TIDMKZG
RNS Number : 9809E
Kazera Global PLC
05 July 2023
5 July 2023
Kazera Global plc ("Kazera" or "the Company")
Corporate And Operational Update
Kazera Global plc, the AIM-quoted investment company, is pleased
to provide an update on key corporate and operational
developments.
Highlights
-- Strategic shareholder African Mineral Sands Pte Ltd Singapore
("AMS") purchased a further tranche of Kazera's Ordinary shares
from an existing shareholder at 1.5p per share, triggering the
transfer of voting rights to AMS over 29.9% of the Company's
Ordinary Shares currently in issue
-- Pilot plant at Whale Head Minerals showing very promising
Heavy Mineral Sand ("HMS") results with sample and test results
forming the basis for informed strategic discussions with potential
offtake partners
-- HMS samples indicate presence of higher value minerals
including rutile, zircon, and monazite . Samples identified to have
raised levels of radioactivity and the Company has engaged with the
National Nuclear Regulator to determine whether any specific
permitting is required
-- Aggregate proceeds received to date of US$4.2 million f rom
Hebei Xinjian Construction ("Xinjian") in respect of the sale of
African Tantalum (Pty) Ltd in Namibia ("Aftan") , as announced on
22 December 2022 . The s ituation remains under review
-- Strengthened relationship and cooperation with Alexkor RMC JV
("Alexkor RMC JV"), a joint venture between Alexkor and the
Richtersveld Mining Company, a company formed to represent the
interests of Alexkor and the Richtersveld community
-- New heavy equipment on site at Deep Blue Minerals diamond
project , providing greater flexibility on mining locations
Dennis Edmonds, Kazera Chief Executive Officer, commented: " The
Company continues to make significant progress at both a corporate
and operational level. Of particular importance is the increased
cooperation and positive relationship between Kazera's subsidiaries
and Alexkor RMC JV , as we work together to create job
opportunities for the local Richtersveld Community.
"The completion of the acquisition of a further tranche of
Kazera shares by AMS is also a significant , positive development
for Kazera . AMS now holds voting rights through shares it has
acquired to date, and via agreements with Catalyse Capital Ltd and
its related parties, of more than 29.9% of the shares in the
Company. Kazera has already begun exploring potential new
investment opportunities put forward to the Company by AMS.
"Whilst the presence of radiation in HMS samples may be seen by
some as an issue, it is a situation that is not uncommon in the
Heavy Mineral Sands sector and has , equally importantly, helped
highlight the presence of higher value minerals in our HMS samples.
The detailed baseline study that has been conducted and other
associated work will allow us to seek clarification on permitting,
as well as tailor our operations and inform our approach to
environmental management and rehabilitation. Whilst on a basic
level any delay is frustrating, the testing and sampling work we
have undertaken has highlighted the economic case for separation as
it will ultimately result in the sale of higher value HMS
constituents, rather than a lower price for the basic HMS
product.
"We will ensure we use the time (whilst gaining clarification
from the relevant authority) to continue with the procurement of
equipment, site preparation and construction, and in progressing
discussions with potential offtake partners , so that we put
ourselves in the strongest possible position for the commencement
of HMS sales ."
New Strategic Shareholder
The Company was notified on 29 June 2023 that African Mineral
Sands Pte Ltd Singapore ("AMS") has completed the purchase of a
further tranche of shares from Catalyse Capital Ltd and its related
parties, including R S & C A Jennings and Align Research Ltd,
and that the completion of this tranche means that voting rights
over all shares still owned by Catalyse Capital Ltd and its related
parties have transferred to AMS.
As per the terms of the transaction referenced in the Company's
RNS dated 16 March 2023 , AMS is purchas ing up to 280 million
Ordinary Shares (representing up to 29.9 % o f the Ordinary Shares
currently in issue) in a series of tranches during 2023 at a price
of 1.5p per Ordinary Share.
The completion of this tranche of shares means AMS now owns
60,00,000 Ordinary Shares in the Company representing 6.4% of
Ordinary Shares in issue.
AMS and its associated partners have extensive experience in
mining and infrastructure projects in Southern Africa and the
Company believes the addition of AMS as a strategic investor is a
positive development, which will provide Kazera with new
opportunities for growth and development. AMS and its partners have
been investors and offtake partners in the HMS business over the
past five years.
Whale Head Minerals ("WHM") (60% interest) - Heavy Mineral
Sands
The Company continues to make good progress on the Heavy Mineral
Sands("HMS") project at Walviskop. The pilot plant, which
incorporates an HMS circuit and double decker Horizontal Vibrating
Screen, was installed in May 2023 and testing has revealed very
promising results which the Company has been continually including
in process alternatives, whilst also allowing the Company to
determine the exact make-up of its HMS and guide its initial
thinking on processing plant design.
Samples and test results from the pilot plant have also formed
the basis for informed strategic discussions with industry experts
and off-take partners on the short and long term potential of the
Company's HMS. From these discussions, initial findings suggest
that the Company's HMS has a heavy mineral content of approximately
62%, with around 55% of the resources classified as "saleable heavy
minerals". Indicative pricing for the basic (unseparated) product
is $160 per ton, but by undertaking further separation the price is
expected to be approximately double this whilst, importantly,
transport costs would remain at the same.
During the Company's testing, several samples were identified to
have raised levels of radioactivity resulting from the presence of
minerals such as rutile, zircon, and monazite, which typically have
a much higher commercial value than ilmenite. Whilst radioactivity
in HMS is not an uncommon occurrence, it does mean that the Company
has engaged with the National Nuclear Regulator ("NRR") to
determine whether any specific permitting is required prior to the
production and sale of the Company's HMS products.
To guide this discussion and any possible application for
exemption / additional permitting, a comprehensive baseline study
of radioactivity has been conducted across all areas of Walviskop,
including areas where the Company's HMS will be stored, processed,
and transported. In addition, a Workers Safety Report and Operating
Procedures are being compiled by a third party and should be
completed by mid-August 2023 at the latest.
If a permit is required, the application could take between
three and nine months whereupon the Company will immediately
commence production and sales of the higher value HMS products.
The Company is using this time to undertake more sampling to
confirm previous results and continue construction and area
preparation for both the plants in Walviskop Bay. This includes the
erection of a Trommel screening plant which is under construction
by a third party in South Africa and remains on track for
completion by the end of September 2023.
Further, the Company is in the process of creating drying,
bagging, and loading facilities within a secure area recently
supplied to the Company by Alexkor RMC JV. Alexkor RMC JV
recognises the value of the project in terms of opportunities for
the local community and the Company's increasingly positive and
collaborative relationship with Alexkor RMC JV has also resulted in
it being provid ed administration buildings, entrance /exit facilit
ies and a sheltered and secure workshop facility for the repair,
maintenance and storage of the Company's plant and machinery.
The provision of these secure sites and facilities will benefit
both the Company's HMS operation and diamond project and should
result in significant cost savings going forward.
Sale of Aftan
Under the terms of the agreement announced on 20 December 2022
in respect of the sale of the Company's interest in Aftan (the
"Agreement"), Xinjian was due to have paid US$3.0 million not later
than 31 January 2023 and a further US$3.1 million (excluding
interest) by the end of June 2023 (aggregate c.$6.1 million).
To date, Hebei Xinjian Construction ("Xinjian") has arranged
aggregate payments of US$4.2 million (including c.US$0.6 million
deemed to have been paid in respect of a Contribution and Exclusive
Marketing and Sales Agency Agreement).
Xinjian is currently not in compliance with the Agreement, with
payment arrears of c.US$1.9 million (excluding interest).
Nonetheless, at this time the Company has elected not to exercise
its contractual rights to terminate the contract given that:
-- Under the terms of the sale agreement with Xinjian, Kazera
retains ownership of 100% of the shares in Aftan as security until
all amounts owed by Xinjian have been paid in full.
-- All ongoing operation costs in respect of the Aftan business
have been borne by Xinjian since the beginning of 2023
-- Communication between Kazera and Xinjian remains positive and
constructive, with the Company believing that outstanding balances
will be forthcoming
-- Outstanding balances are accruing interest at a rate of 8% per annum.
Nonetheless, the Company is also exploring alternatives avenues
for the future of Aftan should Xinjian not be able to fulfil its
contractual obligations, including seeking an alternative
buyer.
Payments from Xinjian to date have been received, and are held
in, multiple currency denominations. In determining the amounts
stated as received, the Company has applied the exchange rate of
18.8275 being the NAD:USD exchange rate quoted as at 30 June 2023.
The weighted average exchange rate quoted for the period, was
17.6212. The exchange rate quoted on a given date is not usually
the actual exchange rate achieved.
Deep Blue Minerals (60% interest) - Diamonds
The Company has purchased new heavy plant, including a F ront -
end L oader and a 75 ton L ow-bed transporter, to allow the sharing
of equipment between Deep Blue Minerals' diamond project and Whale
Head Minerals' HMS project . Whist clarification is sought on the
next steps on its HMS project , this equipment will be used to
target areas which contain prospective high quantities of diamond
gravel.
Deep Blue Minerals will then bring in its 70 ton excavator to
remove overburden , which is several meters deep in places, and
move it on to do the same at the next site. A smaller excavator
will then follow to remove the gravels and place them in Deep Blue
Minerals ' screening proces s, which is now in operation, with
screened product then being subject to secondary screening at
Alexkor RMC JV' Muisvlak plant befo re going to the Final Sorting
Plant in Alexander Bay .
The Company believes that t his will create a very
cost-effective approach to focussing on potentially rich diamond
deposits which the Company anticipates will contribute
substantially to cashflow and cover operating costs of WHM.
In the meantime, diamond production continues from the existing
site and plant with processing of DMS concentrates being undertaken
a t Muisvlak , for final sorting at Alexkor. The most recent
Alexkor cycle close d on 4 July 2023 ; processed diamond stocks
will now be sold by Alexkor on open tender, on behalf of Deep Blue
Minerals , per Alexkor's usual process.
ENDS
For further information on the Company, visit: www. kazeraglobal
.com
Kazera Global plc (c/o St Brides) kazera@stbridespartners.co.uk
Dennis Edmonds (CEO)
finnCap (Nominated Adviser and Broker)
Christopher Raggett / Fergus Sullivan Tel: +44 (0)207 220 0500
(Corporate Finance)
St Brides (PR)
Paul Dulieu / Isabel de Salis / kazera@stbridespartners.co.uk
Susie Geliher
Notes
Kazera is a global investment company focused on developing
early-stage assets towards meaningful cashflow and production in
the resource sector. Its current assets include a diamond mine and
heavy mineral sands production in South Africa. The Company intends
to leverage its unique board expertise, investment capability and
operational proficiency, to facilitate exceptional cash generation
and shareholder growth.
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END
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