Euro Manganese Inc. (TSX-V and ASX: EMN; OTCQX: EUMNF; Frankfurt:
E06) (the "Company" or "EMN") is pleased to announce key
developments on its Bécancour Plant, which provide an opportunity
to accelerate the Company’s plans to produce high-purity manganese
products in Canada for the North American electric vehicle ("EV")
market.
Highlights
-
A Scoping Study was completed evaluating the development of a
Dissolution Plant in Bécancour, Québec capable of producing 48,500
tonnes per annum ("tpa") of battery grade manganese sulphate
("HPMSM"). The Scoping Study delivered strong preliminary project
economics with a post-tax Net Present Value ("NPV") of C$190
million and a post-tax Internal Rate of Return ("IRR") of 26%.
-
The Company has selected WSP Canada Inc. to complete a Feasibility
Study for the Plant, which will further refine Plant design, costs,
economics, and customer off-take opportunities.
-
In addition, the Company has signed a Memorandum of Understanding
("MoU") with MMC, a South African producer of high-purity
electrolytic manganese metal ("HPEMM"), to supply the Bécancour
Dissolution Plant with battery-grade, selenium-free, 99.9% HPEMM
feedstock. HPEMM is an already refined metal product that requires
further processing to produce battery grade manganese
sulphate.
-
The MoU is strategically significant for the Company as it enables
the potential acceleration of the Plant to supply the North
American market, possibly as early as mid-2026, thus bringing
forward cash flows for the Company.
-
The Company has signed a Cooperation Agreement with the Grand
Conseil de la Nation Waban-Aki (the "W8banaki") a tribal council of
the Abenaki communities, on whose ancestral territory the Bécancour
Project would be situated.
-
Bécancour is fast becoming a leading battery materials hub within
Canada and the Company’s site is strategically located adjacent to
a cluster of planned cathode active material manufacturing
plants.
-
The Bécancour Plant could produce up to 20% of projected North
American 2027 demand for HPMSM. CPM Group forecasts demand for
North American HPMSM to rise to approximately 250,000 tpa in 2027
and over 800,000 tpa by 2031. American EV tax credits from the
Inflation Reduction Act have stimulated growth of the North
American EV vehicle market and the upstream supply chain. However,
there remains no current processing capacity or production of
battery-grade manganese in North America.
Bécancour Scoping Study
Ausenco Vancouver completed a positive
Scoping Study which evaluated the development of a
high-purity manganese metal Dissolution Plant in Bécancour, Québec
capable of producing 48,500 tpa of HPMSM based on
sufficient supply of HPEMM feedstock. The Plant site is a
15-hectare land parcel within the Bécancour industrial park on
which the Company has an option agreement to purchase. The Company
has also completed site due diligence.
The Scoping Study delivered strong
preliminary project economics with a post-tax NPV of C$190
million using an 8% discount rate, a post-tax IRR of 26%, and a
payback period of approximately 4 years. The economic analysis was
run on a constant dollar basis with no inflation, no government
grants, and was unlevered.
Initial capital was estimated
at C$110.8 million, including contingencies of C$15.1 million. A
key aspect of the Plant is a short build time; the
Study estimated an approximate 2-year
engineering/construction duration.
The Plant design allows for production of both
high-purity manganese sulphate monohydrate crystals ("HPMSM") and
high-purity manganese sulphate solution ("HPMSS"), which
provides customer offtake flexibility. The Plant
design leverages extensive process development and engineering work
already completed for the Company’s Chvaletice Manganese Project
("CMP") in the Czech Republic.
Producing HPMSS provides both cost and
environmental benefits. An HPMSS product could be pumped
as a solution to nearby precursor cathode active materials ("pCAM")
manufacturers, which eliminates the need to crystallize, dry and
package an HPMSM product. As HPMSM is ultimately dissolved in water
by pCAM plants, delivering a solution saves costs and reduces water
consumption and CO2 emissions.
Minimal infrastructure improvements are
required to build the Plant. Offsite infrastructure is
limited to a powerline connection from the main Bécancour power
distribution network and the potential construction of a railway
spur from the Bécancour site railway line. Onsite infrastructure
includes roads, plant and administrative buildings, power
distribution and storage buildings for HPEMM feedstock and
HPMSS/HPMSM products.
Feedstock optionality via a third-party
metal supply was modeled, which may facilitate operation
of the Bécancour Plant as early as mid-2026, ahead of the CMP. This
would potentially enable the Company to be first to market in North
America and bring projected cash flows for the Company forward by
at least a year. This projected timeline and feedstock mix will be
assessed as key outputs of the Feasibility Study, which is expected
to be complete in mid-2024, subject to financing.
The Company has selected WSP Canada Inc. to
complete a Feasibility Study for the Plant, which
will further refine Plant design, costs, economics, and customer
off-take opportunities. Permitting is expected to advance in
parallel with the Feasibility Study.
Bécancour is fast becoming a leading
battery materials hub within Canada due to the excellent
regional infrastructure, the green and competitively priced energy,
a very supportive government with grant programs, and with a
qualified local work force. The Company’s site is strategically
located adjacent to a cluster of planned cathode active material
manufacturing plants, including GM/Posco and BASF.
Key Study Inputs &
Assumptions
A number of general assumptions were used in the
Scoping Study to assess the economics of constructing and operating
the Bécancour Dissolution Plant. As such, the outcomes and economic
metrics have a margin of error of -30%/+50%. Metal prices were
based on market analyst long-term forecasts. An exchange rate of
US$0.77 per C$1 was used. Forward escalation and contingencies for
scope changes and associated costs were not considered. Cost
estimates are based on Q4 2022 pricing without allowances for
inflation.
Euro Manganese cautions that the Study does not
constitute a scoping study within the definition used by the
Canadian Institute of Mining, Metallurgy and Petroleum ("CIM"), as
it relates to a standalone industrial project and does not concern
a mineral project of the Company. As a result, disclosure standards
prescribed by National Instrument 43-101 – Standards of Disclosure
for Mineral Projects ("NI-43-101") are not applicable to the
scientific and technical disclosure in the Study. Any references to
Scoping Study or Feasibility Study by Euro Manganese in relation to
the Bécancour Plant are not the same as terms defined by the CIM
Definition Standards and used in NI 43-101.
MoU with MMC
The Company has signed an MoU with MMC, a South
African producer of HPEMM, to supply the Bécancour Dissolution
Plant with battery-grade, selenium-free, 99.9% HPEMM feedstock.
The MoU provides feedstock optionality for the
Bécancour Plant, allowing it to be fed with HPEMM from MMC and/or
with HPEMM from the Company’s Chvaletice Manganese Project. The MoU
allows for flexibility on the supply of HPEMM depending on market
demand, MMC product availability, and CMP metal sales.
The MoU is strategically significant for the
Company as this third-party metal supply enables the potential
acceleration of the Plant to supply the North American market
possibly as early as mid-2026, thus potentially enabling the
Company to be first to market and to bring cash flows forward for
the Company.
MMC has provided HPEMM samples to the Company
for test work as part of the Bécancour Plant Feasibility Study and
both Parties intend to work together in good faith to conclude a
definitive agreement.
Cooperation Agreement with the
W8banaki
The Company has signed a Cooperation Agreement
(the "Agreement") with the Grand Conseil de la Nation Waban-Aki, a
tribal council consisting of the Abenaki communities of Odanak and
Wôlinak, on whose ancestral territory the Bécancour Project would
be situated.
The Agreement defines how the Company and the
W8banaki intend to communicate openly and regularly, and to work
together for the mutually acceptable development of the Bécancour
Project, especially during the evaluation and planning
phases.
Dr. Matthew James, President & CEO of Euro Manganese,
commented:
“Our growth plans to supply the North American
lithium-ion battery market with high-purity manganese are
advancing. Completion of the Bécancour Plant Scoping Study,
preparing for the Feasibility Study, and signing the MoU with MMC
lays the foundations to deliver significant additional value for
our stakeholders. The MoU provides us with feedstock flexibility
and enables us to potentially operate Bécancour as a stand-alone
project. More importantly, it outlines a potential pathway to bring
Company production and cash-flow forward by at least a year, in
advance of our Chvaletice Manganese Project in the Czech
Republic.
Equally, the Cooperation Agreement with the
W8banaki Nation demonstrates our commitment to working with our
partners from the beginning to develop the Bécancour Project in a
mutually beneficial way with the ancestral and local community. I
look forward to deepening this partnership as the Project
advances.
While our flagship Chvaletice Project remains at
the heart of our focus, the Bécancour Project advances our vision
of building a leading, multi-asset high-purity manganese business
to supply the rapidly growing EV market. We look forward to
partnering with MMC, the only current western provider of
high-purity manganese metal, to develop a strong strategic
relationship.”
Mr. Louis Nel, CEO of Manganese Metal Company,
commented:
“The energy transition primarily focuses on
critical materials and advanced technology. As the leading global
manufacturer of high-purity Electrolytic Manganese Metal (EMM), a
critical metal for battery production, MMC employs a unique process
technology that delivers 99.9% pure metal without needing selenium.
Therefore, MMC is an obvious choice to supply additional units for
the Bécancour Dissolution Plant.
MMC, the only supplier of high-purity EMM
outside of China, servicing a variety of industries, is eager to
expand its role in the battery market as the industry takes root
beyond Asia. We have substantial existing supply of
metal-for-dissolution into the ex-China production of precursor for
cathode active material (pCAM). With our long-recognised reputation
as a responsible producer, complete traceability, forward-thinking
ESG (Environmental, Social, and Governance) practices, and a
strategic location in South Africa - known for its vast manganese
deposits - MMC is perfectly poised to aid the development of a
sustainable North American battery and Electric Vehicle (EV)
ecosystem. In this case, our agreement with Euro Manganese
underlines our commitment.”
About Euro Manganese
Euro Manganese is a battery materials company
focused on becoming a leading producer of high-purity manganese for
the electric vehicle industry. The Company is advancing development
of the Chvaletice Manganese Project in the Czech Republic and
pursuing the opportunity to produce battery-grade manganese
products in Bécancour, Québec.
The Chvaletice Project is a unique
waste-to-value recycling and remediation opportunity involving
reprocessing old tailings from a decommissioned mine. It is also
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.
Euro Manganese is dual listed on the TSX.V and
the ASX, and is also traded on the OTCQX.
About Manganese Metal
Company
The Manganese Metal Company is a South African
producer and seller of manganese products and is the world’s only
non-China based producer of HPEMM. MMC operates the world’s largest
refinery of 99.9% pure, selenium-free HPEMM, uninterruptedly since
1974. The Company supplies various grades of EMM to a niche market
of over 120 established customers in 20 countries. Their systems,
equipment, safe operating philosophy, and excellent business
practices provide customers with peace of mind, first-class
quality, and reliable supply. MMC is 100% owned by Manganese Metals
Holdings (Pty) Ltd, a South African private investment company.
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, the Bécancour Plant,
its Chvaletice project 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.
These forward-looking statements include, but
are not limited to, statements concerning our plans for advancing
the Bécancour Plant. Results of the Scoping Study constitute
forward-looking information or statements, including but not
limited to, estimates of internal rates of return, net present
values, and estimates of costs. Such forward-looking information or
statements also include, but are not limited to, statements
regarding the timing for completion of the Feasibility Study on the
Bécancour Plant, the Company’s ability to exercise the option to
acquire the Bécancour land parcel, the Company’s ability to convert
the MoU with MMC into a definitive agreement, the Company’s
estimated engineering/construction timelines to build the Plant and
ability to arrange necessary infrastructure, the Company’s ability
to provide supplemental HPEMM feedstock to the Bécancour Plant from
the Chvaletice Project and source other feedstock, the technical
capability of the Bécancour Plant and the Company’s ability to
operate the Bécancour Plant and produce both HPMSS and HPMSM and
any associated cash flow and timelines for cash flow, the projected
growth of the North American demand for high-purity manganese
products, any benefits of proposed legislation, the economic and
environmental benefits of producing HPMSS, the Company’s ability to
secure offtake from North American customers, the Company’s ability
to raise the necessary financing for the Feasibility Study and for
the Bécancour Plant, and the timing of any permit application
submissions and approvals and continuing successful cooperation
with the W8banaki Nation.
Readers are cautioned not to place undue
reliance on forward-looking information or statements.
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: long term manganese prices assumed in Scoping
Study not providing accurate over time and negatively affecting
results, an inability to obtain financing, unanticipated
operational difficulties including failure of the Bécancour Plant,
failure of equipment or processes to operate in accordance with
specifications or expectations, cost escalation for reagents,
labour, power and other cost increases, inability to secure key
reagents, a delay or inability to obtain or maintain necessary
licenses or permits; the potential for unknown or unexpected events
to cause contractual conditions to not be satisfied; unexpected
results from the Feasibility Study; risks and uncertainties related
to limited feedstock supply options; changes in Bécancour Plant
parameters as plans continue to be refined; risks related to global
epidemics or pandemics and other health crises; 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; developments in EV
battery markets and chemistries; risks related to fluctuations in
currency exchange rates, changes in laws or regulations; and
regulation by various governmental agencies and changes or
deterioration in general economic conditions. 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, 2022, 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 ability of
the Company obtain any required environmental and other permits;
successful completion and positive outcome of the Feasibility
Study, currency exchange rates; high-purity manganese sales prices;
growth in the manganese market; and the availability of acceptable
financing. Statements regarding future production are based on
numerous assumptions regarding operating matters and on assumptions
that demand for products develops as anticipated, that customers
and other counterparties perform their contractual obligations,
that operating and capital plans will not be disrupted by issues
like lack of availability of personnel, machinery, equipment and
there are no material variations in costs.
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.
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