TIDMGUN
RNS Number : 5536P
Gunsynd PLC
21 June 2022
Gunsynd Plc
("Gunsynd" or the "Company")
Conditional Farm-in to Black Schist Projects in Finland
Nickel-Zinc-Copper-Cobalt Deposit Proximal to Large Talvivaara
Mine
Gunsynd (AIM: GUN; AQSE: GUN) is pleased to announce it has
agreed binding heads of terms with Metals One Plc ("Metals One") to
farm into the Black Schist Projects in Finland (the "Projects"),
containing a nickel-zinc-copper-cobalt deposit proximal, and
analogous, to the large Talvivaara mine.
Gunsynd has agreed to provide funding to Metals One of GBP1
million for the development of the Project (the "Investment"), for
which it will be issued such number of shares in the capital of
Finnaust Mining Northern OY ("Finnaust", which holds the Projects),
which equal 25% of the voting rights in Finnaust (the
"Farm-in").
The Investment is conditional upon Metals One's ordinary shares
being admitted to trading on the AIM market of the London Stock
Exchange ("Admission") and simultaneous acquisition of Finnaust.
Gunsynd will provide the GBP1 million funding and receive the 25%
of Finnaust over a period of 18 months in four equal tranches,
beginning on Metals One's Admission and thereafter at six-monthly
intervals, to be invested in the development of the Projects.
Black Schist Projects - Finland
The Projects are located in the Kainuu Schist Belt of eastern
Finland and contain existing inferred resources of 28.1 Mt
nickel-zinc-copper-cobalt (Ni-Zn-Cu-Co). The deposit is analogous
to the nearby Talvivaara Ni-Zn-Cu-Co deposit, one of the largest
nickel mines in Europe, which has a supply agreement with Renault
Group.
The Projects total 7km(2) and comprise three permit
applications:
-- Paltamo - contains a JORC exploration target of 16-24 Mt of
Talvivaara type ore containing 0.18-0.27% Ni, 0.09-0.13% Cu,
0.01-0.02% Co and 0.33-0.50% Zn has been estimated
-- Rautavaara S - contains a JORC (2012) inferred mineral
resource of 28.1 Mt of Talvivaara type ore at a grade of 0.19% Ni
(53,800t), 0.10% Cu (27,900t), 0.01% Co (3,400t) and 0.38% Zn
(180,000t)
-- Rauta 9-11 - application to extend the permit
Metals One believes there is a compelling case for further
exploration for Talvivaara-style Ni-Zn-Co-Cu deposits. Conditional
upon Admission, Metals One has scoped out an intensive 18-month
work programme targeting resource expansion, beginning in or around
Q3 2022, which will be part-funded by the Investment. The programme
will include geophysical and geochemical surveys to expand the
geological knowledge and confirm targets for approximately 9,000
metres of diamond drilling estimated to begin later this year.
The Projects benefit from historical geophysical, geological,
and geochemical data covering large areas of the belt as well as
historical geophysical surveys and diamond drilling.
Like the nearby Talvivaara mine, the Projects' northern European
location is exceptionally well suited to supplying battery metals
to Europe's electric vehicle and battery manufacturing plants which
are seeking to secure local supply chains and minimise the carbon
footprint of input materials.
In the six months ended 31 December 2021, Finnaust had turnover
of nil and made a profit for the period of GBP85.
Warrants and Board Representation
In addition to Gunsynd's 25 percent interest in Finnaust, the
Company will receive warrants to subscribe for ordinary shares in
Metals One valued at GBP75,000 at the Admission price of Metals
One's ordinary shares.
Following settlement of the first Farm-in instalment, Gunsynd
will have the right to appoint a director to the board of
Finnaust.
Hamish Harris, Chairman of Gunsynd, commented:
"The Black Schist Projects in Finland fit exceptionally well
within the mining segment of our investing strategy. The Projects
are underpinned by existing resources with significant exploration
upside potential, reside within a stable jurisdiction, are
well-supported by infrastructure, and are proximal, and analogous,
to the giant Talvivaara mine which was profitable in 2018 and 2019
when nickel prices were significantly lower than they are
today.
Battery metals are critical to decarbonisation and are facing
significant supply deficits. Europe is experiencing significant
growth in demand for electric vehicles and its manufacturers need
to secure reliable supply chains of battery metals such as nickel.
Their northern European location makes the Projects ideally located
to supplying battery metals into this market.
We believe we are investing in the Projects at a hugely
strategic and advantageous time, ahead of an intensive 18-month
exploration programme to which our investment will be applied, and
with market dynamics pointing to a continued upward trend in the
prices of battery metals. We have a track record of investing in
early stage nickel projects, with another of our investments -
Pacific Nickel Mines Limited - having earlier this month awarded an
offtake and project debt mandate to Glencore. We believe the Black
Schist Projects hold similarly exciting potential."
This announcement contains inside information for the purposes
of the UK Market Abuse Regulation.
Forward Looking Statements
This announcement contains forward-looking statements relating
to expected or anticipated future events and anticipated results
that are forward-looking in nature and, as a result, are subject to
certain risks and uncertainties, such as general economic, market
and business conditions, competition for qualified staff, the
regulatory process and actions, technical issues, new legislation,
uncertainties resulting from potential delays or changes in plans,
uncertainties resulting from working in a new political
jurisdiction, uncertainties regarding the results of exploration,
uncertainties regarding the timing and granting of prospecting
rights, uncertainties regarding the Company's ability to execute
and implement future plans, and the occurrence of unexpected
events. Actual results achieved may vary from the information
provided herein as a result of numerous known and unknown risks and
uncertainties and other factors.
The Directors of Gunsynd accept responsibility for this
announcement.
For further information please contact:
Gunsynd plc
Hamish Harris/ Peter
Ruse
www.gunsynd.com +44 (0)7879 584 153
Cairn Financial Advisers
LLP
James Caithie / Liam
Murray +44 (0)20 7213 0880
Peterhouse Capital Limited
Lucy Williams +44 (0)20 7469 0936
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END
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