TIDMEMH
European Metals Holdings Limited
09 June 2023
For immediate release
9 June 2023
Land Secured for Cinovec Lithium Plant
Highlights:
- Cinovec Project Company, Geomet s.r.o. secures ownership of
Dukla industrial site for construction of the Cinovec lithium
plant
- Dukla Plant site will include ore beneficiation plant and battery-grade lithium plant
- Geomet s.r.o., owner of 100% of the Cinovec Project, to become sole owner/user of site
European Metals Holdings Limited ( ASX & AIM: EMH, OTCQX:
EMHXY, ERPNF and EMHLF ) (" European Metals " or the " Company ")
is pleased to announce Geomet s.r.o (its 49% owned subsidiary) has
agreed to purchase land at the industrial site "Dukla" in the
Újezdeček Municipality, 6.2 km south of the planned Cinovec Mine
portal area, on which it intends to construct a lithium plant, for
a total purchase consideration of US$ 43.96m.
Commenting on the land purchases, European Metals Executive
Chairman Keith Coughlan said:
"Acquiring this land secures an integral part of the Cinovec
Project - the acquisition of the land on which the Lithium Plant is
to be built. The close location of Dukla to the mine site is
critical to the minimisation of transport costs and ESG impact. The
acquired land is zoned for industrial use.
With the land now secured, DRA Global can complete the layout
designs for the lithium plant which are required as part of the
DFS. This enables the timeline to completion to be maintained."
Dukla Processing Plant Site
The Dukla site, which is subject to an existing industrial usage
permit, is owned by four private companies, with all peripheral and
adjacent land relevant to the site held by Czech State and/or local
public bodies.
The Cinovec Project holding company, Geomet s.r.o. ( Geomet )
which is a forty nine percent (49%) owned subsidiary of European
Metals, has agreed to acquire one of the privately-held land
packages and entered into exclusive and unconditional option
agreements for the purchase of the other three.
The Dukla site has been confirmed as an appropriate site upon
which to build a lithium plant for the beneficiation of Cinovec ore
and production of battery-grade lithium in accordance with the
Company's ongoing DFS which is on track to be completed in 4Q23.
This confirmation has been obtained as a result of engineering
layout and design work undertaken in the DFS to-date,
geohydrological and geotechnical surveys over the site, completed
in early 2023.
An application to the Usti Regional Department of Land Use
Planning for the rezoning of the land around the Dukla site (which
is already zoned for industrial use), ore transport corridor
options and the Cinovec Mine portal area was made in April 2022.
The result of this re-zoning application is expected to be
finalised in 4Q23. The Company intends to exercise its 3 options
and settle these land acquisitions after the re-zoning application
has been successful, anticipated to occur in 2024.
Figure 1 below shows the Dukla site, including the land packages
to be acquired. Figure 2 shows the Dukla site in the context of the
local area and the Cinovec Mine portal.
Principal Terms of the Dukla Land Contracts
Geomet signed the contracts having future options to acquire all
necessary lands in Dukla location at total value of CZK966m (US$
43.96m) . EMH has provided a loan of CZK 121m (US$ 5.51m) to Geomet
for its proportion of all deposits and option fees. The Company
funded the loan to Geomet using cash at bank and anticipates that
the remainder of the monies to be paid at exercise of the Option
will be funded as part of the project financing for the Cinovec
Project. Each of the contracts are unconditional.
1. Seller - Imola Company a.s. (17.5 Ha, shown in purple in Figure 2)
-- Option to purchase the land
-- Payments made up to the date of exercise of the option
-- Final date for exercise of option to purchase is 31(st) July 2025
-- Geomet has received a pledge over the land
2. Seller - FVE Tech s.r.o. (2.2 Ha, shown in red in Figure
2)
-- Option to purchase the land
-- Final date for exercise of option to purchase is 31(st) July 2025
-- Geomet has received a pledge over the land
3. Seller - MC Centrum a.s. (Deskform) (4.1 Ha, shown in green in Figure 2)
-- Acquired MC Centrum a.s.
-- Final date for exercise of option to purchase 31(st) July 2025
-- A mortgage in favour of the Joint venture partners
(Severoceske Doly and the Company) has been granted over the
land.
4. Seller - DATOU s.r.o. (0.5 Ha, shown in orange in Figure 2)
-- CZK 120,000 (US$5,400) deposit paid.
-- CZK 930,000 (US$41,850) to be paid on completion.
-- Acquisition will complete upon entry into land registry,
expected on or around 3(rd) July 2023
Figure 1: Orange boundary shows the full Dukla land package with
the grey area currently in the regional re-zoning permitting
process. Purple, green, red and orange areas are the land packages
being acquired or secured by contract as detailed in this
announcement; in aggregate, these correspond approximately to the
existing industrially-permitted area. All of the grey area within
the regional re-zoning application area is held by Czech State and
local public bodies. The majority of the grey area is required for
land access (road/rail) and/or plant construction purposes.
Purple Imola Company a.s. land package secured by contract,
including rail spur land adjoining existing rail line.
Red FVE Tech s.r.o. land package secured by contract.
Green MC Centrum a.s. (Deskform) land package secured by contract.
Orange DATOU s.r.o. , due to complete until 3(rd) July 2023 at the latest.
Figure 2: The Dukla Plant Site in the local context showing the
mine portal area 6.23km to the north. The Project sites are north
and north-west of the industrial town of Teplice. The elongated
north/south town shown in Figure 2 is Dubí.
This announcement has been approved for release by the
Board.
CONTACT
For further information on this update or the Company generally,
please visit our website at www.europeanmet.com or see full contact
details at the end of this release.
BACKGROUND INFORMATION ON CINOVEC
PROJECT OVERVIEW
Cinovec Lithium/Tin Project
Geomet s.r.o. controls the mineral exploration licenses awarded
by the Czech State over the Cinovec Lithium/Tin Project. Geomet has
been granted a preliminary mining permit by the Ministry of
Environment and the Ministry of Industry. The company is owned 49%
by EMH and 51% by CEZ a.s. through its wholly owned subsidiary,
SDAS. Cinovec hosts a globally significant hard rock lithium
deposit with a total Measured Mineral Resource of 53.3Mt at 0.48%
Li(2) O and 0.08% Sn, Indicated Mineral Resource of 360.2Mt at
0.44% Li(2) O and 0.05% Sn and an Inferred Mineral Resource of
294.7Mt at 0.39% Li(2) O and 0.05% Sn containing a combined 7.39
million tonnes Lithium Carbonate Equivalent and 335.1kt of tin (
refer to the Company's ASX release dated 13 October 2021) (
Resource Upgrade at Cinovec Lithium Project ).
An initial Probable Ore Reserve of 34.5Mt at 0.65% Li(2) O and
0.09% Sn reported 4 July 2017 ( Cinovec Maiden Ore Reserve -
Further Information ) has been declared to cover the first 20 years
mining at an output of 22,500tpa of lithium carbonate (refer to the
Company's ASX release dated 11 July 2018) ( Cinovec Production
Modelled to Increase to 22,500tpa of Lithium Carbonate ).
This makes Cinovec the largest hard rock lithium deposit in
Europe, the fifth largest non-brine deposit in the world and a
globally significant tin resource.
The deposit has previously had over 400,000 tonnes of ore mined
as a trial sub-level open stope underground mining operation.
On 19 January 2022, EMH provided an update to the 2019 PFS
Update, conducted by specialist independent consultants, which
indicates a post-tax NPV of USD1.938B and a post-tax IRR of 36.3%
and confirmed that the Cinovec Project is a potential low operating
cost producer of battery-grade lithium hydroxide or battery grade
lithium carbonate as markets demand. It confirmed the deposit is
amenable to bulk underground mining (refer to the Company's ASX
release dated 19 January 2022) ( PFS Update delivers outstanding
results ). Metallurgical test-work has produced both battery-grade
lithium hydroxide and battery-grade lithium carbonate in addition
to high-grade tin concentrate at excellent recoveries. Cinovec is
centrally located for European end-users and is well serviced by
infrastructure, with a sealed road adjacent to the deposit, rail
lines located 5 km north and 8 km south of the deposit, and an
active 22 kV transmission line running to the historic mine. As the
deposit lies in an active mining region, it has strong community
support.
The economic viability of Cinovec has been enhanced by the
recent strong increase in demand for lithium globally, and within
Europe specifically.
There are no other material changes to the original information
and all the material assumptions continue to apply to the
forecasts.
BACKGROUND INFORMATION ON CEZ
Headquartered in the Czech Republic, CEZ a.s. is an established,
integrated energy group with operations in a number of Central and
South-eastern European countries and Turkey. CEZ's core business is
the generation, distribution, trade in, and sales of electri city
and heat, trade in and sales of natural gas, and coal extraction.
CEZ Group is one of the ten largest energy companies in Europe, has
28,000 employees and annual revenue of approximately EUR 9.97
billion.
The largest shareholder of its parent company, CEZ a.s., is the
Czech Republic with a stake of approximately 70%. The shares of CEZ
a.s. are traded on the Prague and Warsaw stock exchanges and
included in the PX and WIG-CEE exchange indices. CEZ's market
capitalization is approximately EUR 17.7 billion.
As one of the leading Central European power companies, CEZ
intends to develop several projects in areas of energy storage and
battery manufacturing in the Czech Republic and in Central
Europe.
CEZ is also a market leader for E-mobility in the region and has
installed and operates a network of EV charging stations throughout
Czech Republic. The automotive industry in the Czech Republic is a
significant contributor to GDP, and the number of EV's in the
country is expected to grow significantly in the coming years.
ENQUIRIES:
European Metals Holdings Limited
Keith Coughlan, Executive Chairman Tel: +61 (0) 419 996 333
Email: keith@europeanmet.com
Kiran Morzaria, Non-Executive Director Tel: +44 (0) 20 7440 0647
Shannon Robinson, Company Secretary Tel: +61 (0) 418 675 845
Email: shannon@europeanmet.com
WH Ireland Ltd (Nomad & Broker)
James Joyce/Darshan Patel Tel: +44 (0) 20 7220 1666
(Corporate Finance)
Harry Ansell (Broking)
Panmure Gordon (UK) Limited (Joint
Broker) Tel: +44 (0) 20 7886 2500
John Prior
Hugh Rich
James Sinclair Ford
Harriette Johnson
Blytheweigh (Financial PR) Tel: +44 (0) 20 7138 3222
Tim Blythe
Megan Ray
Chapter 1 Advisors (Financial PR
- Aus) Tel: +61 (0) 433 112 936
David Tasker
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END
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