Marula Mining PLC Formal Document Executed for Larisoro

RNS Number : 1923U

Marula Mining PLC

27 June 2024

 

 

 

Marula Mining PLC

 

("Marula'' or the "Company")

 

27 June 2024

 

Formal Document Executed for Larisoro Manganese Mine Investment

 

Marula Mining (AQSE: MARU A2X: MARU) an African focused mining and development company, announces that formal documentation in respect of its investment in the Larisoro Manganese Mine located in Samburu County in Northern Kenya (the "Larisoro Mine") has been signed with Kenyan company Gems and Industrial Minerals Limited ("GIM").   

The formal documentation which comprises a Mine Support Services Agreement ("MMSA") includes the terms of the Company's mine support services that it will provide as part of the plan to increase monthly manganese ore production and processing at the Larisoro Mine to an initial 10,000 tonnes ("t") of saleable manganese ore and has been agreed to extend for an initial period of 15 years. The MMSA also incorporates all the key commercial terms for the US$1.75 million exploration budget to be funded by Marula. In addition, the Company will provide a further US$1.5million  (as announced on 1 March 2024) of new mobile mining and processing equipment, amounting to, in aggregate,  approx. US$3.25 million investment ("Investment") to be allocated to the development of the Larisoro Mine.

The Investment will be made from future cash flows generated by the Company from the Larisoro Mine, the Blesberg Lithium and Tantalum Mine and from advances due from AUO Commercial LLC under its existing funding arrangements.

The MMSA replaces the binding terms sheet ("Terms Sheet") and the previously contemplated Technical Services and Commercial Agreements, the terms of which were also announced on 1 March 2024. There has been no material changes to the previously agreed commercial terms as announced 1 March 2024, and the milestone payment now of £200,000 due on the signing of the MMSA is to be satisfied through the issue of 2,000,000 of new ordinary shares at an issue price of 10 pence per share ("MMSA Shares").

Highlights:

·    Marula and its wholly owned Kenyan subsidiary Muchai Mining Kenya Limited ("Muchai Mining") have signed a MMSA with GIM for the mine services and associated investment to be provided to the Larisoro Mine over an initial period of 15 years

·    Under the MMSA, Marula through Muchai Mining will invest approx. US$3.25 million to increase monthly manganese ore production and processing at the Larisoro Mine to up to 10,000t

·    The investment will comprise approx. US$1.5 million of new mining, crushing, screening and processing equipment to be provided by Muchai Mining and approx. US$1.75 million to be spent on exploration

·    In consideration for providing the services under the MMSA, Muchai Mining, will receive a 60% share in the net sale proceeds of sales of manganese from the Larisoro Mine

·    Marula has the right to increase this to a 70% share through a payment to GIM of £1.25 million in cash or shares, at the Company's election

·    Since signing the Terms Sheet in March 2024, the Company has commenced exploration activities and investment in mining and processing equipment at the Larisoro Mine

·    The Company has also completed refurbishment, repairs and upgrades to existing equipment on site and operations are ongoing with stockpiled manganese ore ready for sale

·    Additional new mining and processing plant equipment is scheduled to be on site and commissioned in Q3 2024

·    The sale and export of manganese ore will be completed under the agreements in place with United Kingdom based, global metals, minerals and energy commodities trading group Fujax UK Ltd ("Fujax") as announced 31 May 2024 and with an existing Chinese-based manganese smelting group

·    Manganese ore is currently being stockpiled in Nairobi and on site at the Larisoro Mine ahead of the first export sales that are scheduled to commence this week

·    As announced on 1 March 2024, the Company has also agreed, if necessary, to guarantee up to KES 70,000,000 (approximately £376,000) of GIM's existing indebtedness, which GIM is to repay immediately from its attributable cashflow from operations at the Larisoro Mine

Admission

Application has been made for the MMSA Shares to be admitted to trading on the Aquis Stock Exchange Growth Market on or around 4 July 2024 ("Admission") and will rank pari passu with the ordinary shares of the Company in issue.

Total voting rights

Following Admission, the Company's issued share capital will comprise 180,715,665 ordinary shares of 0.01p each, with each share carrying the right to one vote, therefore the total number of voting rights in the Company will be 180,715,665. This figure may be used by shareholders as the denominator for calculations by which they will determine if they are required to notify their interest in the Company, or a change to their interest in the Company, under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

 

Jason Brewer, Marula Mining PLC CEO, said:

"It is pleasing to have now signed the MMSA for the mining and processing activities at the Larisoro Mine and the associated investment in mining and processing equipment and in a broad and systematic exploration program across the license areas.

"Whilst we have been finalising the MMSA we have continued to make good progress over the past few months, with the mining and processing operations continuing in parallel with the ongoing exploration activities. With manganese ore stockpiled both on site and also in Nairobi, we are looking forward to establishing the Larisoro Mine as a consistent producer and exporter of manganese ores to the international markets.

"I'd like to thank the team at GIM and all involved on site at the Larisoro Mine for the hard work that has got us to this point and which now provides for our continued investment and management of the Larisoro Manganese Mine."

 

The Directors of Marula are responsible for the contents of this announcement. This announcement contains inside information for the purposes of UK Market Abuse Regulation.

 

 

About Marula Mining

Marula Mining (AQSE: MARU A2X: MARU) is an African focused battery metals investment and exploration company and has interests in several high value mine projects in Africa; the Blesberg Lithium and Tantalum Mine and Korridor Lithium Project in South Africa, the Kinusi Copper Mine, the Nyorinyori Graphite Project, the NyoriGreen Graphite Project and the Bagamoyo Graphite Project all in Tanzania, the Nkombwa Hill Project in Zambia and the Larisoro Manganese Mine located in Kenya. As we advance operations at these battery metals focused projects, Marula will continue to build and expand its interests in other high-quality projects in Africa.

 

Marula's strategy is to identify and invest in advanced and high-value mining projects throughout East, Central and Southern Africa that the Directors believe would deliver returns for its shareholders. The Board and management team aims to establish Marula as a socially and environmentally responsible, sustainable, and profitable producer of critical metals and commodities that are of increasingly strategic importance to modern technologies and the global economy. Marula's shares are traded on the AQUIS Stock Exchange (AQSE) in the United Kingdom and the A2X Markets in South Africa. Marula is exploring opportunities to admit its shares to trading on the London Stock Exchange plc's Standard List, Kenya's Nairobi Securities Exchange and South Africa's Johannesburg Stock Exchange.

 

For enquiries contact:

 

Marula Mining PLC Jason Brewer, Chief Executive Officer   Faith Kinyanjui Mumbi Investor Relations	Email : [e-mail]   Email : [e-mail]
AQSE Corporate Adviser Cairn Financial Advisers LLP, Liam Murray / Ludovico Lazzaretti	[phone]
Broker Peterhouse Capital Limited, Charles Goodfellow / Duncan Vasey	[phone]
Financial PR and IR BlytheRay Tim Blythe / Megan Ray / Said Izagaren	[phone]

 

Caution:

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ''believe'', ''could'', "should" ''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect", ''will'' or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors.

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