European Metals Holdings Limited Quarterly Activities Report (0654V)

TIDMEMH

RNS Number : 0654V

European Metals Holdings Limited

31 October 2017

For immediate release

31 October 2017

EUROPEAN METALS HOLDINGS LIMITED

QUARTERLY ACTIVITIES REPORT - SEPTEMBER 2017

HIGHLIGHTS

 
 *    Drill Results 
 
 *    Appointment of DFS Study Manager 
 
 
   *    Memorandum of Understanding signed with Czech 
        Government 
 

European Metals Holdings Limited ("European Metals" or "the Company") is pleased to report on its activities and continued progress in the development of the globally significant Cinovec Lithium / Tin Project in Czech Republic during the three month period ending September 2017.

DRILL RESULTS

On 16 August 2017 the Company announced analytical results for the first drillhole CIS-4 at the Cinovec Lithium-Tin Project ("the project" or "Cinovec") and reported on its ongoing infill drilling program. Infill drilling was undertaken in the southwest section of the deposit, targeting two 'gaps' in the resource model that could potentially be targeted for mining in the initial years. Five out of six planned drillholes were completed during the period, for a total of 2163.1m. Assays have been received for the first drillhole CIS-4, which returned a continuous mineralized intercept of 148.30m averaging 0.40%Li(2) O from 297.7m drill string depth. In addition, the upper section of the main lithium interval contains significant tin and tungsten mineralization with 15.85 meters averaging 0.70% Li(2) O, 0.29% tin and 0.073% tungsten.

APPOINTMENT OF DFS STUDY MANAGER & TEAM

The Company welcomed Craig Reimer to the position of DFS Manager during the quarter. Craig has over 25 years' experience in project management, engineering management and business management, and has delivered successful international mining projects for previous clients. Craig is a Mechanical Engineer.

He has previously worked on projects for BHP, Vale Inco, Atlas Iron, ENK, Lynas Rare Earths, Boddington Gold Mine, Alcoa, Jacobs and UGL. The projects range from scoping and feasibility studies, to front-end engineering and detail design, and on to construction and commissioning. Craig has previously worked on projects in Australia, UK, USA, Canada, Indonesia, Phillipines and Malaysia.

The Company is also pleased to have retained the services of Grant Harman as Metallurgical Consultant to the DFS. Grant is one of the world's foremost lithium metallurgist and played a significant role in the Company's successful PFS.

Grant was previously Manager Lithium Chemicals for Talison Lithium and was involved in the management of the Talison Lithium Carbonate Plant from Scoping Study to Definitive Feasibility Study. He was involved in the design and technical direction of the Talison Test Facility and has more recently been a technical consultant on the Sonora Lithium Project in Mexico.

Grant has had previous roles with UGL, SNC Lavalin, CleanTec, and Ausenco,

The expertise and experience of Craig and Grant will be complimented well by the Company's Czech based team, led by Executive Director Richard Pavlik.

DEVELOPMENTS POST REPORTING PERIOD

MEMORANDUM OF UNDERSTANDING SIGNED WITH CZECH GOVERNMENT

On 2 October 2017 the Company announced the signing of a Memorandum of Understanding ("MoU") with The Ministry of Industry and Trade of the Czech Republic regarding the development of the Cinovec Project. The MoU was signed in Usti nad Labem between the Minister of Industry and Trade, Jiri Havlicek and the Company, in the presence of the representatives of the Australian Embassy and Australian Trade and Investment Commission, 1st Deputy Governor of Usti Region Mr Martin Klika, president of the Tripartite of Usti Region, Mrs Gabriela Nekolova, Chairman of the Regional Bureau of Czechinvest Mrs Alena Hajkova, Chairman of the Regional Mining Bureau Mr Milos Matz, Mayor of the Town of Dubí Mr Petr Pipal and other guests.

The MoU expresses mutual willingness to:

 
 
    *    work together to maximise downstream processing 
         options within the Czech Republic; 
 
    *    investigate suitable locations for processing 
         facilities for the Cinovec Project to minimize 
         impacts on the community and environment but maximize 
         positive impacts on the economy and employment of 
         persons of the area surrounding the Cinovec Project; 
 
    *    co-operate to ensure all regulatory requirements are 
         met, using best practices, and work together to 
         ensure all permitting and regulatory issues are 
         addressed in a timely manner; 
 
    *    discuss and explore possibilities of future bilateral 
         agreements between the Czech authorities and European 
         Metals Holdings Limited concerning the framework of 
         future cooperation in the sector of lithium, 
         including the potential involvement of the Czech 
         Government as an equity participant in European 
         Metals Holdings Limited Cinovec Project; 
 
    *    support and facilitate investment linked with these 
         activities; and 
 
    *    continue to co-operate with the Czech academic 
         research bases with regards to ongoing research into 
         the processing of lithium ores. 
 

BACKGROUND INFORMATION ON CINOVEC

PROJECT OVERVIEW

Cinovec Lithium/Tin Project

European Metals, through its wholly owned Subsidiary, Geomet s.r.o., controls the mineral exploration licenses awarded by the Czech State over the Cinovec Lithium/Tin Project. Cinovec hosts a globally significant hard rock lithium deposit with a total Indicated Mineral Resource of 348Mt @ 0.45% Li(2) O and 0.04% Sn and an Inferred Mineral Resource of 309Mt @ 0.39% Li(2) O and 0.04% Sn containing a combined 7.0 million tonnes Lithium Carbonate Equivalent and 263kt of tin. An initial Probable Ore Reserve of 34.5Mt @ 0.65% Li2O and 0.09% Sn has been declared to cover the first 20 years mining at an output of 20,800tpa of lithium carbonate.

This makes Cinovec the largest lithium deposit in Europe, the fourth 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.

EMH has completed a Preliminary Feasibility Study, conducted by specialist independent consultants, which indicated a return post tax NPV of USD540m and an IRR of 21%. It confirmed the deposit is be amenable to bulk underground mining. Metallurgical test work has produced both battery grade lithium carbonate and 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.

CONTACT

For further information on this update or the Company generally, please visit our website at www. http://europeanmet.com or contact:

Mr. Keith Coughlan

Managing Director

COMPETENT PERSON

Information in this release that relates to exploration results is based on information compiled by Dr Pavel Reichl. Dr Reichl is a Certified Professional Geologist (certified by the American Institute of Professional Geologists), a member of the American Institute of Professional Geologists, a Fellow of the Society of Economic Geologists and is a Competent Person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves and a Qualified Person for the purposes of the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009. Dr Reichl consents to the inclusion in the release of the matters based on his information in the form and context in which it appears. Dr Reichl holds CDIs in European Metals.

The information in this release that relates to Mineral Resources and Exploration Targets has been compiled by Mr Lynn Widenbar. Mr Widenbar, who is a Member of the Australasian Institute of Mining and Metallurgy, is a full time employee of Widenbar and Associates and produced the estimate based on data and geological information supplied by European Metals. Mr Widenbar has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the JORC Code 2012 Edition of the Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves. Mr Widenbar consents to the inclusion in this report of the matters based on his information in the form and context that the information appears.

CAUTION REGARDING FORWARD LOOKING STATEMENTS

Information included in this release constitutes forward-looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as "may", "will", "expect", "intend", "plan", "estimate", "anticipate", "continue", and "guidance", or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs.

Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the company's actual results, performance and achievements to differ materially from any future results, performance or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licences and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.

Forward looking statements are based on the company and its management's good faith assumptions relating to the financial, market, regulatory and other relevant environments that will exist and affect the company's business and operations in the future. The company does not give any assurance that the assumptions on which forward looking statements are based will prove to be correct, or that the company's business or operations will not be affected in any material manner by these or other factors not foreseen or foreseeable by the company or management or beyond the company's control.

Although the company attempts and has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in forward looking statements, there may be other factors that could cause actual results, performance, achievements or events not to be as anticipated, estimated or intended, and many events are beyond the reasonable control of the company. Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, in providing this information the company does not undertake any obligation to publicly update or revise any of the forward looking statements or to advise of any change in events, conditions or circumstances on which any such statement is based.

LITHIUM CLASSIFICATION AND CONVERSION FACTORS

Lithium grades are normally presented in percentages or parts per million (ppm). Grades of deposits are also expressed as lithium compounds in percentages, for example as a percent lithium oxide (Li(2) O) content or percent lithium carbonate (Li(2) CO(3) ) content.

Lithium carbonate equivalent ("LCE") is the industry standard terminology for, and is equivalent to, Li(2) CO(3) . Use of LCE is to provide data comparable with industry reports and is the total equivalent amount of lithium carbonate, assuming the lithium content in the deposit is converted to lithium carbonate, using the conversion rates in the table included below to get an equivalent Li(2) CO(3) value in percent. Use of LCE assumes 100% recovery and no process losses in the extraction of Li(2) CO(3) from the deposit.

Lithium resources and reserves are usually presented in tonnes of LCE or Li.

The standard conversion factors are set out in the table below:

Table: Conversion Factors for Lithium Compounds and Minerals

 
 Convert from                  Convert   Convert     Convert to 
                                to Li     to Li(2)    Li(2) CO(3) 
                                          O 
-------------------  -------  --------  ----------  ------------- 
 Lithium              Li       1.000     2.153       5.324 
                      Li(2) 
 Lithium Oxide         O       0.464     1.000       2.473 
                      Li(2) 
 Lithium Carbonate     CO3     0.188     0.404       1.000 
-------------------  -------  --------  ----------  ------------- 
 

WEBSITE

A copy of this announcement is available from the Company's website at www.europeanmet.com.

ENQUIRIES:

 
 European Metals Holdings            Tel: [phone] 
  Limited                             333 
  Keith Coughlan, Chief               Email: [e-mail] 
  Executive Officer                   Tel: [phone] 
  Kiran Morzaria, Non-Executive       0647 
  Director                            Tel: [phone] 
  Julia Beckett, Company              Email: [e-mail] 
  Secretary 
 Beaumont Cornish (Nomad            Tel: [phone] 
  & Broker)                          3396 
  Michael Cornish                    Email: [e-mail] 
  Roland Cornish 
 

The information contained within this announcement is considered to be inside information, for the purposes of Article 7 of EU Regulation 596/2014, prior to its release.

This information is provided by RNS

The company news service from the London Stock Exchange

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October 31, 2017 03:32 ET (07:32 GMT)