ASX/AIM RELEASE
24
FEBRUARY 2025
MCB Project secures funding to
jumpstart development
HIGHLIGHTS
Makilala Mining Company, Inc. signed
a binding term sheet with Maharlika Investment Corporation, the
Philippines' sovereign wealth fund, for a bridge loan facility of
USD 76.4 million to initiate early works for the MCB
Project.
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Celsius Resources Limited
("Celsius" or "CLA") (ASX, AIM: CLA) is pleased to announce that its Philippine affiliate, Makilala
Mining Company, Inc. ("MMCI" or the "Company"), has signed a binding term
sheet with Maharlika Investment
Corporation ("MIC")
which outlines the key terms of a bridge loan facility of up to
USD 76.4 million
("Facility), to fund the Company's flagship
Maalinao-Caigutan-Biyog Copper-Gold
Project ("MCB" or
the "Project").
The Facility is intended to fully
finance the updating of the Company's feasibility study
("FS") and Front-End
Engineering Design ("FEED"), and partially funding early
development activities, including main access road construction in
coordination with the Kalinga Provincial Government and
skills-based training for the Balatoc community. The binding term
sheet is also intended to enable MMCI to comply with the financial
capability requirements under its Mineral
Production Sharing Agreement with the Philippine
Government.[1]
MIC
is a Philippine Government owned and controlled
corporation mandated to manage the sovereign wealth fund of the
Philippines. Its mission includes driving long-term national
development by fostering job creation, accelerating poverty
reduction, and promoting economic growth while achieving optimal
investment returns[2].
The MIC Board's approval follows an
extensive due diligence process, which assessed technical, legal,
financial, and socio-economic aspects of the Project. Initial
results highlight promising technical and economic feasibility,
environmental compliance, and social license.
The proceeds of the Facility mark a
critical milestone in the Project's funding, enabling immediate
commencement of work with the initial funding amount of USD10
Million. Consequently, these works will no longer require direct
funding from CLA.
Discussions on the additional equity
funding required are ongoing, given total estimated capital
expenditure of the Project. We look forward to updating investors
once binding equity agreements have been finalised.
MIC's Chief Executive Officer,
Rafael D. Consing, Jr. said:
"Our investment decision reflects a shared commitment to the
sustainable, inclusive, and regenerative development of the MCB
Project. We envision the MCB Project as a benchmark for the
Philippine Government's call for 'beyond responsible mining,'
setting a new standard for resource development in the
Philippines."
Celsius Executive Chairman Atty.
Julito R. Sarmiento, said:
"The Maharlika Investment Corporation's decision to invest in
the MCB Project underscores the Philippine Government's strong
commitment to advancing the critical metals sector and fostering a
responsible mining industry that delivers meaningful benefits to
host communities. In this case, we are particularly grateful for
the support extended to the Balatoc Indigenous Cultural Community,
which stands to gain from this partnership.
In
return, we pledge to fulfill our role as responsible stewards,
ensuring the MCB Project's success while upholding environmental
and social responsibilities. Immense credit goes to the dedicated
MMCI team in the Philippines, whose efforts, alongside the
unwavering support of the CLA Board, have brought the MCB Project
to this pivotal stage of construction and development. Achieving
full permitting and securing substantial funding within just four
years despite the challenges of the pandemic is a testament to
their hard work and commitment, and we express our heartfelt
gratitude to them for their achievements."
Principal Terms and
Conditions
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Facility Amount
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Up to USD76,435,418.90 covered by two
(2) Omnibus Loan and Security Agreements
(respectively, "First OLSA" and the "Second OLSA"; collectively, the
"OLSAs").
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Use
of Proceeds
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To fully finance
the updating of the Company's Feasibility Study and
FEED, partially finance the development and
operations of the MCB Project; and maintain
regulatory compliance of the MCB Project. To serve as proof of financial capability to comply with the condition under its Mineral Production
Sharing Agreement ("MPSA"),
required to be submitted by the Department of Environment and
Natural Resources ("DENR")
on or before 13 March 2025.
|
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Availability Period
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First OLSA: The Availability
Period under the First OLSA shall be nine (9) months from signing,
with funding tied to the satisfactory completion of the FEED /
updated FS.
Second OLSA: Subject to
satisfactory completion of the FEED / updated FS,
up to 24 months from signing.
Any undrawn amounts after the
availability periods shall be automatically cancelled.
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Tenor
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Three (3) years for the entire
Facility covering the OLSAs.
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Maturity Date
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3 years after the first drawdown
under the Second OLSA, or within 1 year of the first drawdown under
the First OLSA if the FEED / FS is unsatisfactory.
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Interest Payment and Rate
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Compounded quarterly and added to
the principal amount, payable on Maturity Date.
12.5% fixed interest rate,
compounded quarterly.
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Security Package
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Real Estate Mortgage on MMCI's
mining rights and project-related property.
Security interest in
collateral, moveable assets, and project documents.
Share Collateral on shares of
Makilala Holding Limited and Sodor, Inc. in MMCI.
Control over the project's
financial accounts.
Corporate Suretyship from CLA
for 40% of the Facility Amount.
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Condition precedent to signing the First
OLSA
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Delivery of the Bureau of Internal
Revenue ("BIR")-issued
certificate authorising registration of the transfer of 30,000,000
shares in MMCI, from Makilala Holding Limited ("MHL") to Sodor, Inc (Sodor)., the "Certificate".
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Conditions precedent to first drawdown under the First
OLSA
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Key conditions precedent include,
without limitation, the following:
(a) Delivery of certified true copies of the
Certificate;
(b) A
sworn certification and undertaking by the appropriate officer of
CLA, that (i) CLA has the obligation to issue the Performance
Shares to the Balatoc Tribe under the Memorandum of Agreement with
the tribe[3]; (ii) CLA will not use the
proceeds of the Facility to pay any outstanding intercompany
advance or any Advanced Royalties; (iii) it will not convert any
part of the outstanding shareholder advances into equity, without
the consent of MIC;
(c) A
sworn undertaking by MMCI that it will not use any part of the
proceeds of the Facility to pay or settle the outstanding
shareholder advances of CLA or any part thereof.
(d) Constitution by MMCI of a Project Management Committee
("PMC") which will be
composed of equal representatives from MIC and MMCI.
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Conditions precedent to second drawdown under the First OLSA
and the first drawdown under the Second OLSA
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Customary for transactions of this
nature, including but not limited to:
(a) Satisfactory results of the FEED/FS;
(b) Satisfactory demonstration
that use of previous drawdowns aligns with the works indicated in
the disbursement schedule;
(c) No default on
representations and warranties; and
(d) No material adverse
effect; compliance with financial ratios.
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Transfer Restrictions
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MIC granted a right of first offer
on any sale/transfer of MMCI's assets and/or MMCI shares.
Notwithstanding MIC rejection of first offer, relevant parties
obliged to reoffer to MIC before finally selling to third
party.
During the term of
the Bridge Loan, the
Parties shall negotiate the equity sale of MMCI's shares to
MIC.
For 3 years from the
signing, MMCI cannot sell
or transfer MMCI's assets or shares without MIC's prior written
consent
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Senior in Priority Payment
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MMCI's payment obligations under the
OLSAs shall rank senior to
all other indebtedness and monetary obligations.
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Next Steps
The parties are in the advanced
stages of finalising the Omnibus Loan and Security Agreements
reflecting the terms of the binding term sheet. A further
announcement will be made once concluded.
Meanwhile, MMCI is in the process of
selecting a suitable engineering company to update its FS and FEED.
The Company awarded will be announced after signing of the loan
agreements, alongside the resumption of drilling and onsite
activities to support engineering and early works.
MCB
COPPER-GOLD PROJECT
The MCB Copper-Gold Project (MCB) is
located in the Cordillera Administrative Region in the Philippines,
approximately 320km north of Manila (Figure 1). It is the flagship
project within the Makilala portfolio which also contains other key
prospects in the pipeline for permit renewal/extension.
A maiden JORC Compliant Mineral
Resource Estimate was declared for the MCB Project in January 2021,
comprising 313.8 million tonnes @ 0.48% copper and 0.15g/t gold,
for 1.5 million tonnes of contained copper and 1.47 million ounces
of gold, of which 290.3 million tonnes @ 0.48% copper and 0.15 g/t
gold is classified as Indicated and 23.5 million tonnes @ 0.48%
copper and 0.10 g/t gold is classified as Inferred.
An updated JORC compliant Mineral
Resource Estimate was announced for the MCB Project on 12 December
2022, comprising 338 million tonnes @ 0.47% copper and 0.12 g/t
gold, for a total of 1.6 million tonnes of contained copper and 1.3
million ounces of gold, of which 249 million tonnes @ 0.44% copper
and 0.11 g/t gold is classified as Indicated, 42 million tonnes @
0.52% copper and 0.11 g/t gold is classified as Inferred, and 47
million tonnes @ 0.59% copper and 0.19 g/t gold is classified as
Measured.
A Study for the MCB Project was
announced by CLA on 1 December 2021, which identified the potential
for the development of a copper-gold operation with a 25-year mine
life. The Study was based on an underground mining operation and
processing facility to produce a saleable copper-gold
concentrate.
Highlights from the Study include a
Post tax NPV (8%) of US$464m and IRR of 31%, assuming a copper
price of US$4.00/lb and gold price of US$1,695/oz. Initial capital
expenditure is estimated to be US$253m with a payback period of
approximately 2.7 years. The designed mine production is matched to
a 2.28Mtpa processing plant which will treat ore with an estimated
average grade of 1.14% copper and 0.54g/t gold for the first 10
years of planned production with a C1[4] cash
costs at just US$0.73/lb copper, net of gold credits.
Figure 1.
Location of the
MCB Project in the province of Kalinga, Northern Luzon,
Philippines.
This announcement has been authorised by the Board of
Directors of Celsius Resources Limited.
The information contained within
this announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018.
Listing Rule 5.23 Disclosure
The Company confirms that it is not
aware of any new information or data that relates to Exploration
Results and Mineral Resources at the MCB Project and that all
material assumptions and technical parameters underpinning the
Mineral Resource continue to apply.
Forward Looking Statements
Some of the statements appearing in
this announcement may be in the nature of forward-looking
statements. You should be aware that such statements are only
predictions and are subject to inherent risks and uncertainties.
Those risks and uncertainties include factors and risks specific to
the industries in which the Company operates and proposes to
operate as well as general economic conditions, prevailing exchange
rates and interest rates and conditions in the financial markets,
among other things. Actual events or results may differ materially
from the events or results expressed or implied in any
forward-looking statement.
No forward-looking statement is a
guarantee or representation as to future performance or any other
future matters, which will be influenced by a number of factors and
subject to various uncertainties and contingencies, many of which
will be outside the Company's control.
The Company does not undertake any
obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after
today's date or to reflect the occurrence of unanticipated events.
No representation or warranty, express or implied, is made as to
the fairness, accuracy, completeness or correctness of the
information, opinions or conclusions contained in this
announcement. To the maximum extent permitted by law, none of the
Company's Directors, employees, advisors, or agents, nor any other
person, accepts any liability for any loss arising from the use of
the information contained in this announcement. You are cautioned
not to place undue reliance on any forward-looking statement. The
forward-looking statements in this announcement reflect views held
only as at the date of this announcement.
Celsius Resources Contact
Information
Level 5, 191 St. Georges
Terrace
Perth WA 6000
PO Box 7059
Cloisters Square PO
Perth WA 6850
P: +61 2 8072 1400
E: info@celsiusresources.com.au
W: www.celsiusresources.com
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Celsius Resources Limited
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Mark van Kerkwijk
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P: +61 8 9324 4516
E: info@celsiusresources.com.au
W: www.celsiusresources.com
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Multiplier Media
(Australia Media
Contact)
Jon Cuthbert
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M: +61 402 075 707
E: jon.cuthbert@multiplier.com.au
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Beaumont Cornish Limited
(Nominated Adviser)
Roland Cornish/Felicity Geidt/Andrew
Price
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P: +44 (0) 207 628 3396
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Zeus Capital Limited (Broker)
Harry Ansell/James Joyce/James
Bavister
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P: +44 (0) 20 7220 1666
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Beaumont Cornish Limited ("Beaumont Cornish") is the Company's
Nominated Adviser and is authorised and regulated by FCA. Beaumont
Cornish's responsibilities as the Company's Nominated Adviser,
including a responsibility to advise and guide the Company on its
responsibilities under the AIM Rules for Companies and AIM Rules
for Nominated Advisers, are owed solely to the London Stock
Exchange. Beaumont Cornish is not acting for and will not be
responsible to any persons for providing protections afforded to
customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any
matter referred to in it.
