HPEMM")
is forecast to be radically transformed as a result of the
‘electric vehicle revolution’. Most lithium-ion batteries that
power electric vehicles are expected to use manganese
("Mn") in their cathodes and these
manganese-containing battery chemistries are expected to dominate
the battery market for the next two decades.
- As a result, CPM Group expects the demand for high purity
manganese to increase 13 times between 2021 and 2031 (from 90 kt to
1.1 million tonnes ("t") of Mn contained) and 50
times between 2021 and 2050 (to 4.5 million tonnes of Mn
contained).
- The total Mn market in 2022 is approximately 22 million tonnes,
with Mn use currently dominated by the steel industry, however,
high purity manganese suitable for the battery market makes up less
than 0.5% of the global manganese market.
- The bottleneck in supply of HPMSM and HPEMM is the lack of
high-purity refining capacity. Known expansions and new projects
are unable to satisfy this demand. CPM Group forecast’s the 2031
deficit to be 475kt Mn equivalent and if battery demand continues
to grow as expected and no additional new projects come to the
market, the deficit would increase to 1 million tonnes by
2037.
- European HPMSM and HPEMM base case pricing with further
potential upside outlined in sensitivity analysis
- Base case project economics are based on Tetra Tech Canada
Inc.’s ("Tetra Tech") adoption of a risk-adjusted
short-term price forecast that follows CPM Group’s forecast for
HPMSM and HPEMM to 2031 and then holds prices flat over the
remaining LOP, resulting in average prices of $4,019 per tonne of
HPMSM containing 32.34% Mn and $10,545/t of HPEMM containing 99.9%
Mn.
- CPM Group’s unaltered price forecast was used as the upside
case in the sensitivity analysis with average LOP prices of
$4,509/t for HPMSM and $12,075/t for HPEMM.
- Attractive proposition for potential financial
partners
- Euro Manganese recently appointed Stifel Nicolaus Europe
Limited, a wholly owned subsidiary of Stifel Financial Corp.
(NYSE:SF) ("Stifel"), as financial adviser to
assist with the structuring and securing of financing for the
Project.
- The Company believes the FS confirms that the Project is an
attractive proposition for potential financial partners due to its
robust project economics, in-demand products, unique environmental
credentials, excellent jurisdiction located in the heart of
European EV market, and strong support from leading financial
European institutions.
- Conversion rate of ~99% Resources to Reserves supports
a 25-year project life
- Tetra Tech used appropriate
modifying factors to convert the Mineral Resource to a 27 million
tonne Proven and Probable Reserve (98.3% Proven) with a grade
averaging 7.41% Mn.
- Study is based on the reprocessing
of historic tailings without the requirement of any hard rock
mining, crushing or milling.
- FS outlines a 25-year project life
producing 1.19 million tonnes of HPEMM, approximately two-thirds of
which is expected to be converted into HPMSM on-site.
- Saleable product includes 2.5
million tonnes of HPMSM (32.34% Mn) and 372,300 tonnes of HPEMM
(99.9% Mn) over the LOP, averaging 98,600 tonnes of HPMSM and
14,890 tonnes of HPEMM annually, focused principally on Europe's
rapidly growing EV battery industry.
- Flexibility to supply either HPMSM
or HPEMM, to suit customer preference.
Dr. Matthew James, Euro
Manganese’s President and CEO, commented:
“I am extremely pleased with the results of the
Feasibility Study, which further validate the financial credibility
of the Chvaletice Manganese Project, even in the current
inflationary environment and using conservative risk-adjusted
pricing for HPMSM and HPEMM. The strength of the Project economics,
its green credentials and the forecast demand from the EV industry
for our highly specialized products support a wide range of
financing alternatives.
Several factors uniquely position Euro Manganese
to transform into a leading supplier to the European EV market. The
supply security, traceability, sustainable production, and low
impurity, high quality nature of Chvaletice’s battery grade
manganese products, make our HPEMM and HPMSM increasingly desirable
to customers.
I am proud of the team’s accomplishments in
delivering this very positive Feasibility Study and confirming the
viability of the Project. We remain focused on progressing our key
milestones towards making a final investment decision, including
securing our financing package for the Project, and have already
commenced work alongside our recently appointed project finance
adviser, Stifel Nicolaus Europe Limited.”
Mr. John Webster, Chair of the
Board of Euro Manganese, commented:
“The global automobile industry has been
transformed in recent years with manufacturers focused on the
transition to electric vehicles. This focus has not only resulted
in an increased demand for battery raw materials, but specifically
for those sourced from a sustainable and responsible supply chain.
At the same time, manganese has emerged as a key component in the
dominant formulations of lithium-ion batteries. This has created an
unprecedented opportunity for us.
The Chvaletice Project is a key pillar in
ensuring the security of supply for Europe’s EV industry. Our
strategic location in the Czech Republic, central to an emerging
cluster of electric vehicle plants and a related ecosystem of
chemical, cell and battery producers, our 25-year operating life,
and our commitment to the responsible production of high-purity
manganese products, has attracted the attention of lithium-ion
battery, battery precursor and cathode makers from around the
world.
The completion of our Feasibility Study is a
significant milestone for Euro Manganese and moves us a step closer
to bringing the Chvaletice Manganese Project into production.”
FEASIBILITY STUDY SUMMARY AND PROJECT
ECONOMICS
The following table summarizes the material
assumptions used in and the results of the FS, assuming a targeted
start of production in 2027. Plant commissioning is anticipated to
commence in 2026.
Table 1: Summary of Chvaletice
Feasibility Study (Base Case)
Metrics |
Units |
Results |
Project Summary |
|
|
Type of operation |
|
Tailings reprocessing |
Life of Project (“LOP”) |
Years |
25 |
Price Assumptions - average LOP (2027-2051) |
|
|
High purity manganese sulphate monohydrate (“HPMSM”) |
$/tonne |
4,019 |
High-purity electrolytic manganese metal (“HPEMM”) |
$/tonne |
10,545 |
Production |
|
Average Annual |
LOP |
Total tailings extracted & processed |
Dry Kt |
1,066 |
26,644 |
Total manganese grade |
% |
7.41 |
7.41 |
Contained manganese (Mn) |
Kt |
78.9 |
1,973.5 |
Total HPEMM produced |
Kt |
47.8 |
1,194.5 |
HPEMM further processed into HPMSM |
Kt |
32.9 |
822.3 |
HPEMM sold |
kt |
14.9 |
372.2 |
HPMSM produced / sold |
Kt |
98.6 |
2,465.0 |
Total Mn contained in HPEMM & HPMSM |
Kt |
46.8 |
1,171.9 |
Overall total Mn recovery |
% |
59.4 |
59.4 |
Revenues |
|
Average Annual |
LOP |
Revenue from HPEMM |
$M |
157 |
3,931 |
Revenue from HPMSM |
$M |
397 |
9,931 |
Total revenue |
$M |
554 |
13,862 |
Operating Costs (per tonne of dry plant feed) |
|
|
Tailings extraction |
$/t |
2.44 |
Magnetic separation, HPEMM & HPMSM processing |
$/t |
143.18 |
Tailings stacking/storage, site services, land rentals, and water
treatment |
$/t |
27.11 |
General & Administrative |
$/t |
12.79 |
Contingency |
$/t |
9.28 |
Site operating costs |
$/t |
194.79 |
Freight and insurance, and selling costs |
$/t |
15.22 |
Czech government royalty(1) |
$/t |
4.53 |
Total operating costs |
$/t |
214.54 |
Capital Costs and Working Capital |
|
|
Initial capital |
$M |
757.35 |
Sustaining capital over Life of Project |
$M |
117.0 |
Initial working capital(2) |
$M |
78.7 |
Project Economics |
|
Pre-Tax |
After Tax |
NPV (8% real discount rate) |
$M |
1,750 |
1,342 |
IRR |
% |
24.9 |
21.9 |
Payback period, from start of processing |
Years |
3.6 |
4.1 |
Cumulative cash flow, undiscounted |
$M |
7,309 |
5,912 |
Notes:
- Czech government royalty is 2,308 Czech Koruna (CZK) per tonne
of Mn produced, translated to USD at a projected CZK to USD
exchange rate of 22.43.
- Initial working capital represents the build up of $29.1
million in inventory and $49.6 million in receivables over the
course of the first year.
CASH FLOWS
Table 2: Project Revenue, Costs and Cash
Flows (Base Case)
Projected Cash Flows |
Average Annual($M) |
Life of Project($M) |
HPMSM revenue |
397.2 |
9,931.2 |
HPEMM revenue |
157.2 |
3,930.9 |
Gross revenues |
554.5 |
13,862.1 |
Freight and insurance, and selling costs |
16.2 |
405.6 |
Czech government royalty |
4.8 |
120.6 |
Net revenues |
533.4 |
13,335.9 |
Site operating costs |
207.6 |
5,190.1 |
Capital costs (initial, sustaining and demolition less salvage
value) |
33.5 |
836.4 |
Projected cash flow (pre-tax) |
292.4 |
7,309.4 |
Corporate taxes |
55.9 |
1,397.4 |
Undiscounted cash flows |
236.5 |
5,912.0 |
The Czech corporate income tax rate is 19%. In
addition to the royalty of CZK 2,308 per tonne of unit Mn produced,
the Czech Republic has various payroll and other taxes. The Company
has modeled the economics of the Project conservatively from a tax
perspective, with a full tax burden, based on Czech legislated tax
rates.
For a detailed table of cash flows, please see
Appendix 2.
HPMSM and HPEMM PRICING
HPMSM and HPEMM pricing used in this FS is based
on price projection assumptions developed by CPM Group, a leading,
independent commodities market research firm, with expertise in
high-purity manganese.
CPM Group’s price forecast for HPMSM and HPEMM
was driven by supply and demand dynamics. Factors taken into
consideration of CPM Group’s analysis include:
- A significant increase in
forecasted demand for HPMSM and HPEMM markets, resulting from an
estimated 30-fold increase in the use of manganese in lithium-ion
batteries for electric vehicles between 2021 and 2036;
- A project supply pipeline with six
non-Chinese HPMSM projects potentially coming on stream by 2030,
plus an assumption of supply coming from recycling batteries and an
increase in Chinese supply; and
- A deficit in 2031 of 475kt Mn
equivalent. If battery demand continues to grow as expected and no
additional projects come to the market, the deficit would increase
to 1 million tonnes by 2037.
CPM Group calculated a European HPMSM price
based on the Chinese HPMSM price plus the cost of transportation to
Europe (sea freight and land transport), import duties (currently
suspended), and premiums for purity, traceability and ESG
credentials. CPM Group’s estimate puts these European premiums at
15-25% of the Chinese HPMSM price. It should be noted that
published HPMSM prices cover many different purities of the product
traded, much of which is unable to meet European EV battery
producers’ specifications.
Current HPEMM pricing is based on EMM being
predominantly a metallurgical market metal, however HPEMM is
expected to become predominantly a battery market metal in the near
future as this metal can be converted into HPMSM. CPM Group
estimates that the demand for HPEMM will significantly increase,
leading to competition for supply between the metallurgical
industry and a significantly larger battery industry with a supply
deficit. Therefore, future HPEMM pricing is forecast to be derived
from the HPMSM price as set by the EV battery industry rather than
set by the metallurgical market.
This price differential between battery market
grade HPEMM and HPMSM is estimated to equate to the cost of
conversion of metal into sulphate, plus the profit of the
converter, plus an element of amortization of the converter’s
capital expenditure incurred when building the dissolution plant,
conservatively estimated to be a total of approximately $2,000/mt
of metal. Therefore, this differential is subtracted from the
European price of HPMSM, on a metal basis, to provide a European
price of HPEMM.
Base Case vs Upside Case
Pricing
Tetra Tech adopted a risk-adjusted, short-term
forecast for the base case price used in this FS that follows CPM
Group’s forecast for HPMSM and HPEMM to 2031 and then holds prices
flat over the remaining LOP.
The upside case uses CPM Group’s unaltered
forecast, which increases pricing through to 2035, then holds
prices flat between 2035 and 2040, recognising that a price will be
reached which would stimulate additional supply in a growth market.
Based on potential additional supply, CPM Group assume prices begin
to fall after 2040, despite a continually growing market.
Table: 3 Base Case vs Upside Case
Pricing (1) by
Product
|
Base Case Pricing |
Upside Case Pricing |
Year |
HPMSM($/t) |
HPEMM($/t) |
HPMSM($/t) |
HPEMM($/t) |
2027 |
3,266 |
8,197 |
3,266 |
8,197 |
2028 |
3,542 |
9,058 |
3,542 |
9,058 |
2029 |
3,810 |
9,893 |
3,810 |
9,893 |
2030 |
3,873 |
10,091 |
3,873 |
10,091 |
2031 |
4,094 |
10,780 |
4,094 |
10,780 |
2032 |
4,094 |
10,780 |
4,366 |
11,630 |
2033 |
4,094 |
10,780 |
4,658 |
12,541 |
2034 |
4,094 |
10,780 |
4,970 |
13,515 |
2035 – 2040 |
4,094 |
10,780 |
5,399 |
14,855 |
2041 |
4,094 |
10,780 |
5,120 |
13,984 |
2042 |
4,094 |
10,780 |
5,000 |
13,609 |
2043 |
4,094 |
10,780 |
4,760 |
12,860 |
2044 |
4,094 |
10,780 |
4,580 |
12,298 |
2045 |
4,094 |
10,780 |
4,400 |
11,736 |
2046 |
4,094 |
10,780 |
4,220 |
11,174 |
2047 |
4,094 |
10,780 |
4,040 |
10,612 |
2048 |
4,094 |
10,780 |
3,980 |
10,425 |
2049 |
4,094 |
10,780 |
3,920 |
10,238 |
2050 |
4,094 |
10,780 |
3,860 |
10,050 |
2051 |
4,094 |
10,780 |
3,860 |
10,050 |
Notes:
- The prices in Table 3 are real prices (i.e. excluding
inflation) as at 2021.
PROJECT SENSITIVITY
ANALYSIS
A detailed sensitivity analysis for the
Chvaletice Manganese Project was completed to determine the effects
of key variables in relation to the after-tax NPV of $1.34 billion
at a discount rate of 8%. The results of the sensitivity analysis
are presented in Tables 4 and 5 below.
As discussed above, Tetra Tech adopted a
risk-adjusted, short-term forecast of CPM Group’s pricing for the
base case. The upside case is based on CPM Group’s unaltered
forecast prices. The downside prices are the same average price
differences, in the reverse direction, between the short term (base
case) and the unaltered CPM Group forecast (upside case). This
results in -12.3% from the base case for HPMSM and -14.9% for HPEMM
for the downside case.
Table 4: Selected Financial Metrics
based on Price Sensitivities
Metrics |
Units |
Downside Case |
Base Case |
Upside Case |
HPMSM price (average LOP) |
$/t |
3,524 |
4,019 |
4,509 |
HPEMM price (average LOP) |
$/t |
8,974 |
10,545 |
12,075 |
Post-tax undiscounted cashflow |
($B) |
4.46 |
5.91 |
7.37 |
Post-tax NPV 6% |
($B) |
1.35 |
1.92 |
2.51 |
Post-tax NPV 8% |
($B) |
0.90 |
1.34 |
1.78 |
Post-tax NPV 10% |
($B) |
0.59 |
0.93 |
1.27 |
IRR |
(%) |
18.1 |
21.9 |
24.1 |
Payback period |
(years) |
5.0 |
4.1 |
4.1(1) |
Notes:
- Payback period
for upside case is the same as the base case as upside payback is
calculated on forecast pricing which is the same as the base case
pricing for the first 5 years of operations (as detailed in Table
3).
Table 5: After-Tax
NPV8% Sensitivity Analysis of
Initial Capex, Opex and Recoveries
Sensitivity |
-20%($/M) |
-10%($/M) |
Base Case($/M) |
+10%($/M) |
+20%($/M) |
Initial capital costs |
1,464.5 |
1,403.1 |
1,341.7 |
1,280.3 |
1,218.9 |
Total operating costs |
1,571.5 |
1,458.0 |
1,341.7 |
1,222.5 |
1,100.6 |
Recoveries |
914.1 |
1,127.9 |
1,341.7 |
1,555.5 |
1,769.3 |
CAPITAL COST SUMMARY
Capital expenditure estimates were prepared for
both initial and sustaining capital. A projected summary of
scheduled capital costs is shown in Appendix
2.
The expected initial capital expenditures for
the Project, inclusive of capitalized operating start-up costs, as
estimated by Tetra Tech, with inputs from Tractebel Engineering
a.s. ("Tractebel"), a Czech local engineering
firm, BGRIMM Technology Group (Beijing General Research Institute
of Mining and Metallurgy) ("BGRIMM"), Sudop Praha
a.s. ("Sudop") a Czech local engineering firm, and
EMN/Mangan Chvaletice, s.r.o. ("Mangan"), as of Q2
2022, are $757.3 million, including all development-related costs
incurred prior to the envisaged commencement of commercial
operations. Initial capital expenditures include $24.8 million of
growth capital, a provision for expected cost increases on known
expenditures. Contingencies on initial capital expenditures have
been added at appropriate percentages to each component of the
Project, excluding capitalized operating costs, resulting in an
overall contingency of $78.4 million or 15.6% of direct costs.
Capital costs incurred after start-up are assigned to sustaining
capital and are projected to be paid out of operating cash-flows
(see Table 6).
Table 6: Capital Cost
Estimate
Item |
Initial Capital($M) |
LOP Sustaining Capital($M) |
Overall site costs |
57.9 |
- |
Mining/tailings extraction |
4.6 |
6.1 |
Processing HPEMM |
295.1 |
28.0(1) |
Processing HPMSM, from 99.9% HPEMM |
42.2 |
Residue Storage Facility |
5.4 |
82.9 |
Onsite infrastructure |
98.1 |
- |
Sub-total direct costs |
503.3 |
117.0 |
Indirect costs |
128.4 |
- |
Owner’s costs |
47.2 |
- |
Contingency |
78.4 |
- |
Total capital costs |
757.3 |
117.0 |
Notes:
- Includes total LOP sustaining capex
for processing HPEMM and HPMSM.
Project Infrastructure
The Chvaletice Manganese Project is located
approximately 90km east of Prague in the Czech Republic, and is
served by excellent existing infrastructure, including rail,
highway, a gas pipeline, and water supply systems, and is adjacent
to an operating power plant. The proposed plant site is zoned for
industrial use and is the site of the former process plant that
produced the Chvaletice tailings.
New and refurbished infrastructure that will be
built to service the Project include: a tailings excavation and
handling facility; a south and north site connection utility bridge
for transporting tailings slurry, return water pipes and the tube
conveyor that returns a mixture of non-magnetic tailings and washed
leach residue to the residue dry stacking area; enclosed and
winterized process plant buildings and various reagent storage
facilities and product warehouse; an upgraded rail spur system with
related loading/unloading facilities; an internal road network; an
incoming electrical 400kV high voltage grid connection including
transformers, GIS switchgear, and local distribution step-down
transformers; a process equipment maintenance workshop; a mobile
fleet maintenance workshop; spare part and maintenance supply
warehouses; a comprehensive water management system, onsite
laboratories; and general administrative offices.
OPERATING COST SUMMARY
Onsite operating costs are expected to average
$194.79 per tonne plant feed ($4.43 per kg Mn equivalent) with
offsite operating costs estimated to average $19.75 per tonne plant
feed ($0.45 per kg Mn equivalent), as shown in Table 7.
Table 7: Operating Cost
Estimate
Item |
$/t of Plant Feed |
$/kg of Mn Equivalent |
LOP Total($M) |
Mining/tailings extraction costs |
2.44 |
0.06 |
64.9 |
Magnetic separation and processing to HPEMM |
123.35 |
2.81 |
3,286.6 |
Processing HPEMM to HPMSM |
19.83 |
0.45 |
528.4 |
Residue storage, site services and water treatment |
26.12 |
0.59 |
696.0 |
General & Administrative and other |
13.77 |
0.31 |
367.0 |
Contingency |
9.28 |
0.21 |
247.2 |
Sub-total onsite opex |
194.79 |
4.43 |
5,190.1 |
Freight and insurance, selling costs |
15.22 |
0.35 |
405.6 |
Czech government royalty(1) |
4.53 |
0.10 |
120.6 |
Sub-total offsite opex |
19.75 |
0.45 |
526.2 |
Total operating costs |
214.54 |
4.88 |
5,716.3 |
Notes:
- Czech government
royalty is 2,308 Czech Koruna (CZK) per tonne of Mn produced,
translated to USD at a projected CZK to USD exchange rate of
22.43.
Power
The Project is expected to consume approximately
490GWhr/year of baseload electrical energy, of which up to two
thirds will be required to power the operation of the
electrowinning circuit. The Company is actively engaged in
procuring a long term, stable supply of renewable, carbon-free
electricity for the Project and has engaged the services of Baringa
Services Ltd., a UK based power markets forecasting analyst.
Filtered Dry-Stacked
Tailings
High pressure filter press technology has been
adopted for the washing and dewatering of the tailings and leach
residue, which is considered an industry best practice. To realize
optimum material strength, several dewatering technologies were
tested and evaluated during the FS with the ultimate objective of
achieving average moisture content in the 23-25% range for ultimate
strength and stability, while minimizing water losses and
consumption.
CHVALETICE FEASIBILITY STUDY AND
TECHNICAL REPORT
The FS was prepared by Tetra Tech, an
independent engineering services group with extensive experience in
mineral processing, tailings management and mining. Tetra Tech
oversaw the project, the resource and reserve estimates and the
design of the mine and residue storage facility. BGRIMM acted as
lead process plant design engineer as well as completed validation
bench scale test work required in order to finalize the process
flowsheet. Tractebel provided Czech and European cost inputs,
localization, and GET s.r.o ("GET") and Bilfinger
Tebodin Czech Republic ("Tebodin") provided
environmental services. Sudop provided railway infrastructure
design.
The FS is based on a Proven and Probable Reserve
Estimate that will be detailed in the updated National Instrument
("NI") 43-101 Technical Report on the Chvaletice
Manganese Project. The NI-43-101 report will include results of the
FS and be filed within 45 days of this release on SEDAR at
www.sedar.com and made available on the Company’s website. The JORC
Technical Report is expected to be lodged with the Australian
Securities Exchange ("ASX") within the same time
period.
RESOURCE ESTIMATE
Tetra Tech was engaged to oversee the planning
and execution of sampling and assaying, to prepare the Resource
Estimate for EMN's Chvaletice Manganese Project, to prepare the
Technical Report in accordance with NI 43-101 - Standards of
Disclosure for Mineral Projects ("NI 43-101"), and
to prepare the independent JORC Code technical report in accordance
with the Joint Ore Reserves Committee Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves 2012 Edition ("JORC Code"). The 43-101
Technical Report, entitled “Technical Report and Mineral Resource
Estimate for the Chvaletice Manganese Project, Chvaletice, Czech
Republic”, with an effective date of December 8, 2018 (the
"Mineral Resource Estimate"), was filed on SEDAR
on January 28, 2019. No additional drilling or data collection
pertaining to the technical disclosure of mineral inventory has
been undertaken since the completion of the Mineral Resource
Estimate, and the effective date for the Mineral Resource Estimate
is revised to July 1, 2022. The Project's combined Measured and
Indicated Mineral Resources amount to 26,960,000 tonnes, grading
7.33% total manganese as detailed in Table 8 below.
Table 8: Chvaletice Mineral Resource
Statement (effective July 1, 2022)
Historic Tailings Cell |
In-situ Dry Bulk Density(t/m3) |
Volume(x1,000 m3) |
Tonnage(kt) |
Grade Mn(% total Mn) |
Cell #1 |
|
|
|
|
Measured |
1.52 |
6,577 |
10,029 |
7.95 |
Indicated |
1.47 |
160 |
236 |
8.35 |
Cell #2 |
|
|
|
|
Measured |
1.53 |
7,990 |
12,201 |
6.79 |
Indicated |
1.55 |
123 |
189 |
7.22 |
Cell #3 |
|
|
|
|
Measured |
1.45 |
2,942 |
4,265 |
7.35 |
Indicated |
1.45 |
27 |
39 |
7.90 |
Total Measured |
1.51 |
17,509 |
26,496 |
7.32 |
Total Indicated |
1.50 |
309 |
464 |
7.85 |
Combined Measured + Indicated |
1.51 |
17,818 |
26,960 |
7.33 |
Notes:
- Estimated in accordance with the
Canadian Institution of Mining ("CIM") Definition
Standards on Mineral Resources and Mineral Reserves adopted by CIM
Council, as amended, which are materially identical to JORC
Code.
- The Chvaletice Mineral Resource has
a reasonable prospect for eventual economic extraction. Mineral
Resources do not have demonstrated economic viability.
- Indicated Resources have lower
confidence that Measured Resources.
- A break-even grade of 2.18% tMn has
been estimated for the Chvaletice deposit based on preliminary
pre-concentration operating costs of US$6.47/t feed, leaching and
refining operating cost estimates of US$188/t feed, total recovery
to HPEMM and HPMSM of approximately 60.5% and 58.9%, respectively,
and product prices of US$9.60 kg/t for HPEMM and US$3.72 kg/t for
HPMSM (GPM Group Report, June 2022). The actual commodity price for
these products may vary.
- A cut-off grade has not been
applied to the block model. The estimated break-even cut-off grade
falls below the grade of most of the blocks (excluding 5,000 tonnes
which have grades less than 2.18% total Mn). It is assumed that
material segregation will not be possible during extraction due to
inherent difficulty of grade control and selective mining for this
deposit type.
- Grade capping has not been
applied.
- Numbers may not add exactly due to
rounding.
RESERVE ESTIMATE
Mineral Reserves for the Project are based on
the Measured and Indicated Resource and adhere to the guidelines
set by the Canadian Institute of Mining ("CIM"),
NI 43-101 and the CIM Best Practices. Material economic modifying
factors were applied to each block in the block model including
mined grade, contained metal, recovery rates for HPEMM and HPMSM,
mining operating cost, processing cost, (including EMM to MSM
conversion cost), residue placement cost, general and
administrative costs, site service costs, water treatment, shipping
cost, product insurance, and royalties. The Project’s combined
Proven and Probable Mineral Reserve amount to 26,644,000 tonnes,
grading at 7.41% total manganese as detailed in Table 9 below.
Table 9: Chvaletice Mineral Reserve
Statement (effective July 14, 2022)
Historic Tailings Cell |
In-situ Dry Bulk Density(t/m3) |
Volume(x1,000 m3) |
Tonnage(kt) |
Grade Mn(% total Mn) |
Cell #1 |
|
|
|
|
Proven |
1.51 |
6,651 |
10,132 |
7.83 |
Probable |
1.52 |
141 |
208 |
8.24 |
Cell #2 |
|
|
|
|
Proven |
1.53 |
7,929 |
12,106 |
6.91 |
Probable |
1.54 |
119 |
183 |
7.35 |
Cell #3 |
|
|
|
|
Proven |
1.46 |
2,744 |
3,979 |
7.49 |
Probable |
1.46 |
25 |
36 |
7.98 |
Total Proven |
1.50 |
17,325 |
26,217 |
7.35 |
Total Probable |
1.51 |
284 |
427 |
7.84 |
Combined Proven + Probable |
1.51 |
17,609 |
26,644 |
7.41 |
Notes:
- Estimated in accordance with the
CIM Definition Standards on Mineral Resources and Mineral Reserves
adopted by CIM Council, as amended, which are materially identical
to the JORC Code.
- The Mineral Resource is inclusive
of the Mineral Reserves.
- Probable Reserves have lower
confidence than Proven Reserves. Inferred Resources have not been
included in the Reserves.
- A break-even grade of 2.18% total
Mn has been estimated for the Chvaletice deposit based on
preliminary pre-concentration operating costs of $6.47/t feed,
leaching and refining operating cost estimates of $188/t feed,
total recovery to HPEMM and HPMSM of approximately 60.5% and 58.9%
respectively and product prices of US$9.60 kg/t for HPEMM and
US$3.72 kg/t for HPMSM (CPM Group Report, June 2022). The actual
commodity price for these products may vary.
- Grade capping has not been
applied.
- Numbers may not add exactly due to
rounding.
- Minimal dilution and losses of
<1% are expected to occur at the interface between the lower
bounds of the tailings cells and original ground as the surface is
uneven.
PROCESSING FACILITIES
Tailings Extraction, Residue Storage
Facility and Reclamation
In the tailings extraction plan, the three
tailings cells will be excavated in a counter clockwise sequence,
starting with Cell #3, followed by Cells #1 and #2. Tailings will
be extracted using shovel excavators and hauled by truck to an
intermediate re-pulping and a covered storage station located
between Cells #1 and #2. The storage station will create a 5-day
material stockpile. Re-pulped tailings will be fed to the magnetic
separation plant via a slurry pipeline on a continuous basis.
A blend of non-magnetic tailings and washed
leach residue materials from the process plant will be conveyed
using a tube conveyor to the storage station and placed and
compacted in the Residue Storage Facility ("RSF").
The excavated area exposed after extraction of the existing
tailings will be lined with a geomembrane liner. The facility will
be constructed in stages to suit tailings storage requirements and
to minimize the footprint of tailings exposed to the air at any
given time.
Design features of the filtered tailings storage
facility include a geomembrane lined bottom, perimeter surface
water diversion and a contact water collection system that is
integrated with the overall site water management system. Dust
management includes the implementation of modern dust suppression
methods on open faces, interim stack surfaces and haul roads, as
required.
Progressive reclamation will be undertaken as an
integrated part of the tailings stacking procedure. The tailings
stack cover will consist of a low permeability soil and/or
geomembrane cover to inhibit erosion and infiltration, and a growth
layer to support vegetation growth.
The site is expected to be fully reclaimed and
brought back into productive community use to be established in
consultation with local communities, regulators and national
government agencies. The RSF will be monitored during the
post-closure period for geotechnical and environmental
performance.
Table 10: Feasibility Study Tailings
Extraction, Processing and Production Plan
|
Year 12027 |
Year 22028 |
Year 32029 |
Years
4-252030-2051(Average) |
TotalLOP |
Tailings milled (kt)(1) |
718 |
1,113 |
1,107 |
1,078 |
26,644 |
Mn grade (%)(1) |
7.98 |
7.41 |
7.44 |
7.39 |
7.41 |
Contained Mn (kt) |
57.3 |
82.5 |
82.4 |
79.6 |
1,973.5 |
HPEMM produced (kt)(2) |
32.1 |
50.1 |
50.1 |
48.3 |
1,194.5 |
HPEMM converted to HPMSM (kt)(2) |
21.7 |
33.4 |
33.4 |
33.4 |
822.3 |
HPMSM produced (kt) |
65.0 |
100.0 |
100.0 |
100.0 |
2,465.0 |
Total Mn production (kt) |
31.5 |
49.1 |
49.1 |
47.4 |
1,171.9 |
Overall recovery (%)(3) |
55.0 |
59.6 |
59.6 |
59.3 |
59.4 |
Notes:
- Tonnage and grade in Table 10 were
calculated by Tetra Tech and includes an overall 0.5% manganese
loss factor and no dilution.
- Approximately two-thirds of the
annual HPEMM production is converted to HPMSM on site, with the
balance being sold as HPEMM.
- The combined overall recovery of
manganese from tailings to high purity manganese products is
estimated to be 59.4% over the life of the Project, excluding the
extraction manganese loss factor of 0.5%. Manganese recoveries in
the production of HPEMM and HPMSM are expected to average 60.5% and
58.9%, respectively.
For a production table by year, please see
Appendix 2.
High-Purity Manganese Processing
Facilities
The processing facilities, including ancillary
facilities for HPEMM and HPMSM production from the CMP tailings
were designed by BGRIMM together with EMN and Tetra Tech, based on
the comprehensive metallurgical test results conducted during the
Preliminary Economic Assessment and validated through bench scale
tests during the feasibility study. The design work included
process circuit and process equipment optimization. Mass, energy,
and water balances were simulated and estimated by a combination of
METSIM modelling, calculations using results from the metallurgical
test work program, and BGRIMM’s experience. Key equipment items
were sized and selected by the design team incorporating inputs
from potential Chinese equipment vendors.
The CMP process plant has been designed to a
name plate nominal production capacity of 50,000 tonnes per annum
of HPEMM by extracting approximately 1.1 million tonnes of tailings
per year. Two-thirds of the annual HPEMM flake production is
expected to be converted to approximately 100,000 tonnes per annum
of HPMSM (32.24% Mn). This product mix is expected to best meet the
high purity manganese market demand anticipated in current and
future low-cobalt lithium-ion battery formulations. The HPEMM
product containing >99.9% manganese is expected to be sold as
flakes and will be produced without the use of selenium and
chromium. The CMP HPMSM product is designed to contain no less than
99.9% high purity manganese sulfate monohydrate and a minimum of
32.34% manganese and will be sold in powder form, produced without
the use of fluorine. The proposed process flow sheet is illustrated
in Figure 1 below.
Figure 1: FS Simplified Process
Flowsheet
The major steps in the CMP flow sheet are:
-
Excavated tailings will be re-pulped and pumped via a pipeline
carried by an overhead bridge that will cross a highway and a
railway line and related spurs that adjoin the process plant site
located immediately south of the tailings piles.
-
The tailings slurry will be upgraded in a wet, high-intensity
magnetic separation circuit that upgrades the manganese grade of
the leach feed to approximately 15% total manganese and rejects
approximately 58% of the feed to non-magnetic tailings, with an
expected 86% manganese recovery. The magnetic concentrate and
non-magnetic tailings produced will be dewatered using thickeners
and filters. The concentrate will be fed to the downstream leach
process and the dewatered tailings, together with the washed leach
residue will be dry stacked in the RSF.
-
The magnetic concentrate cake will be re-pulped and leached using
dilute sulfuric acid and residual acid from manganese
electrowinning circuit. Neutralization of the slurry will be
achieved using hydrated lime. Air sparging of the neutralized
slurry will be used to cost-effectively coprecipitate the
substantial quantities of impurities that leach with the manganese.
The leach pulp will be filtered in automatic pressure filters to
separate pregnant leach solution from the leach residue.
-
The leach residue will then be washed with process water in an
on-stream washing/filtration circuit using pressure filtration
prior to co-disposal with the non-magnetic separation tailings in a
lined dry-stack tailings storage facility that will be
progressively constructed in excavated areas of the CMP tailings
cells.
-
The wash water from the leach residue washing circuit will be
treated for manganese and ammonia recovery to minimize manganese
and ammonia losses. The wash water recovery system recovers
manganese units to the leaching circuit in the form of manganese
carbonate. The spent wash water solution will be treated to recover
ammonia using a conventional lime boil process and will produce a
gypsum by-product. The recovered ammonia will be reused in the
HPEMM production circuits. The inclusion of the leach residue
washing circuit with its associated wash water recovery circuit is
expected to be a world-leading industry practice for the
hydrometallurgical processing of manganese ores. Returning washed
tailings to the carefully prepared containment cells in the
excavated areas of the tailings progressively remediates the
environmental impact risks of legacy mining operations.
-
The pregnant solution from the leaching circuit will be purified to
remove heavy metals and other impurities and stabilized to prevent
uncontrolled crystallization of salts to produce the solution for
the downstream electrowinning process.
-
Electrowinning will be conducted in electrowinning cells. The tank
house will have the capacity to produce 50,000 t/annum HPEMM using
an energy efficient and selenium free process. The proposed
electrowinning circuit is designed to have a plating cycle of 24
hours at a cell voltage of 4.2 to 4.4 V and an average
cathode-current density of 320 to 370 A/m2. Cathodes will be
harvested using semi-automatic harvesting machines, washed, and
stripped of electrodeposited manganese metal using
industry-standard automatic cathode plate stripping machines.
Approximately two thirds of the HPEMM flakes will then be used as
feed for HPMSM production. The remaining HPEMM flakes will be
packed and directly shipped to customers for onsite dissolution
and/or the sale of flakes.
-
A magnesium removal process has been incorporated into the process
plant design to ensure efficient electrowinning operations and
high-quality product. The magnesium removal process will maintain
the magnesium concentration in the electrowinning solutions at a
level that prevents uncontrolled precipitation of salts and
scaling. The process uses low cost reagents without incurring
significant losses of manganese and reagent units.
-
The base case FS production plan proposes to dissolve approximately
two-thirds of the HPEMM flakes using sulfuric acid to produce
100,000 t/annum of HPMSM powder in a dust-free chemical processing
facility. The dissolved HPMSM solution will be further purified to
remove trace impurities carried by the HPEMM flakes. This plant
design assumes the feed solution will be concentrated using an
energy efficient, low temperature mechanical vapor recompression
(MVR) crystallization process to generate a single specification of
manganese sulfate monohydrate crystals. The HPMSM crystals will be
separated from the saturated crystal slurry using centrifuges. The
dewatered crystals will be dried using disc dryers to produce the
final HPMSM powder, while the spent feed solution returns to the
HPEMM dissolution circuit. The dried HPMSM powder product will be
packed prior to being shipped in trucks or containers to customers
throughout the EU.
ENVIRONMENT, PERMITTING AND
COMMUNITIES
Environmental Baseline
Studies
The vicinity around the Chvaletice tailings area
has been significantly impacted by past mining and related heavy
industrial activities. Mining activity at Chvaletice ended in 1975.
Czech law exempts landowners and developers from impacts prior to
1989, when communism ended in then Czechoslovakia.
Since 2017, GET, a Czech mining, geological and
environmental services firm, has produced several studies for the
Project, including environmental baseline studies. These included
ecosystem mapping, documentation of the physical and environmental
characteristics of the CMP site and an assessment of land use plans
of the adjoining municipalities. Significant local features were
recorded, including sensitive and protected areas, vegetation,
landscape elements, and areas or sites of historical, cultural,
archaeological or geological importance. Climate, air, water, soil,
natural resources, fauna, flora and ecosystems, landscape and
population of the area were inventoried. The baseline studies
provide an overall assessment of the environment conditions that
prevail in the Project area.
Due to the location of the CMP on the shore of
the Labe River and overlying a shallow aquifer in the Labe Valley,
there are environmental sensitivities related to ongoing tailings
runoff and impacts to local groundwater. Currently, EMN has
knowledge of impacted groundwater caused by the historical mining
and processing activity in the area, particularly the ongoing
leaching of metals from the tailings. The Company continues to
regularly monitor these impacts in groundwater wells. The Company
expects that its proposed reprocessing and remediation of the
historic Chvaletice tailings will result in halting ongoing
groundwater pollution caused by the existing unlined tailings
facility.
Environmental and Social Impact
Assessment
In 2019-2020, Bilfinger Tebodin Czech Republic
conducted the Preliminary Environmental and Social Impact
Assessment ("PESIA" or "EIA
Notification") as the first stage of environmental
assessment of the Project. Several detailed expert studies were
prepared including a comprehensive site wide Biological Survey, a
detailed Air Dispersion model and Study, an Acoustic/Noise Impact
Study, a Road and Rail Transportation Study, a site wide
Hydrogeological Survey, a Health Impact Assessment, an Impact on
Landscape Character study and a Reclamation and Remediation Study.
A screening decision summarizing all received comments on the
Company’s EIA Notification was published by the Ministry of
Environment ("MoE") in December 2020.
No crucial objections and comments were raised
within the first phase of the project's environmental impact
assessment (screening procedure). Requirements arising from the
first stage of environmental and social assessment were
incorporated into the FS and Project Design.
The second and final stage of the Project’s
Environmental and Social Impact Assessment
("ESIA") is being concluded and is expected to be
submitted to the Czech MoE in September 2022. The ESIA will include
a detailed description of:
- The manganese production process and resulting environmental
footprint of the Project;
- Results of baseline and other studies conducted to date;
- Health, safety and environmental management plans;
- Impact assessment, impact mitigation and avoidance
plans/measures;
- Socio-economic impacts on local communities;
- Reclamation plans/objectives; and
- Acoustic and dispersion modeling results.
Permitting
The Czech firm, GET has provided localization
services for EMN that identified local requirements and permits
required for the CMP. Other work included a review of local
regulatory requirements for the permitting process and a review of
Czech environmental regulations, standards and environmental
practices, including wastewater, waste and tailings storage, air,
noise and other regulations.
Community Engagement
EMN has pro-active and regular consultation with
community stakeholders, which is expected to intensify as the CMP
advances. The Company’s subsidiary, Mangan operates a Project
Information Center in the Town of Chvaletice’s Municipal Culture
House, to provide residents with opportunities to learn about the
CMP, aid in developing relationships with the Company, and to
provide feedback and suggestions during Project development.
Mangan’s registered office is also located in Chvaletice, a step
towards ultimately basing its Czech head office in this
municipality, close to operations.
Benefits to Stakeholders
- The Project results in the
remediation of a historic mine site, where metals and other
compounds currently leach into the groundwater. As extraction,
reprocessing and proper disposal of the Chvaletice historic
tailings is carried out, the site will be progressively
rehabilitated to be in compliance with Czech and European
environmental requirements.
- The Company has extensively engaged
and plans to continue meaningful consultation with local residents,
communities, organizations and regulatory agencies, soliciting
active local participation and input in the Project’s evaluation
and planning process.
- Since the inception of the Project,
the Company has sought out, trained and helped to develop numerous
talented Czech professionals. EMN expects that the Project would
employ mostly local people during construction and operations.
- During the 25-year life of project,
benefits to the Czech State and local communities would include the
employment of approximately 400 people and an estimated $1.5
billion in revenues generated from corporate taxes and
royalties.
NEXT STEPS
With the Feasibility Study now complete, the
Company continues to focus on the key milestones to enable a final
investment decision, which include:
- Submission of the ESIA to the Czech
MoE, expected this quarter, followed by its approval targeted in
the first half of 2023;
- Rezoning of the remaining land area
underlying the tailings for mining use, which the Company
anticipates being approved by the Municipality of Chvaletice by the
end of 2022;
- Negotiating and completing the
remaining land agreements, which would provide access to the
outstanding 70% of the total land area required for the
Project;
- Entering a contract to provide
engineering, procurement, construction management
("EPCM") support to the Project;
- Executing binding offtake
agreements for EMN’s high-purity manganese products to support
project financing; and
- Developing an optimum financing
structure for the Project, which is dependent upon the above
milestones being achieved.
There is the risk that certain of the above key
milestones may take longer than expected, or the Company may not be
able to achieve certain milestones, which could materially delay or
affect the success of the Project.
PROJECT FINANCING
Euro Manganese recently appointed Stifel as
financial adviser to assist with the structuring and securing of
financing for the Project of $757.3 million as well as a working
capital facility. The FS confirms several factors, outlined below,
that make the Project an attractive proposition for potential
financial partners. Consequently, the Company has reasonable
grounds to assume that it will be able to fund the development of
the Project.
- Robust project
economics – the FS outlines strong project economics at
base case, with long project life and sufficient operating margin
to sustain debt financing.
- In-demand products
– as the only sizable manganese resource in Europe, the Project
provides a fully-traceable and secure supply of high-purity
manganese products for European cathode makers, battery makers, and
automotive OEMs.
- Unique environmental
credentials – the reprocessing and rehabilitation of
historic tailings results in net positive environmental benefits to
water and soil quality over the life of the Project and the
Project’s low carbon footprint also contributes to responsibly
produced HPEMM and HPMSM, a sought-after attribute as automotive
manufacturers use strategic procurement to meet their targets of
lower emissions across their supply chains. The Company has
conducted a Life Cycle Assessment that quantifies the Project's
environmental impacts, the results of which are expected to be
received and released soon.
- Excellent
jurisdiction – located in the heart of Europe, in a stable
and business-friendly jurisdiction, the Project is well-positioned
to capitalize on the growth in the European EV market.
- Strong support from leading
European institutions – the Company has existing
relationships with European financial institutions, some of which
are already strategic investors in EMN, who have expressed interest
in being potential cornerstone debt providers subject to due
diligence.
COMPENTENT AND QUALIFIED PERSON(S)
STATEMENT
All production targets for the Chvaletice
Manganese Project referred to in this news release are underpinned
by estimated Proven and Probable Reserves prepared by Competent
Persons and Qualified Persons in accordance with the requirements
of the JORC Code and NI 43‐101, respectively. Additionally, the
scientific and technical information included in this news release,
is based upon information prepared and approved by Mr. James Barr,
P. Geo, Senior Geologist, Mr. Jianhui (John) Huang, Ph.D., P. Eng.,
Senior Metallurgical Engineer, Mr. Hassan Ghaffari, P.Eng, M.A.Sc.,
Senior Process Engineer, Mr. Chris Johns, P.Eng, Senior
Geotechnical Engineer, Davood Hasanloo, P.Eng, M.A.Sc., Senior
Hydrotechnical Engineer, and Mrs. Maurie Marks, P.Eng, Senior
Mining Engineer, all with Tetra Tech and Ms. Andrea Zaradic, P.
Eng., Vice President Operations for Euro Manganese. Mr. Barr, Mrs.
Marks, Mr. Ghaffari, Mr. Johns, Mr. Hasanloo and Mr. Huang are
consultants to, and independent of, EMN within the meaning of NI
43-101, and have sufficient experience in the field of activity
being reported to qualify as Competent Persons as defined in the
JORC Code, and are Qualified Persons, as defined in NI 43-101. Mr.
Barr is responsible for the Mineral Resource Estimate and data
verification, Mr. Huang is responsible for the metallurgical test
work results, process engineering, operating cost and capital cost
estimates, Mr. Ghaffari is responsible for infrastructure, Mr.
Hasanloo is responsible for mine site water management and overall
site water balance, Mrs. Marks is responsible for conversion of the
Mineral Resources to Mineral Reserves, and mining and financial
analysis, Mr. Johns is responsible for design of the residue
storage facility, and Ms. Zaradic is responsible for environmental
studies, permitting, and social or community impact. Mr. Barr
verified the data for the resource estimate, and other qualified
persons verified data for their responsible sections. Mr. Barr
visited the property during the 2017 drilling program and again
during the 2018 drilling campaign, on July 30-31st, 2018, during
which time he observed the drilling, sample collection and
preparation, sample logging and sample storage
facilities. Mr. Huang visited the Project on February
5, 2018 and May 2022, as well as visited the Changsha Research
Institute for Mining and Metallurgy (“CRIMM”)
laboratory and pilot plant facility five times between January 20,
2017 and September 20, 2018 to witness sample preparation and
test/assay facilities and to discuss the test program and results
with CRIMM’s technical team. Mr. Huang also visited the SGS
Minerals Services (SGS) laboratory on June 29, 2017 and visited
BGRIMM’s laboratory four times between September 3, 2019 to January
25, 2020. Mr. Huang oversaw the bench scale validation test work
and discussed test work program and results with BGRIMM’s technical
team. Mrs. Marks, Mr. Johns and Mr. Ghaffari also visited the
project site in May 2022. Ms. Zaradic visited the project site in
April 2019 and May 2022.
Messrs. Barr, Huang, Ghaffari, Johns, Hasanloo
and Mrs. Marks have no economic or financial interest in the
Company and each consent to the inclusion in this news release of
the matters based on their information in the form and context in
which it appears.
In addition, technical information concerning
the Chvaletice Manganese Project is reviewed by Ms. Andrea Zaradic,
P. Eng, VP Operations for Euro Manganese, and a Qualified Person
under NI 43-101. Ms. Zaradic has reviewed and approved the
information in this news release for which she is responsible and
has consented to the inclusion of the matters in this news release
based on the information in the form and context in which it
appears.
NON-IFRS MEASURES
The Company has included certain non-IFRS
performance measures as detailed below. These are common
performance measures but may not be comparable to similar measures
presented by other issuers and the non-IFRS measures do not have
any standardized meaning. Accordingly, it is intended to provide
additional information and should not be considered in isolation or
as a substitute for measures of performance prepared in accordance
with IFRS.
EBITDA - Earnings before interest, taxes,
depreciation and amortization is a measure of profitability and
includes the Company’s earnings, less each of the items in its name
as well as impairment losses, working capital and capital
expenditures. While EBITDA may vary between companies and between
industries, the Company believes that this measure will be useful
to external users in assessing operating performance.
Working capital – The Company has disclosed its
initial working capital needs which include accounts receivables
and inventories, but not deducted accounts payable, income taxes
payable and other accrued liabilities which would generally be
included in the definition of working capital. While working
capital may vary between companies and between industries, the
Company believes that this measure will be useful to external users
in assessing the initial cash requirements needed to fund the
Project.
CAUTIONARY STATEMENT
The Feasibility Study (also referred to as “FS”
throughout) referred to in this announcement is intended to be used
for the process of financing the construction of the Chvaletice
Manganese Project by outlining the technical, commercial and profit
potential aspects of the Project. The technical and economic study
has a number of sections of that have accuracy ranges from ± 5% to
± 20% depending on the materiality of the section. The overall
accuracy of the FS is judged to be in the order of -15% to +20%.
The directors of the Company consider this to be a fair and
balanced summary of the study undertaken. However, given the
uncertainties involved in any study of this type, and the
assumptions made, investors should not make any investment
decisions based solely on the results of the FS and/or the summary
contained herein.
The FS is based on the material assumptions
outlined in this news release which include assumptions about the
availability of funding. While EMN considers all of the material
assumptions to be based on reasonable grounds, there is no
certainty that they will prove to be correct or that the range of
outcomes indicated by the FS can be achieved.
While the Company believes it has reasonable
grounds to assume it will be able to fund the development of the
Project, as described herein under “Project Financing,” investors
should note that there is no certainty that it will be able to
raise that amount of funding when needed. It is also likely that
such funding may only be available on terms that may be dilutive to
or otherwise affect the fundamental value of EMN’s existing
shares.
ABOUT EURO MANGANESE INC.
Euro Manganese Inc. is a battery materials
company focused on becoming a leading, competitive, and
environmentally superior producer of high-purity manganese for the
electric vehicle (EV) industry and other high-technology
applications. The Company is advancing development of the
Chvaletice Manganese Project in the Czech Republic, which is a
unique waste-to-value recycling and remediation opportunity
involving reprocessing old tailings from a decommissioned mine. The
Chvaletice Project is the only sizable resource of manganese in the
European Union, strategically positioning the Company to provide
battery supply chains with critical raw materials to support the
global shift to a circular, low-carbon economy.
Authorized for release by the CEO of Euro
Manganese Inc.
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) or the ASX accepts responsibility for the
adequacy or accuracy of this release.
INQUIRIES
Dr. Matthew JamesPresident
& CEO+44 (0)747 229 6688
Louise BurgessSenior Director
Investor Relations & Communications+1 (604)
312-7546lburgess@mn25.ca
Company Address: #709 -700 West Pender St.,
Vancouver, British Columbia, Canada, V6C
1G8Website: www.mn25.ca
FORWARD LOOKING STATEMENTS
Certain statements in this news release
constitute “forward-looking statements” or “forward-looking
information” within the meaning of applicable securities laws. Such
statements and information involve known and unknown risks,
uncertainties and other factors that may cause the actual results,
performance or achievements of the Company, its projects, or
industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements or information. Such statements can be
identified by the use of words such as “may”, “would”, “could”,
“will”, “intend”, “expect”, “believe”, “plan”, “anticipate”,
“estimate”, “scheduled”, “forecast”, “predict” and other similar
terminology, or state that certain actions, events or results
“may”, “could”, “would”, “might” or “will” be taken, occur or be
achieved.
Results of the Feasibility Study constitutes
forward-looking information or statements, including but not
limited to estimates of internal rates of return (including any
pre-tax and after-tax internal rates of return), payback periods,
net present values, future production, assumed prices for HPMSM and
HPEMM, ability of the Company to achieve a pricing premium for its
products, proposed extraction plans and methods, operating life
estimates, cash flow forecasts, metal recoveries and estimates of
capital and operating costs. Such forward-looking information or
statements also include, but are not limited to, statements
regarding the Company’s intentions regarding the Project in the
Czech Republic, the development of the Project, the ability to
source green power and other requirements for the Project, the
completion and submission of an environmental and social impact
assessment, statements regarding the ability of the Company to
obtain remaining surface rights, the net positive benefits of the
Project, the growth and development of the high purity manganese
products market, the desirability of the Company’s products, the
growth of the EV industry, the use of manganese in batteries, the
manganese project supply line, support from European financial
institutions, and the Company’s ability to obtain financing for the
Project.
Readers are cautioned not to place undue
reliance on forward-looking information or statements.
Forward-looking information and statements involve significant
risks and uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indicators of whether or not such results will be achieved.
Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of the Company to
differ materially from those discussed in the forward-looking
statements and, even if such actual results are realized or
substantially realized, there can be no assurance that they will
have the expected consequences to, or effects on, the Company.
Factors that could cause actual results or
events to differ materially from current expectations include,
among other things: the ability to develop adequate processing
capacity; the availability of equipment, facilities, and suppliers
necessary to complete development; the cost of consumables and
extraction and processing equipment; risks and uncertainties
related to the ability to obtain, amend, or maintain necessary
licenses, or permits, risks related to acquisition of surface
rights; risks and uncertainties related to expected production
rates; timing and amount of production and total costs of
production; the potential for unknown or unexpected events to cause
contractual conditions to not be satisfied; the failure of parties
to contracts with the Company to perform as agreed; risks and
uncertainties related to the accuracy of mineral resource and
reserve estimates, the price of HPEMM and HPMSM, power supply
sources and price, reagent supply resources and prices, future cash
flow, total costs of production, and diminishing quantities or
grades of mineral resources and reserves; changes in Project
parameters as plans continue to be refined; risks related to global
epidemics or pandemics and other health crises, including the
impact of the novel coronavirus (COVID-19); availability and
productivity of skilled labour; risks and uncertainties related to
interruptions in production; unforeseen technological and
engineering problems; the adequacy of infrastructure; risks related
to Project working conditions, accidents or labour disputes; social
unrest or war; the possibility that future results will not be
consistent with the Company's expectations; risks relating to
variations in the mineral content and grade within resources from
that predicted; variations in rates of recovery and extraction;
developments in EV battery markets and chemistries; and risks
related to fluctuations in currency exchange rates, changes in laws
or regulations; and regulation by various governmental agencies.
For a further discussion of risks relevant to The Company, see
"Risk Factors" in the Company's annual information form for the
year ended September 30, 2021, available on the Company's SEDAR
profile at www.sedar.com.
All forward-looking statements are made based on
the Company's current beliefs as well as various assumptions made
by the Company and information currently available to the Company.
Generally, these assumptions include, among others: the presence of
and continuity of manganese at the Project at estimated grades; the
ability of the Company to obtain all necessary land access rights;
the availability of personnel, machinery, and equipment at
estimated prices and within estimated delivery times; currency
exchange rates; manganese sales prices and exchange rates assumed;
growth in the manganese market; appropriate discount rates applied
to the cash flows in economic analyses; tax rates and royalty rates
applicable to the proposed operations; the availability of
acceptable Project financing; anticipated extraction losses and
dilution; success in realizing proposed operations; and anticipated
timelines for community consultations and the impact of those
consultations on the regulatory approval process.
Although the forward-looking statements
contained in this news release are based upon what management of
the Company believes are reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with these
forward-looking statements. These forward-looking statements are
made as of the date of this news release and are expressly
qualified in their entirety by this cautionary statement. Subject
to applicable securities laws, the Company does not assume any
obligation to update or revise the forward-looking statements
contained herein to reflect events or circumstances occurring after
the date of this news release.
APPENDIX 1 JORC CODE
2012 Edition Table 1 Disclosure
SECTION 1 Sampling Techniques and
Data
Criteria |
Explanation |
Sampling Techniques |
- The 2018 sampling program is
summarized as:
- Sonic rig advanced at 2 m
intervals using 100mm core tube, approx. 14 kg wet weight per
sample.
- 730 core samples (2 m) of
tailings material were recovered for analysis.
- Samples extracted from core tube at
1 m subsamples (approx. 7 kg wet weight) for logging and
physical measurements.
- A quarter split (approx. 3.5 kg
wet weight) was extracted from the 1 m subsamples, recombined
with the corresponding 1 m quarter split subsample, bagged and
shipped to SGS for particle size analysis, lithogeochemistry,
metals analysis and bulk density testing (approx. 7 kg for 2 m
representative sample.
- Remaining ¾ sample was split for
additional test work in Czech Republic, and for metallurgical test
work in China.
- All samples were clearly labelled
and stored in vacuum-packed and sealed plastic bags to preserve
original moisture content and prevent sample deterioration.
Geochemical samples were contained in plastic buckets, inventoried
and stored in a locked facility in Prelouc, Czech Republic, prior
to being shipped to SGS Bor.
|
Drilling Techniques |
- The 2018 program completed drilling
of 1,509.5 metres in 80 holes.
- The program included completion of
35 vertical and 19 inclined 100 mm diameter Sonic holes, totaling
1,409.5 m, and an additional 26 mobile percussion drill holes,
totaling 100 m, were completed around the perimeter embankments of
the tailings piles in areas which were not previously accessed for
sampling.
- Sonic holes were placed as infill
holes with approximately 75 metre spacing between 2017 holes and as
inclined directed underneath the outer perimeter embankment, using
100 mm diameter size rods and sonic core barrel advance
provided by Eijkelkamp SonicSampDrill B.V. and crews from Giesbeek,
the Netherlands.
|
Drill Sample Recovery |
- Recoveries estimated by field crew
and recorded on geological logs.
- No casing was installed and drill
rods were pulled for each core run.
|
Logging |
- Logging was conducted in the field
at drill side by GET sro, on hard copy paper and transcribed into
digital drillhole database.
- Records include lithological
description, wet mass, estimated recovery, and volume.
|
Subsampling Techniques and Sample Preparation |
- Sampling excludes overlying topsoil,
and underlying native soil substrate.
- Assay samples received at SGS Bor
were weighed (wet) and homogenized by hand using the “Japanese slab
cake method” of kneading and rolling the sample.
- A 500 g subsample sent to laser
diffraction particle size analysis.
- The remaining sample was dried (105
degrees C) and homogenized.
- 1 kg was extracted for
pulverization to 95% passing 75µm mesh.
- First stage of analysis was
conducted SGS in Bor, Serbia, which included partial digestion
using aqua regia with ICP/MS or AAS, and near total digestion using
four acids (nitric, perchloric, hydrofluoric and hydrochloric) with
ICP/MS or AAS from 0.5g aliquots.
- The second stage of analysis was
conducted at SGS in Lakefield, Ontario, Canada, which included
using lithium borate fusion and x-ray fluorescence (XRF) for major
concentration of major cation oxide, concentration of in organic
sulphur and carbon using LECO furnace, measurement of specific
gravity by pycnometer, and for particle size analysis by
LD-PSA.
- Total of 888 samples were analyzed
at SGS laboratories.
|
Quality of Assay Data and Laboratory Tests |
- Quality control (QC) protocol
included insertion of field duplicates (5%), blank (4%) and
certified reference samples (5%) in all drill holes, collection of
sample preparation duplicate (5%) and pulp duplicates (2%).
- Three holes were drilled in 2018 to
twin holes completed in 2017.
- A database was compiled, and various
checks and measures were performed by Tetra Tech. No significant
quality assurance (QA) concerns were identified by the Competent
Person.
|
Verification of Sampling and Assaying |
- Independent analyses were conducted
by an external umpire laboratory; Activation Laboratories, located
in Ancaster, Ontario, Canada. The lab received 96 representative
samples (approximately 1 in 10).
- Independent CP sampling was
conducted.
|
Location of Data Points |
- Property topography was provided by
GET sro in Czech projection S-JTSK using the Bpv datum.
- Surveying of drill hole collars was
completed on-site by GET using a Trimble model R4 GNSS global
positioning system (GPS) receiver equipment.
|
Data Spacing and Distribution |
- Infill Sonic holes (35) were spaced
at approximately 100 m, giving approximately 75m overall
average spacing including the 2017 drill holes.
- Perimeter Sonic holes (19) were
inclined at 45 degrees and spaced at two holes per side of the
tailings cells.
- Perimeter percussion holes (26) were
drilled vertically and spaced at approximately two to three holes
per side of the tailings cells.
- Downhole sampling continuous at
2 m intervals.
|
Orientation of Data in Relation to Geological
Structure |
- Drillholes were drilled both
vertically and inclined through heterogeneous tailings mass.
|
Sample Security |
- Samples stored at a field warehouse
managed by Geomin in Jihlava prior to shipping to laboratory for
analyses.
|
Audits or Reviews |
- Independent site visit, sampling and
data review completed by Tetra Tech Competent Person, James Barr,
P.Geo., during the delineation drilling campaign on July 30-31st,
2018.
|
SECTION 2 Reporting of
Exploration Results
Criteria |
Explanation |
Mineral Tenement and Land Tenure Status |
- Mangan is a private company
established in the Czech Republic in 1997, is 100% owned by Euro
Manganese Inc., and holds 100% ownership of exploration licence
number 631/550/14-Hd (which was valid until September 30, 2019, but
on December 4, 2018 was renewed and extended to May 31, 2026) and
exploration licence number MZP/2018/550/386-Hd (valid until May 31,
2026).
- Exploration licence number
631/550/14-Hd is registered to include mineral rights on a total
area of 0.98 km² (98 ha) which cover the Chvaletice Manganese
Project deposits, of which 0.82 km² is located within the
Municipality of Trnavka, and 0.16 km² is located within the
Municipality of Chvaletice.
- Exploration licence
MZP/2018/550/386-Hd allows the company to drill on the perimeter of
the tailings piles.
- On April 28, 2018, Mangan was issued
a Preliminary Mining Permit by the Ministry of Environment, Licence
No. MZP/2018/550/387-HD which covers the areas included in the
Exploration Licences and secures Mangan’s rights for the entire
deposit area and is a prerequisite for the application for the
establishment of the Mining Lease District.
- On July 20, 2021, Mangan was issued
a new Preliminary Mining Permit, Licence No. MZP/2021/550/92-Hd,
valid until May 31, 2026.
- At present, Mangan does not hold
surface rights to the Chvaletice Manganese Project area, which are
considered as those lands of original ground elevation surrounding
and immediately underlying the protected area that contains
tailings Cells 1, 2, and 3. The area of interest for the
Chvaletice Manganese Project overlies and adjoins 18 privately
owned land parcels.
- An aggregated land package covering
26.64 ha has been purchased, or has option agreement to be
purchased, by Mangan. The parcel of land is proposed for
development and construction of a high-purity manganese processing
facility and related infrastructure.
|
Exploration Done by Other Parties |
- Hand auger sampling in 2014, four
holes ranging from 2 to 2.5 m depth.
- Testpit sampling in 2015, seven
testpits ranging between 1.8 to 3.8 m depth.
|
Geology |
- The mineralization found in tailings
at the Chvaletice Manganese Project deposited by manmade processes
following grinding and flotation processes of black pyritic shale
and is therefore not characteristic of a traditional bedrock hosted
manganese deposit.
- The material can be physically
characterized as a compacted soil, with varying degrees of particle
sizes from clay to coarse sand.
- Mineralogy has been quantified by
limited x-ray diffraction (XRD) analyses, with resulting manganese
bearing mineral phases as rhodochrosite (and other Mn-bearing
carbonates), spessartine (and other Mn-silicates); quartz was the
main gangue mineral, and pyrite was the main sulphide mineral.
|
Drill Hole Information |
- Drillholes were collared on the
surface of the tailings deposits and drilled vertically downwards
to completion in the underlying native soil substrate, approximate
average depth in Cell 1 = 26 metres, Cell 2 = 27 metres
and Cell 3 = 11 metres.
|
Data Aggregation Methods |
- Raw drillhole samples were
composited to 2 metre intervals for use in mineral resource
estimation.
|
Relationship Between Mineralization Widths and Intercept
Points |
- Downhole width is equivalent to true
width.
|
Diagrams |
- Diagrams, maps and cross-sections
are included in the press release for reference.
|
Balanced Reporting |
- All of the tailing material which
has been assayed has reported elevated concentration of
manganese
- 2018 Sample assay grades range from
0.19% to 11.69% total Manganese (by XRF analysis), with mean value
of 7.29%.
|
Other Substantive Exploration Data |
- A total of 6.6 km lines of
high-resolution electric resistivity tomography (ERT) and seismic
refraction was conducted by Glmpuls Praha spol. s.r.o., on behalf
of Mangan Chvaletice, in 2017.
|
Further Work |
- No further exploration work is
recommended or planned.
|
SECTION 3 Estimation
and Reporting of Mineral Resources
Criteria |
Explanation |
Database Integrity |
- Tetra Tech undertook verification of
the data transfer and compilation process at SGS through visual
comparison of the issued certificates of analysis with the digital
assay records.
- The drillhole database was visually
inspected by Tetra Tech, and corrections made prior to further
inspection using digital validation tools within Leapfrog Geo
modelling software.
|
Site Visits |
- A site visit was conducted by Tetra
Tech CP, James Barr, P.Geo., from July 1 to 3, 2017, and July
30-31, 2018, during both drilling campaigns, and a site visit was
conducted by Mr. Jianhui Huang, Ph.D., P.Eng on February 5,
2018.
|
Geological Interpretation |
- A mineral resource estimate has been
developed for total and soluble manganese concentrations.
- Total manganese is based on XRF
analysis, and soluble manganese is based on results of aqua regia
digestion and ICP-MS or AAS analysis.
- Additionally, average moisture and
grain size distribution indicators are reported for the
deposit.
- Geological interpretation assumes
that deposition of tailings materials was episodic over the life of
the historical mining operations, and the material was deposited
from processed materials with mixed particle sizes suspended in
slurry with thin lateral continuity with a particle gradation from
coarse to fine away from the point of discharge.
|
Dimensions |
- Total surface area is approximately
1,032,800 m², approximate total volume (tailings)
17,528,800 m³, approximate total volume of topsoil is
2,060,030 m³.
- The resource is reported using a
sub-block model with parent blocks 50x50x4 metres and
sub-blocks 12.5x12.5x2 metres.
|
Estimation and Modelling Techniques |
- The Mineral Resource Estimate was
calculated using Aranz Leapfrog Geo v.4.4.2.
- Interpolation searches were
150x150x8 metres and were performed using an inverse distance (to
the exponent 3) methodology. Data distribution did not conform to
reliable variography assessment.
- The search was limited to a maximum
of two samples per drill hole and required a minimum of two to a
maximum of six samples in order to populate a block.
|
Moisture |
- The tonnage is reported on an in
situ dry material basis.
- Moisture loss was measured during
sample handling and preparation.
|
Cut-off Parameters |
- A break-even grade of 2.18% total Mn
has been estimated for the Chvaletice deposit. The estimated
break-even cut-off grade falls below the grade of most of the
blocks (excluding 5,000 tonnes which have grades less than 2.18%
total Mn, these have not been deducted from the Mineral Resource
Statement). It is assumed that material segregation will not be
possible during mining due to inherent difficulty of grade control
and selective mining for this deposit type.
|
Mining Factors or Assumptions |
- The deposit sits above ground and is
candidate for traditional truck and shovel mining, or other
possible surface extraction techniques following dewatering of
tailings.
- It is assumed that material
segregation will not be possible due to inherent difficulty of
grade control and selective mining for this deposit type.
|
Metallurgical Factors or Assumptions |
- Preliminary assumptions include
pre-concentration operating costs of US$6.47/t feed, leaching and
refining operating cost estimates of US$188/t feed, total recovery
to HPEMM and HPMSM of approximately 60.5% and 58.9%, respectively,
and metal prices of 9.60 kg/t for HPEMM and 3.72 kg/t for HPMSM
(marketing study report prepared by CPM Group LLC, June 2022). The
actual commodity price for these products may vary.
|
Environmental Factors or Assumptions |
- The area covered by the Chvaletice
tailings has been significantly impacted by past mining and other
heavy industrial activities.
- Environmental baseline studies have
been in progress since the summer of 2016. These include
hydrological sampling and monitoring, as well fauna and flora
surveys.
|
Bulk Density |
- In situ dry bulk density is basis
for tonnage estimate and was calculated from estimated core
recovery along with laboratory measurements for mass and
moisture.
- Bulk density was a variable modelled
into the block model based on the calculated in situ dry bulk
density for each sample.
- Calculated in situ dry bulk density
values for individual samples range between 0.35 t/m3 and 3.15
t/m3, with a mean value of 1.55 t/m3.
|
Classification |
- Classification is based on the JORC
Code and divides the mineral resource into Measured and Indicated
categories.
- A variance analysis on the block
model determined that blocks supported from five or more samples,
within an average distance of 100 m and with the closest sample
within 75 metres be classified as Measured Resources, and blocks
with greater than three samples within average distance of 150
metres be classified as Indicated Resources.
- No blocks were classified as
Inferred Resources.
|
Audits and Reviews |
- No external audits were
performed.
- Internal peer and senior review
audits were performed as part of Tetra Tech’s quality management
system.
|
Discussion of Relative Accuracy/Confidence |
- The mineral resource estimate is
reported as a weighted average grade and tonnage based on the
search methodology and is not reported within error or confidence
limits.
- Indicated resources are considered
lower confidence with higher margin of error than Measured
resources.
- The modelling was validated using
visual comparison, declustered mean comparison, and swath plots and
is considered to be representative of the input data.
- Reconciliation to the 2017 block
model was completed to identify areas with significant changes may
have occurred.
- Bulk density relies on estimated
recovery from the field which may introduce some error into the
calculation.
- Assumption of lateral
continuity/gradation of particle size may introduce error.
|
SECTION 4 Estimation
and Reporting of Mineral Reserves
Criteria |
Explanation |
Mineral Resource estimate for conversion to Ore
Reserves |
- The Mineral Resource Estimate
described in Section 3 has been used to determine Ore
Reserves.
- The Mineral Resource Estimate is
reported inclusive of Ore Reserves.
|
Site visits |
- A site visit was conducted by Tetra
Tech Qualified Persons, Maurie Marks, P.Eng., Chris Johns, P.Eng.,
Hassan Ghaffari, P.Eng., and Jianhui Huang, Ph.D., P.Eng. on May
3rd,2022 and Jianhui Huang, Ph.D., P.Eng on February 5, 2018.. The
three tailings cells were visited as well as proposed
infrastructure locations. Jianhui Huang, Ph.D., P.Eng also visited
the Changsha Research Institute of Mining and Metallurgy Co. Ltd.
(CRIMM) laboratory and pilot plant facility five times between
January 20, 2017 and September 20, 2018 to witness sample
preparation and test/assay facilities and to discuss test program
and results with CRIMM’s technical team. Mr. Huang visited Beijing
General Research Institute for Mining and Metallurgy (BGRIMM) four
times during September 03 2019 to January 25 2020 to witness
test/assay facilities and to discuss test program and results with
BGRIMM’s technical team. Mr. Huang also visited the SGS Minerals
Services (SGS) laboratory on June 29, 2017 and Slon Magnetic
Separator Ltd. On December 27 2019 to witness the metallurgical
testing.
|
Study status |
- Preliminary Economic Assessment work
completed in 2019 was used as the basis to advance the project for
completion of the current Feasibility Study.
- As part of the Feasibility Study, an
economically viable mine plan has been developed that includes
material modifying factors.
|
Cut-off parameters |
- To convert the
Mineral Resource to an Ore Reserve, a break-even grade of 2.18%
total Mn has been estimated for the resource estimate of the
Chvaletice deposit.
- The estimated break-even grade falls
below the grade of most of the blocks (excluding 5,000 tonnes which
have grades less than 2.18% total Mn). Material segregation will
not be possible during mining due to inherent difficulty of grade
control and selective mining for this deposit type.
- Calculation of the cut-off
parameters was undertaken using a Net Smelter Return (NSR) formula,
including the following modifying factors; mined grade, contained
metal, recovery rates for HPEMM and HPMSM, mining operating cost,
processing cost, (including EMM to MSM conversion cost), residue
placement cost, general and administrative costs, site service
costs, water treatment, shipping cost, product insurance, and
royalties.
- These parameters were applied to
each block in the block model to determine the value.
|
Mining factors or assumptions |
- The tailings cells are designed to
be mined by excavator, loading haul trucks on 3m high benches with
a 12m bench width and face angle of 45°.
- Geotechnical considerations were
focused on bench stability and the ability to operate equipment on
the benches of the tailings cells. Depressurization of the water
contained within the cells is expected to occur during the cut of
the first bench and continue with each subsequent advance.
- Mining extents used for reserve
estimation extend horizontally to the limits of all three cells,
and is controlled vertically by original ground, with a
shallow-graded floor. This floor is designed to maximise reserve
extraction whilst allowing the installation of drainage
infrastructure and placement of residue immediately following
mining.
- Pre-stripping of the topsoil will be
completed one year in advance of mining on an annual basis, with
material stockpiled on top of each respective cell for replacement
as cover material on the residue storage facility during years 2-25
of the life of mine. Blasting of the material is not required.
- Minimal dilution and losses of
<1% are expected to occur at the interface between the lower
bounds of the tailings cells and original ground as the surface is
uneven. The entirety of material to be mined is considered ore and
will be processed. In turn, the entire orebody delineated in
reserves is expected to be recovered.
- Mining infrastructure designed as
part of the Feasibility Study includes truck maintenance workshop
and warehouse, refuel areas, equipment laydown area and admin
building. A central haul road is also designed for access to each
of the tailings cells throughout the life of mine.
- Inferred resources have not been
included within the Feasibility Study.
|
Metallurgical factors or assumptions |
- Several metallurgical test programs
have been completed, including three semi-continuous pilot plant
runs and large scale batch testing based on preliminary optimized
process/test conditions.
- A total of 25 composite samples were
constructed from the drill core interval samples representing
different variation characters, including spatial location, grade
variation and particle size variations, and tested.
- Purification technologies were
tested.
- Se-free electrowinning processed has
been developed and confirmed for the mineral material.
- Cr-free passivation treatment for
the cathode plates has been tested and developed.
- The metallurgical recoveries were
estimated mainly from pilot plant test results that were used to
calibrate a mass balance model of the process circuits. The
estimated total manganese recoveries for process circuits are shown
below:
- Magnetic separation: 82.1 to 90.1%
tMn, averaging 86.1% tMn;
- Leaching recovery: 75% tMn
- Purification & Electrowinning:
93.6% tMn
- HPEMM to HPMSM: 97.4% tMn.
- The sample products produced from
the semi-continuous pilot plant tests and large scale batch tests
show that high purity electrolytic manganese metal (HPEMM) and high
purity manganese sulfate monohydrate (HPMSM) can be produced from
the tailings material that exceed typical industry standards.
- Further the comprehensive
metallurgical test work completed by CRIMM, BGRIMM conducted
various verification tests, including magnetic separation,
concentrate leaching and solution purification, EMM dissolution and
solution purification, crystallization, magnetic tailings and leach
residue dewatering. The metallurgical test work also conducted
equipment type selection and verification tests by potential
suppliers and verify suitability for some of the reagents produced
by local European suppliers.
- Mill feed and leach residue material
handling tests were conducted by Jenike & Johanson Ltd. to
determine.
- Head sample, non-magnetic tailings
and leach residue samples were submitted to accredited laboratories
in both Canada and Czech Republic for determining their chemical
and physical properties.
- Ultra-high purity assay methods for
the HPEMM and HPMSM were investigated. Preliminary product
specifications were developed.
|
Environmental |
- Several environmental studies have
been conducted, including environmental baseline studies which
include ecosystem mapping, documentation of the physical and
environmental characteristics of the Chvaletice Manganese Project
site and an assessment of land use plans of the adjoining
municipalities. Significant local features were recorded, including
sensitive and protected areas, vegetation, landscape elements, and
areas or sites of historical, cultural, archaeological or
geological importance. Climate, air, water, soil, natural
resources, fauna, flora and ecosystems, landscape and population of
the area were preliminarily inventoried. The baseline studies
provide an overall assessment of the environment conditions that
prevail in the Project area of interest.
|
Infrastructure |
- The existing infrastructure
immediately adjacent to the proposed project site includes an 800
MW coal-fired power station operated by Severní Energetická a.s.
and a pre-cast concrete plant operated by Eurobeton.
- The Property is located along paved
Highway #322 which connects to Prague, approximately 89 km by road,
via Kolin and Highway #12. The proposed process plant and
management office are located immediately south of the highway. A
rail line is located between the highway and the Chvaletice
Manganese Project tailings facility, immediately to the south of
the Chvaletice tailings property, which acts as main transportation
line from Prague to communities of Eastern Czech Republic. Spur
lines at the south of the highway are used to transport and unload
coal to the 800 MW power station, and to service an adjacent
industrial park which is the site of the former processing
facilities that produced the Chvaletice tailings.
- New and refurbished infrastructures
that will be built to service the Project include:
- south site: one non-magnetic
tailings (NMT) and washed leach residue (LR) storage facility, one
extracted existing tailings pulping, various service facilities,
such as truck shop, office, fuel station and parking lots;
- south-north site connection overhead
bridge housing one slurry pipeline and NMT/LR transport conveyor
and various utility pipelines and power cables;
- south site: various process
facilities, maintenance workshop and spare part storage facilities,
railway spurs and loading/unloading facilities, reagent storage
facilities, laboratories, general office and service complex, power
supply, water supply, steam supply and air supply.
|
Costs |
- Capital costs were estimated based
on the FS level engineering designs completed by Tetra Tech, BGRIMM
and Sudop Praha a.s, with inputs contributed from Tractebel
Engineering a.s and Mangan/EMN. The capital costs include direct
costs (equipment, buildings, equipment installation, access and
inner roads, railway spur upgrading and others). Indirect costs
(shipping, construction indirect, EPCM, spare parts and initial
fills), owner costs and contingency (approximately 15.6% of direct
costs). The total initial capital cost was estimated to be US$757
million.
- Major equipment prices were based on
quotations.
- Capital costs related to process
facilities and other facilities were estimated based on workshop
and building layouts prepared according to engineering
designs.
- Equipment transport costs for
capital cost estimates were based on percentage of equipment costs,
including land and ocean transport costs, port handling costs and
custom fees if applicable.
- Operating costs were estimated based
on operation functions, including tailings extraction, process,
lined NMT/LR dry stacking storage, G&A and site services. The
categories included in the operation cost estimates include
manpower requirement, various consumables (reagents and other
consumables), electricity power consumption, steam consumption, hot
water consumption, maintenance spare parts, office and general
management related costs, including safety and training costs. The
average life of project operating cost was estimated to be
US$194.79/t mill feed.
- Operating consumable costs and
related shipping costs were mainly based on the marketing study
prepared by logistic team at Mangan.
- The foreign exchange rates used in
cost estimates and economic model were based on current rates and
average exchange rates of the last three years, up to 31st May
2022.
- A market study for high purity
electrolytic manganese metals and high purity manganese sulfate
monohydrate was conducted by CPM Group LLC (June 2022).
- Government royalty was based on
2,308 Czech Koruna (CZK) per tonne of Mn produced.
|
Revenue factors |
- The products are assumed to be
distributed worldwide, mainly in European countries. Preliminary
transport costs for the products were estimated based on potential
consumer locations and tonnages. The consumable costs and related
shipping costs were mainly based on the marketing study prepared by
logistic team at Mangan.
- Plant feed grades were based on
year-by-year mine plan which was developed from ore reserve
estimate. Grades throughout the life of mine plan are relatively
consistent at an average of 7.4% Mn.
- The foreign exchange rates used in
costs estimates and economic model were based on current rates and
average exchange rates of the last three years up to 31st May
2022.
- The sale and distribution costs were
included in the economic analysis.
- Tetra Tech relied on the market
study conducted by CPM Group LLC as the basis for the pricing of
the Ore Reserves.
|
Market assessment |
- A market study for high purity
electrolytic manganese metals and high purity manganese sulfate
monohydrate was conducted by CPM Group LLC.
- The study includes the market demand
and supply for high purity manganese products. High purity
electrolytic manganese metal (HPEMM) and high purity manganese
sulfate monohydrate (HPMSM) products are mostly used in the
manufacture of lithium-ion batteries for electric vehicles (EVs)
and energy storage systems (ESS) – the market is expected to
experience significant growth over the next two decades. HPEMM is
also used in a variety of steel, aluminum and other super
alloys.
- The report analyzes consumption
trends and potential factors that may affect their supply and
demand over the life of the project. The report also analyzes
supply market, indicating potential competitors appear to mainly be
from China and South Africa. The main demand will be rapidly
growing battery industry for electric vehicles and energy storage
systems.
- The study shows that the prices of
the HPMSM are likely to rise more steeply initially due to massive
increase in demand from the battery industry. The price of
conventional EMM will continue to be driven by the aluminum and
steel alloy industry and the level of economic activity in these
sectors, but the battery industry will have growing influence on
the general price levels of electrolytic manganese metal and the
high-purity premiums are likely to raise in the next decade.
- The test results show that the
products produced from the semi-continuous pilot plant and
large-scale batch testing would meet the specifications required by
potential customers.
|
Economic |
- All the capital costs, operating
costs, product packing, shipping, sales as well as revenue streams
were included in the financial model.
- The base NPV calculations were based
on a discount rate of 8%. The post-tax NPV at a discount rate of 8%
was US$1,342 M with a 21.9% IRR and 4.13 years payback period.
- Project sensitivity was analyzed to
compare the key variables of discount rate, product price, capital
cost, operating cost and metal recovery on pre-tax and post-tax
NPV. The project is relatively less sensitive to capital costs
compared to operating cost and product price.
|
Social |
- EMN has initiated the social impact
studies, including collection of land-use and socio-economic
data,
- EMN has initiated pro-active and
regular consultation with community stakeholders, which are
expected to intensify as the Chvaletice Manganese Project
evaluation and planning advances. In November 2017, The Company’s
subsidiary, Mangan Chvaletice s.r.o. (“Mangan”), inaugurated a
Project Information Center in the Town of Chvaletice’s Municipal
Culture House, to provide residents with opportunities to learn
about the Project, help them to develop relationships with the
Company and its team, and to provide feedback and suggestions
during the Project evaluation and planning stage. In November of
2018, Mangan relocated its registered office to Chvaletice. This
move is intended as a first step towards ultimately basing its head
office in this municipality, in close proximity to its
operations.
- Community involvement and
consultation is an ongoing process.
- The Company is committed to, and has
commenced, the employment of local residents.
|
Other |
- No naturally occurring risks have
been identified that may impact the Ore Reserve.
- EMN has engaged with several
potential customers and been in negotiations around securing
contracts for the product.
- EMN is still working to secure the
surface rights for the project.
|
Classification |
- Ore reserves were classified based
on resource categories defined during resource estimation. Measured
ore resources were converted to Proven Reserves, and Indicated
resources were converted to Probable Reserves. No Measured
resources were included within Probable reserves. No Inferred
resources were included within the reserve classification.
|
Audits or reviews |
- There has been no external audits or
reviews of the Ore Reserves.
- Internal peer and senior review
audits were performed as part of Tetra Tech’s quality management
system.
- The process engineering design and
cost estimates by BGRIMM were overseen and reviewed by Tetra Tech
and EMN’s technical team.
- The comprehensive metallurgical test
work conducted by CRIMM in 2017 and 2018 and by BGRIMM and
potential suppliers between 2019 and 2020 were overseen and
reviewed by EMN’s technical team and Tetra Tech. Randomly selected
samples were assayed by independent assay laboratories. A
demonstration plant to further verify and process and generate
sample products for potential consumers is under installation. High
purity assay procedures have been tested.
|
Discussion of relative accuracy/confidence |
- The Ore Reserve estimate is reported
as a weighted average grade and tonnage based on the search
methodology and is not reported within error or confidence
limits.
- Probable reserves are considered
lower confidence with higher margin of error than Proven
Reserves.
- Appropriate modifying factors were
considered and applied as part of the conversion from Mineral
Resource to Ore Reserve.
- The 2017-2021 metallurgical test
programs by CRIMM, BGRIMM and other laboratories have widely
assessed the variability of the various plant mill feed samples,
including a total of 25 composite samples representing different
variation characters, covering spatial location, grade variation
and particle size variations. A demonstration plant has been
planned and under construction. The semi-continuous campaigns
should provide further data for future design work.
- The capital cost estimates were
estimated according to circuit design and preliminary layout. The
main equipment costs are from quotations from potential
suppliers.
- Operating costs were estimated by
various categories and on circuit and area basis. Most of
consumable prices were based on a supply marketing study conducted
by Mangan’s logistic team.
- Both operating cost and capital
costs are expected in line with Class 3, compared to FS level cost
estimates.
- Some of the potential product and
process technology risks are associated with the Project are:
- Market changes in high-purity
manganese products and their acceptance by customers
- Some metallurgical responses and
product assays should be confirmed. More metallurgical test work is
required to verify key operating conditions, especially impurity
controls.
- Scale up and control of
crystallization and purification processes.
- Changes in supply costs.
|
APPENDIX 2Chvaletice
Manganese Project Production and Cash Flows (by year)
|
|
Total / Average |
Year -4 |
Year -3 |
Year -2 |
Year -1 |
Year 1 |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
Year 6 |
Year 7 |
Year 8 |
Year 9 |
Year 10 |
Year 11 |
|
|
2023 |
|
2024 |
|
2025 |
|
2026 |
|
2027 |
|
2028 |
|
2029 |
|
2030 |
|
2031 |
|
2032 |
|
2033 |
|
2034 |
|
2035 |
|
2036 |
|
2037 |
|
Ore Processed |
k tonnes |
26,644 |
|
- |
|
- |
|
- |
|
- |
|
718 |
|
1,113 |
|
1,107 |
|
1,070 |
|
1,012 |
|
1,040 |
|
1,080 |
|
1,097 |
|
1,016 |
|
1,010 |
|
1,016 |
|
Mn Grade |
% |
7.41 |
% |
- |
|
- |
|
- |
|
- |
|
7.98 |
% |
7.41 |
% |
7.44 |
% |
7.63 |
% |
7.96 |
% |
7.81 |
% |
7.61 |
% |
7.43 |
% |
7.96 |
% |
7.97 |
% |
7.89 |
% |
Contained Mn |
k tonnes |
1,973.5 |
|
- |
|
- |
|
- |
|
- |
|
57.3 |
|
82.5 |
|
82.4 |
|
81.7 |
|
80.5 |
|
81.2 |
|
82.2 |
|
81.5 |
|
80.9 |
|
80.5 |
|
80.1 |
|
Overall total Mn Recovery |
% |
59.4 |
% |
- |
|
- |
|
- |
|
- |
|
55.0 |
% |
59.6 |
% |
59.6 |
% |
60.2 |
% |
61.0 |
% |
60.6 |
% |
60.1 |
% |
59.6 |
% |
61.1 |
% |
61.1 |
% |
60.8 |
% |
HPEMM Produced, 99.9% Mn |
k tonnes |
1,194.5 |
|
- |
|
- |
|
- |
|
- |
|
32.1 |
|
50.1 |
|
50.1 |
|
50.1 |
|
50.1 |
|
50.2 |
|
50.3 |
|
49.5 |
|
50.3 |
|
50.1 |
|
49.7 |
|
HPEMM Converted to HPMSM |
k tonnes |
822.3 |
|
- |
|
- |
|
- |
|
- |
|
21.7 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
HPMSM Produced/sold, 32.34% Mn |
k tonnes |
2,465.0 |
|
- |
|
- |
|
- |
|
- |
|
65.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
HPEMM Produced/sold, 99.9% Mn |
k tonnes |
372.3 |
|
- |
|
- |
|
- |
|
- |
|
10.4 |
|
16.7 |
|
16.7 |
|
16.7 |
|
16.7 |
|
16.8 |
|
17.0 |
|
16.1 |
|
17.0 |
|
16.7 |
|
16.3 |
|
HPMSM Price |
US$/t |
4,019 |
|
- |
|
- |
|
- |
|
- |
|
3,266 |
|
3,542 |
|
3,810 |
|
3,873 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
HPEMM Price |
US$/t |
10,545 |
|
- |
|
- |
|
- |
|
- |
|
8,197 |
|
9,058 |
|
9,893 |
|
10,091 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
HPMSM Revenues |
US$M |
9,931 |
|
- |
|
- |
|
- |
|
- |
|
212 |
|
354 |
|
381 |
|
387 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
HPEMM Revenues |
US$M |
3,931 |
|
- |
|
- |
|
- |
|
- |
|
85 |
|
151 |
|
165 |
|
169 |
|
180 |
|
181 |
|
183 |
|
174 |
|
183 |
|
180 |
|
176 |
|
Freight, Insurance & Selling |
US$M |
(406 |
) |
- |
|
- |
|
- |
|
- |
|
(10 |
) |
(16 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
(17 |
) |
Government Royalty |
US$M |
(121 |
) |
- |
|
- |
|
- |
|
- |
|
(3 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
Net Revenues |
US$M |
13,336 |
|
- |
|
- |
|
- |
|
- |
|
284 |
|
484 |
|
525 |
|
534 |
|
568 |
|
569 |
|
571 |
|
562 |
|
570 |
|
568 |
|
564 |
|
Opex |
US$M |
(5,190 |
) |
- |
|
- |
|
- |
|
- |
|
(161 |
) |
(215 |
) |
(215 |
) |
(214 |
) |
(213 |
) |
(214 |
) |
(215 |
) |
(213 |
) |
(213 |
) |
(212 |
) |
(211 |
) |
Capital - Initial |
US$M |
(757 |
) |
(114 |
) |
(189 |
) |
(189 |
) |
(265 |
) |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
Capital - Sustaining |
US$M |
(117 |
) |
- |
|
- |
|
- |
|
- |
|
(4 |
) |
(5 |
) |
(3 |
) |
(3 |
) |
(11 |
) |
(3 |
) |
(3 |
) |
(3 |
) |
(3 |
) |
(11 |
) |
(3 |
) |
Working Capital |
US$M |
- |
|
- |
|
- |
|
- |
|
- |
|
(79 |
) |
(45 |
) |
(7 |
) |
(1 |
) |
(5 |
) |
- |
|
(1 |
) |
2 |
|
(2 |
) |
1 |
|
1 |
|
Process Plant Salvage Value |
US$M |
38 |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
Taxes |
US$M |
(1,397 |
) |
- |
|
- |
|
- |
|
- |
|
(14 |
) |
(40 |
) |
(48 |
) |
(50 |
) |
(57 |
) |
(57 |
) |
(57 |
) |
(56 |
) |
(57 |
) |
(57 |
) |
(64 |
) |
Unlevered Free Cash Flow |
US$M |
5,912 |
|
(114 |
) |
(189 |
) |
(189 |
) |
(265 |
) |
26 |
|
178 |
|
251 |
|
266 |
|
282 |
|
295 |
|
295 |
|
292 |
|
295 |
|
289 |
|
286 |
|
EBITDA |
US$M |
8,146 |
|
- |
|
- |
|
- |
|
- |
|
123 |
|
269 |
|
309 |
|
320 |
|
355 |
|
355 |
|
355 |
|
348 |
|
357 |
|
355 |
|
352 |
|
EBITDA Margin on Net Sales |
% |
58.8 |
% |
- |
|
- |
|
- |
|
- |
|
41.4 |
% |
53.2 |
% |
56.6 |
% |
57.5 |
% |
60.2 |
% |
60.1 |
% |
60.0 |
% |
59.7 |
% |
60.3 |
% |
60.2 |
% |
60.2 |
% |
Note 1. Numbers may not add exactly due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year 12 |
Year 13 |
Year 14 |
Year 15 |
Year 16 |
Year 17 |
Year 18 |
Year 19 |
Year 20 |
Year 21 |
Year 22 |
Year 23 |
Year 24 |
Year 25 |
Year 26 |
|
|
2038 |
|
2039 |
|
2040 |
|
2041 |
|
2042 |
|
2043 |
|
2044 |
|
2045 |
|
2046 |
|
2047 |
|
2048 |
|
2049 |
|
2050 |
|
2051 |
|
2052 |
Ore Processed |
k tonnes |
1,017 |
|
907 |
|
834 |
|
1,056 |
|
1,085 |
|
1,130 |
|
1,168 |
|
1,237 |
|
1,196 |
|
1,184 |
|
1,236 |
|
1,183 |
|
1,137 |
|
997 |
|
- |
Mn Grade |
% |
7.91 |
% |
8.17 |
% |
8.72 |
% |
7.40 |
% |
7.24 |
% |
7.04 |
% |
6.84 |
% |
6.60 |
% |
6.75 |
% |
6.80 |
% |
6.58 |
% |
6.81 |
% |
6.92 |
% |
7.64 |
% |
- |
Contained Mn |
k tonnes |
80.4 |
|
74.1 |
|
72.7 |
|
78.1 |
|
78.5 |
|
79.6 |
|
79.9 |
|
81.6 |
|
80.7 |
|
80.5 |
|
81.3 |
|
80.6 |
|
78.7 |
|
76.1 |
|
- |
Overall Mn total Recovery |
% |
60.9 |
% |
61.5 |
% |
62.9 |
% |
59.4 |
% |
59.0 |
% |
58.4 |
% |
57.8 |
% |
57.1 |
% |
57.5 |
% |
57.7 |
% |
57.0 |
% |
57.7 |
% |
58.0 |
% |
60.1 |
% |
- |
HPEMM Produced, 99.9% Mn |
k tonnes |
49.9 |
|
46.5 |
|
46.6 |
|
47.3 |
|
47.3 |
|
47.4 |
|
47.1 |
|
47.5 |
|
47.4 |
|
47.3 |
|
47.3 |
|
47.4 |
|
46.6 |
|
46.7 |
|
- |
HPEMM Converted to HPMSM |
k tonnes |
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
33.4 |
|
- |
HPMSM Produced/sold, 32.34% Mn |
k tonnes |
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
100.0 |
|
- |
HPEMM Produced/sold, 99.9% Mn |
k tonnes |
16.5 |
|
13.1 |
|
13.2 |
|
14.0 |
|
13.9 |
|
14.1 |
|
13.7 |
|
14.1 |
|
14.0 |
|
14.0 |
|
13.9 |
|
14.1 |
|
13.2 |
|
13.3 |
|
- |
HPMSM Price |
US$/t |
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
4,094 |
|
- |
HPEMM Price |
US$/t |
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
10,780 |
|
- |
HPMSM Revenues |
US$M |
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
409 |
|
- |
HPEMM Revenues |
US$M |
178 |
|
142 |
|
143 |
|
151 |
|
150 |
|
152 |
|
148 |
|
152 |
|
151 |
|
151 |
|
150 |
|
152 |
|
143 |
|
143 |
|
- |
Freight, Insurance & Selling |
US$M |
(17 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
(16 |
) |
- |
Government Royalty |
US$M |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
(5 |
) |
- |
Net Revenues |
US$M |
566 |
|
530 |
|
531 |
|
539 |
|
538 |
|
540 |
|
536 |
|
540 |
|
539 |
|
539 |
|
538 |
|
540 |
|
531 |
|
532 |
|
- |
Opex |
US$M |
(212 |
) |
(200 |
) |
(198 |
) |
(205 |
) |
(206 |
) |
(208 |
) |
(208 |
) |
(210 |
) |
(209 |
) |
(209 |
) |
(210 |
) |
(209 |
) |
(206 |
) |
(202 |
) |
- |
Capital - Initial |
US$M |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
Capital - Sustaining |
US$M |
(3 |
) |
(3 |
) |
(3 |
) |
(11 |
) |
(3 |
) |
(3 |
) |
(3 |
) |
(3 |
) |
(11 |
) |
(3 |
) |
(4 |
) |
(4 |
) |
(4 |
) |
(7 |
) |
- |
Working Capital |
US$M |
- |
|
8 |
|
- |
|
(3 |
) |
- |
|
(1 |
) |
1 |
|
(1 |
) |
- |
|
- |
|
- |
|
- |
|
2 |
|
130 |
|
- |
Process Plant Salvage Value |
US$M |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
38 |
Taxes |
US$M |
(64 |
) |
(60 |
) |
(60 |
) |
(60 |
) |
(60 |
) |
(60 |
) |
(59 |
) |
(59 |
) |
(59 |
) |
(60 |
) |
(60 |
) |
(60 |
) |
(59 |
) |
(60 |
) |
- |
Unlevered Free Cash Flow |
US$M |
287 |
|
276 |
|
270 |
|
260 |
|
269 |
|
268 |
|
267 |
|
266 |
|
260 |
|
266 |
|
265 |
|
267 |
|
264 |
|
392 |
|
38 |
EBITDA |
US$M |
354 |
|
331 |
|
334 |
|
334 |
|
332 |
|
332 |
|
329 |
|
330 |
|
330 |
|
330 |
|
328 |
|
331 |
|
325 |
|
330 |
|
- |
EBITDA Margin on Net Sales |
% |
60.2 |
% |
60.0 |
% |
60.4 |
% |
59.6 |
% |
59.4 |
% |
59.2 |
% |
59.0 |
% |
58.7 |
% |
58.9 |
% |
58.9 |
% |
58.7 |
% |
59.0 |
% |
59.0 |
% |
59.6 |
% |
- |
Note 1. Numbers may not add exactly due to rounding. |
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A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/4c4bb671-50d1-4595-b52e-dbfe688d083a
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