6 Apr 2018 16:00
BMR Group PLC ("BMR", the "Group" or the "Company")
Restoration of Kabwe Mining Right
This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.
BMR announces that, further to its earlier announcement on 5 April 2018, the Small Scale Mining Licence 7081-HQ-SML (the "Kabwe Licence") has been re-instated with immediate effect to BMR's wholly owned subsidiary Enviro Processing Limited ("EPL") by letter from the Ministry of Mines and Minerals Development dated 3 April 2018, which was confirmed by BMR's legal advisers in Zambia on 4 April 2018 as a valid and binding re-instatement of BMR's title to the Kabwe Licence.
Following re-instatement, the Kabwe Licence includes new conditions on BMR including (i) plant construction commencing within three months of 3 April 2018; (ii) completing plant construction and commissioning by 30 September 2018; and (iii) commencing production by 30 December 2018. In addition, the Company is to submit a detailed employment and training plan; contribute to the Environmental Protection Fund in accordance with the Environmental Management Act, No. 12 of 2011; and comply with the Mines and Minerals Development Act 2015 and other relevant laws of Zambia.
In relation to the Environmental Management Act, No. 12 of 2011, BMR has now established that EPL is required to ensure that, following the reclamation and processing of the Kabwe tailings, the land is rehabilitated to an acceptable alternative future land use form, with appropriate decommissioning of the plant. In accordance with the Mines and Minerals Development Act 2015, EPL is required to (i) deposit 20 per cent. of the estimated final closure cost of approximately US$1.2 million into the Environmental Protection Fund in five equal annual instalments, commencing this year, of approximately US$48,000 each and (ii) put in place a bank guarantee for the life of the Kabwe Licence covering the balance of the estimated final closure cost, ie approximately US$ 960,000.
In light of the re-instatement of the Kabwe Licence, the Directors anticipate announcing shortly a subscription of £1.0 million for 33,333,333 new ordinary shares at 3 pence per share together with warrants over a further 33,333,333 new ordinary shares exercisable at 5 pence per share for six months thereafter, whereupon BMR will apply for trading in its shares on AIM to be restored. The Directors intend that these subscription proceeds will be used primarily for working capital purposes.
The Directors also anticipate that BMR and Jubilee Metals Group PLC will shortly formalise their joint venture and operating agreement, as announced on 23 October 2017.
Alex Borrelli, Chairman of BMR, stated: "The return of the licence was fully expected by BMR and vindicates the actions taken by the Directors. We are now working closely with Jubilee Metals Group to make up for lost time and wholly expect to meet the conditions set out by the Ministry of Mines and Minerals Development, particularly as plant construction has already commenced."
For further information:
BMR Group PLC 020 7734 7282
Alex Borrelli, CEO and Chairman
WH Ireland Limited (NOMAD and Joint Broker) 020 7220 1666
Chris Fielding, Managing Director, Corporate Finance
Alex Bond, Executive
Peterhouse Corporate Finance (Joint Broker) 020 7469 0930
Lucy Williams