Corcel PLC Signature of Battery Metals Joint Venture (4129R)

TIDMCRCL

RNS Number : 4129R

Corcel PLC

01 March 2023

Corcel PLC

("Corcel" or the "Company")

Signature of Battery Metals Joint Venture

1 March 2023

Corcel Plc (London AIM: CRCL), the extractive industries exploration and development company, with interests in battery metals including nickel, cobalt, and rare earth elements, announces that it has entered into agreements with Integrated Energy Metals ("IEM") restructuring the Company's PNG battery metals assets into a new carried vehicle, Integrated Battery Metals ("IBM"). It is intended that IBM will, ultimately, be listed in Asia, as previously announced on 17 October 2022.

Highlights:

o IBM joint venture to own Corcel's holdings in the Mambare and Wowo Gap projects alongside IEM's interest in the Doncella lithium project in Argentina

o Corcel, pursuant to its recently announced strategy, will own 50% of IBM, benefit from a US$1.5m carried interest and a 1.5% gross revenue royalty on Wowo Gap and will nominate half of the board of IBM

o Corcel and IEM intend to further progress this joint venture and to potentially inject additional assets into IBM prior to pursuing a listing in either Singapore or Australia

Corcel Chief Executive Officer, Scott Kaintz commented: "We are pleased to announce the signature of this joint venture, which both funds near term spend on our PNG nickel assets and positions them in a broader portfolio ready for a standalone listing. Progression of this transaction is a major step forward in Corcel's strategy to build a non-operated and carried portfolio of upstream battery metal projects alongside new oil and gas opportunities, including in Brazil where the Company sees unique and significant opportunities at this moment."

Battery Metals Interest Restructuring and Joint Venture

As previously announced, Corcel has agreed to inject its 41% interest in the Mambare nickel/cobalt project as well as its 100% interest in the Wowo Gap nickel/cobalt project, and IEM has agreed to inject its 4.04% interest in Hanacolla S.A., owner of the Doncella lithium project in Argentina, with additional lithium and other battery metal interests expected to follow.

The joint venture agreement has now been entered into by Corcel and IEM, with completion of this transaction being conditional on the following:

o Corcel's Mambare partner's pre-emption rights being waived during a 45-day review period

o Hanacolla shares being transferred into IBM

o Initial funding of Corcel's carried interest being demonstrated in the form of US$1m deposited into IBM's bank account by IEM via a convertible loan structure

o Consent and assignment of Corcel's existing gross smelter royalty over Mambare to IBM

o Execution and commencement of the IBM shareholders agreement

IEM and Corcel have made arrangements to begin Corcel's carried interest period as of 1 January 2023, in order to minimise the ongoing burden of project costs from the Company ahead of completion of the transaction. The initial funding for IBM, to pay the carry to Corcel, will be received from IEM via a three-year convertible loan structure with a 5% annual coupon which converts at the lower of US$1.35 / share (a 35% premium on the implied entry price of Corcel and IEM) (the "Loan") or the price realised at the IPO of IBM. Conversion occurs at the earlier of the end of the term of the Loan, an IPO or a sale of the portfolio.

The agreement includes standard industry warranties provided by both parties and tag and drag along provisions in the event of a sale of the equity in IBM.

Further information

The losses attributable for the twelve-month period ending 30 June 2022 to the Company's 41% interest in the Mambare project were GBP3.3k, with a further GBP170.2k attributable to the 100% interest in the Wowo Gap project.

The losses attributable to Hanacolla for the Doncella lithium project through 31 December 2022 were $1.66m, with approximately $67k of this attributable to IEM's 4.04% interest.

Further announcements upon completion of the transaction will be made in due course.

For further information, please contact:

   Scott Kaintz                                                Corcel Plc CEO 

020 7747 9960

   James Joyce/James Bavister/Andrew de Andrade         WH Ireland Ltd NOMAD & Broker 

0207 220 1666

   Patrick d'Ancona                                            Vigo Communications IR 

0207 3900 230

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March 01, 2023 02:00 ET (07:00 GMT)