ASX/AIM RELEASE
18
MARCH 2024
MCB Project Mining
Permit
granted by Philippine
Government
HIGHLIGHTS
· The
Philippine Department of Environment and Natural Resources has
approved MCB's mining permit on 15 March 2024, valid for 25 years
and renewable for another 25 years.
· The permit
grants the Company exclusive rights to undertake rational
exploration, development, and commercial production of copper and
associated minerals.
· The
issuance of the mining permit will enable the Company to undertake
the necessary work streams to proceed with MCB mine
development.
_______________________________________________________________________________
Celsius Resources Limited
("CLA", "Celsius" or the "Company") (ASX, AIM: CLA) is pleased to
announce that its Philippine subsidiary, Makilala Mining Company,
Inc. ("MMCI or the
"Contractor"), has obtained a
Mineral Production Sharing Agreement ("MPSA" or the "Agreement") with the Philippine
Government for its flagship Maalinao-Caigutan-Biyog Mining Project
("MCB" or the
"Project").
The issuance of the MPSA, which is
the first copper project to be approved in the Philippines in the
last fifteen years, grants MMCI the
exclusive right to undertake rational exploration, development, and
commercial production of copper and associated minerals within the
Contract Area covering approximately 2,500 hectares for a period of
25 years and is renewable for another 25 years.
Celsius Executive Chairman
Atty. Julito R. Sarmiento, said:
"The issuance of the mining permit has been much awaited by
Celsius and the Balatoc Community. Now is our chance to deliver on
our firm commitment to work with the Government and the local
communities to develop the MCB Project in a sustainable manner that
creates value not only for our shareholders but also for our
communities.
We
are grateful to the Philippine Government under the bold leadership
of His Excellency President Ferdinand R. Marcos, Jr. and to the
Department of Environment and Natural Resources under the visionary
stewardship of Secretary Maria Antonia Yulo-Loyzaga for supporting
the MCB Project. We are seriously taking the Government's call for
the Project to go beyond compliance by striking a balance between
keeping the business viable, protecting and rehabilitating the
environment, uplifting local communities, and supporting the
Government's socio-economic agenda. With strong Government
support, we are confident that we can make this
happen."
Celsius Managing Director
Peter Hume, said:
"The grant of the MCB mining permit marks the progression of
Celsius from being known as an exploration company to a mineral
resource developer, and eventually a mine operator. Credit goes out
to our hard working in-country team who strived to get the Project
up to this stage in such a short timeframe amidst all the
challenges.
Over the last eighteen months, the Company has been
interfacing with potential investors who have shown resounding
interest in the MCB Project but have been also waiting for the
issuance of the mining permit. With this now in hand, the Company
will proceed with finalising funding options for the
Project.
The in-country team has commenced planning for the next
exciting phase in the development of the Project. We wish to thank
shareholders for their patience, trust, and continued
support."
Ceremonial signing of the
MCB MPSA at the Mines and Geosciences Bureau (MGB) Office (from
L-R: CLA Managing Director Peter Hume, MGB Chief of Mining
Tenements Management Division Engr. Danilo Deleña, CLA Executive
Chairman Atty Julito Sarmiento, and CLA Sustainability Director
Attilenore Manero)
Mineral Production Sharing Agreement
The Republic Act No. 7942, otherwise
known as "The Philippine Mining Act of 1995," (the "Mining Act") which took effect on 09
April 1995, provides that the Secretary of the Department of
Environment and Natural Resources is authorised to enter into
Mineral Production Sharing Agreements in furtherance of the
objectives of the Government and the Philippine Constitution to
bolster the national economy through sustainable and systematic
development and utilisation of mineral lands.
Specifically, the Government has
granted MMCI a permit via an MPSA to undertake mining operations of
the MCB Project under the key following provisions:
Scope
Pursuant to the provisions of the
Mining Act and its implementing rules and regulations, the primary
purpose of the Agreement is to provide for the sustainable
development and commercial utilisation of associated mineral
deposits existing within the Contract Area, with all necessary
services, technology, and financing to be furnished or arranged by
the Contractor in accordance with the provisions of the
Agreement.
The Contractor shall undertake and
execute, for and on behalf of the Government, responsible mining
operations in accordance with the provisions of the
Agreement.
During the term of the Agreement,
the total value of production and sale of minerals derived from the
mining operations shall be accounted for and divided between the
Government and the Contractor in accordance with fiscal regime
provisions summarised below.
Term of
Agreement
The Agreement shall have an initial
term of six (6) months from the date of grant. During this initial
term, MMCI is required to submit the following:
§ Additional
proof of financial capability to undertake the implementation of
the pertinent Work Programs, and
§ Certification Precondition issued by the National Commission
on Indigenous Peoples.
Subject to compliance with the above
requirements, the Agreement shall have a term of twenty-five (25)
years from the date of grant and may be renewed thereafter for
another term not exceeding twenty-five (25) years.
Celsius and MMCI are progressing
with the satisfaction of the above conditions by re-engaging with
potential investors both in the Philippines and internationally who
have shown strong interest in supporting and funding the
development of the Project but have been waiting for the mining
permit to be issued.
MMCI is proceeding through the
process of obtaining the Certificate of Pre-condition as part of
the Free, Prior and Informed Consent ("FPIC") Process which is
governed by the National Commission on
Indigenous Peoples ("NCIP"). As announced to ASX on 15 November
2022, MMCI signed an agreement with the Balatoc Tribe community
setting out the terms and conditions for the use of their land for
the purpose of mining. Now that the mining permit has been issued,
MMCI can request the Certificate of Pre-condition to be issued by
the NCIP.
Fiscal
Regime
General Principle -
The fiscal regime is governed
by the general principle according to which the Government expects
a reasonable return in economic value for the utilisation of
non-renewable mineral resources under its national sovereignty
while the Contractor expects a reasonable return on its investment
with special account to be taken for the high risk of exploration,
the terms and conditions prevailing elsewhere in the industry and
any special efficiency to be gained by a particularly good
performance of the Contractor.
Occupation Fees
- Prior to registration of the
Agreement and at the same date every year thereafter, the
Contractor must pay to the Municipal/City Treasurer concerned an
occupation fee over the Contract Area at the annual rate provided
in the existing rules and regulations. As at the date of this
announcement, the annual occupation fee which would apply to the
Contract Area would be approximately A$5,000 per year.
Share of the Government
- The Government share of production
shall be the excise tax on mineral products at the time of removal
and at the rate provided for in Republic Act No. 7729 amending
Section 151 (a) of the National Internal Revenue Code, as amended,
in addition to a royalty of not less than four percent (4%)
of the gross output, as well as other taxes, duties and fees levied
by existing laws.
Rights and Obligations of the Parties
Main Obligations of the
Contractor:
§ Exclusively conduct sustainable mining operations within the
Contract Area in accordance with the provisions of the Mining Act
and its implementing rules and regulations;
§ Construct
and operate any facilities specified under the Mineral Agreement or
approved work program;
§ Determine
the exploration, mining and treatment process to be utilised in the
mining operations;
§ Extract,
remove, use and dispose of any tailings as authorised by an
approved work program;
§ Secure all
permits necessary or desirable for the purpose of mining
operations;
Environmental Protection and Mine Safety and
Health
§ Mining
operations shall be done in a technically, financially, socially,
culturally and environmentally responsible manner to achieve the
sustainable development objectives and responsibilities as provided
for under the implementing rules and regulations of the Mining
Act.
§ Comply
with the approved Environmental Protection and Enhancement Program
(EPEP) allocating an annual amount equivalent to three to five
percent (3%-5%) of the MCB Project's direct mining and milling
costs depending on the environmental/geologic condition, nature and
scale of operations and technology employed in the Contract
Area.
§ Establish
a Contingent Liability and Rehabilitation Fund (CLRF) which shall
be in the form of the Mine Rehabilitation Fund (MRF) and the Mine
Waste and Tailings Fee (MWTF), although for MCB, the mine Waste and
Tailings fee will not be applicable due to the implementation of
paste backfill. The MRF shall be based on the financial
requirements of the approved EPEP as a reasonable environmental
deposit to ensure satisfactory compliance with the
commitments/strategies of the annual EPEP and availability of funds
for the performance of the same during the specific project
phase.
Community Development
§ Allocate
an annual royalty payment of not less than one percent (1%) of the
value of the gross output of minerals sold;
§ Allocate
annually a minimum of one point five percent (1.5%) of the
operating costs necessary for the development of the host and
neighboring communities;
§ Preferential hiring of qualified local Filipino citizens
during mining operations including the conduct of training and
recruitment programs aimed to develop local skills and expertise at
the Contractor's expense.
Rights of the
Contractor:
o Conduct mining operations within the confines of its
Contract/Mining Area, as defined in the MPSA;
o Possession of the Contract Area, with full right of ingress
and egress and the right to occupy the same, subject to surface and
easement rights;
o Use
and access to all declassified geological, geophysical, drilling,
production and other data relevant to the mining
operations;
o Sell, assign, transfer, convey or otherwise dispose of all its
rights, interests and obligations under the Agreement subject to
the approval of the Government;
o Employ or bring into the Philippines foreign technical and
specialised personnel, including the immediate members of their
families as may be required in the operations of the Contractor,
subject to applicable laws and regulations;
o Easement rights and use of timber, water and other natural
resources in the Contract Area subject to pertinent laws, rules and
regulations and the rights of third parties;
o Repatriation of capital and remittance of profits, dividends
and interest on loans, subject to existing laws and Bangko Sentral
ng Pilipinas rules and regulations; and
o Importation, when necessary, of all equipment, spare parts and
raw materials required in the operations in accordance with
existing laws and regulations.
Obligations of the
Government:
o Ensure that the Contractor has the Government's full
cooperation in the exercise of the rights granted to it under the
Agreement;
o Use
its best efforts to ensure the timely issuance of necessary permits
and similar authorising documents for use of the surface of the
Contract Area; and
o Cooperate with the Contractor in its efforts to obtain
financing from banks or other financial institutions; provided that
such financing arrangements will in no event reduce the
Contractor's obligations in relation to the Government's rights
under the Agreement.
MCB
MINING PROJECT
The MCB Mining Project (MCB) is
located in the Cordillera Administrative Region in the Philippines,
approximately 320km north of Manila (Figure 1). It is the flagship
project within the Makilala portfolio which also contains other key
prospects in the pipeline for permit renewal/extension.
A maiden JORC Compliant Mineral
Resource Estimate was declared for the MCB Project in January 2021,
comprising 313.8 million tonnes @ 0.48% copper and 0.15g/t gold,
for 1.5 million tonnes of contained copper and 1.47 million ounces
of gold, of which 290.3 million tonnes @ 0.48% copper and 0.15 g/t
gold is classified as Indicated and 23.5 million tonnes @ 0.48%
copper and 0.10 g/t gold is classified as Inferred.
An updated JORC compliant Mineral
Resource Estimate was announced for the MCB Project on 12 December
2022, comprising 338 million tonnes @ 0.47% copper and 0.12 g/t
gold, for a total of 1.6 million tonnes of contained copper and 1.3
million ounces of gold, of which 249 million tonnes @ 0.44% copper
and 0.11 g/t gold is classified as Indicated, 42 million tonnes @
0.52% copper and 0.11 g/t gold is classified as Inferred, and 47
million tonnes @ 0.59% copper and 0.19 g/t gold is classified as
Measured.
A Study for the MCB Project was
announced by CLA on 1 December 2021, which identified the potential
for the development of a copper-gold operation with a 25-year mine
life. The Study was based on an underground mining operation and
processing facility to produce a saleable copper-gold
concentrate.
Highlights from the Study include a
Post tax NPV (8%) of US$464m and IRR of
31%, assuming a copper price of US$4.00/lb and gold price of
US$1,695/oz. Initial capital expenditure is estimated to be US$253m
with a payback period of approximately 2.7 years. The designed mine
production is matched to a 2.28Mtpa processing plant which will
treat ore with an estimated average grade of 1.14% copper and
0.54g/t gold for the first 10 years of planned production with a
C1[1] cash costs at just US$0.73/lb copper,
net of gold credits.
Figure 1.
Location of the
MCB Project in the province of Kalinga, Northern Luzon,
Philippines.
This announcement has been authorised by the Board of
Directors of Celsius Resources Limited.
The information contained within
this announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018.
Listing Rule 5.19 and 5.23 Disclosure
The production targets and forecast
financial information disclosed in this announcement were disclosed
in the Company's ASX announcement dated 1
December 2021 titled "Positive
Scoping Study completed on MCB Copper-Gold Project confirms
significant potential". The Company confirms that all
material assumptions underpinning the production targets and
forecast financial information derived from production targets in
the previous announcement continue to apply and have not materially
changed.
The Mineral Resource estimate for
the MCB Project was disclosed in the Company's ASX Announcement
dated 12 December 2022 titled "Updated Mineral Resource for
Celsius' MCB Copper-Gold Project". The Company confirms that
it is not aware of any new information or data that materially
affects the information included in the previous announcement and
that all material assumptions underpinning the Mineral Resource
estimate continue to apply and have not materially
changed.
Forward Looking Statements
Some of the statements appearing in
this announcement may be in the nature of forward-looking
statements. You should be aware that such statements are only
predictions and are subject to inherent risks and uncertainties.
Those risks and uncertainties include factors and risks specific to
the industries in which the Company operates and proposes to
operate as well as general economic conditions, prevailing exchange
rates and interest rates and conditions in the financial markets,
among other things. Actual events or results may differ materially
from the events or results expressed or implied in any
forward-looking statement.
No forward-looking statement is a
guarantee or representation as to future performance or any other
future matters, which will be influenced by a number of factors and
subject to various uncertainties and contingencies, many of which
will be outside the Company's control.
The Company does not undertake any
obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after
today's date or to reflect the occurrence of unanticipated events.
No representation or warranty, express or implied, is made as to
the fairness, accuracy, completeness or correctness of the
information, opinions or conclusions contained in this
announcement. To the maximum extent permitted by law, none of the
Company's Directors, employees, advisors, or agents, nor any other
person, accepts any liability for any loss arising from the use of
the information contained in this announcement. You are cautioned
not to place undue reliance on any forward-looking statement. The
forward-looking statements in this announcement reflect views held
only as at the date of this announcement.
Celsius Resources Contact
Information
Level 5, 191 St. Georges
Terrace
Perth WA 6000
PO Box 7059
Cloisters Square PO
Perth WA 6850
P: +61 2 8072 1400
E: info@celsiusresources.com.au
W: www.celsiusresources.com
Celsius Resources Limited
|
|
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Peter Hume
|
P: +61 2 8072 1400
E: info@celsiusresources.com.au
W: www.celsiusresources.com
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Multiplier Media
(Australia Media
Contact)
Jon Cuthbert
|
M: +61 402 075 707
E: jon.cuthbert@multiplier.com.au
|
|
Tavistock Communications
(UK Media and Investor
Relations)
|
+44 (0) 207 628 3396
|
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Charles Vivian
|
M: 0044 7977297903
E:
charles.vivian@tavistock.co.uk
|
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Tara Vivian-Neal
|
M: 0044 7394408654
E:
tara.vivian-neal@tavistock.co.uk
|
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Beaumont Cornish Limited
(Nominated Adviser)
Roland Cornish/Felicity Geidt/Andrew
Price
|
P: +44 (0) 207 628 3396
|
WH
Ireland (Broker)
Harry Ansell/James Joyce/Isaac
Hooper
|
P: +44 (0) 20 7220 1666
|
|
|
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Beaumont Cornish Limited ("Beaumont Cornish") is the Company's
Nominated Adviser and is authorised and regulated by FCA. Beaumont
Cornish's responsibilities as the Company's Nominated Adviser,
including a responsibility to advise and guide the Company on its
responsibilities under the AIM Rules for Companies and AIM Rules
for Nominated Advisers, are owed solely to the London Stock
Exchange. Beaumont Cornish is not acting for and will not be
responsible to any persons for providing protections afforded to
customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any
matter referred to in it.