Strategic Minerals PLC Cobre Sales Contract Update (1545M)

TIDMSML

RNS Number : 1545M

Strategic Minerals PLC

26 April 2018

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

26 April 2018

Strategic Minerals plc

("Strategic Minerals" or the "Company")

Cobre Sales Contract Update

Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a producing mineral company actively developing projects prospective for battery materials, wishes to inform the market that its wholly owned subsidiary, Southern Minerals Group ("SMG"), operator of SML's Cobre magnetite stockpile in New Mexico, USA ("Cobre"), has agreed to a temporary (three month) suspension to the minimum tonnage requirement under its contract disclosed on 20 April 2017. The minimum tonnage requirement is 4,000 tons of magnetite per month.

SMG's client has indicated that it is awaiting an environmental planning approval which has taken longer than expected and has requested that the minimum tonnage requirement be suspended for March, April and May of 2018. Given the substantial importance of this client to SMG, having already taken and paid for circa 40,000 tons of magnetite, SMG has agreed to such a temporary suspension of this aspect of its contract.

It should be noted that this does not change, in any manner, the underlying contract with the client, which has a requirement to purchase a further circa 360,000 tons and will, after May, continue to have a minimum purchase requirement of 4,000 tons per month. SMG reports that the client is currently within its payment arrangements with SMG and has, in escrow, a US $250,000 deposit securing its contract.

Commenting, John Peters, Managing Director of Strategic Minerals, said:

"The temporary suspension of the minimum shipment requirement demonstrates the close working relationship that Strategic Minerals and Southern Minerals Group have with our long-term clients. This decision has been made to maximise the outcome for both parties, without detriment to the Company.

"Last quarter's figures did not include any suspended sales, demonstrating that, even without these sales, both SMG and the Company as a whole are profitable.

"Having dealt with similar environmental approval processes before, the Company is understanding of the situation and looks forward to resumption of normal shipments in June."

 
 
For further information, please contact: 
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John Peters 
Managing Director 
www.strategicminerals.net 
 
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Notes to Editors

Strategic Minerals Plc is an AIM-quoted, operating minerals company actively developing projects prospective for battery materials. It has an operation in the United States of America and development projects in the UK and Australia. The Company is focused on utilising its operating cash flows, along with capital raisings, to develop high quality projects aimed at supplying the metals and minerals being sought in the burgeoning electric vehicle/battery market.

In September 2011, Strategic Minerals acquired the Cobre magnetite tailings dam project in New Mexico, USA, a cash-generating asset, which it brought into production in 2012 and which continues to provide a revenue stream for the Company. This operating revenue stream is utilised to cover company overheads and invest in development projects orientated to supplying the burgeoning electric vehicle/battery market.

In January 2016, the portfolio was expanded with the acquisition of shares in Central Australian Rare Earths Pty Ltd, which holds tenements in Western Australia and the Northern Territory that are prospective for cobalt, gold, nickel sulphides and rare earth elements. The Company has since acquired all shares in Central Australian Rare Earths Pty Ltd.

In May 2016, an additional exploration asset was acquired when the Company entered into an agreement with New Age Exploration Limited to acquire up to 50% of the Redmoor Tin/Tungsten project in Cornwall, UK. This 50% acquisition was completed in February 2017 and a drilling programme completed in 2017 resulted in a significant upgrade of the resource.

In March 2018, the Company completed the acquisition of the Leigh Creek Copper Mine situated in the copper rich belt of South Australia and is currently working to bring this into operation in 2019.

This information is provided by RNS

The company news service from the London Stock Exchange

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April 26, 2018 02:00 ET (06:00 GMT)