Clontarf Regulatory News (CLON)

Clontarf Energy PLC Bolivia Lithium Update

RNS Regulatory News

Clontarf Energy PLC

6th June 2024

Clontarf Energy plc

("Clontarf" or the "Company")

Bolivia Lithium Update

3rd Phase of the 2024 evaporites Convocatoria

Clontarf Energy plc (AIM: CLON), wishes to report the following update:

Further to the Company's 6th, 18th March, and 15th May 2024 announcements, the Bolivian State Lithium Company ("YLB") received Clontarf's financial materials in relation to Phase 3 of the Call for Bids ("convocatoria") for the seven priority salares (salt pans) in Southern Bolivia. 

Since Clontarf is an exploration company, and does not issue bonds, it does not have a credit rating and accordingly could not provide an 'A3' or 'A-' rating, as requested in the 2024 convocatoria tender documents. Neither could Clontarf's technology partner, since it is an R+D company, also without property or fixed assets in secure jurisdictions.

Accordingly, Clontarf identified an offtake partner, at the encouragement of the EU Commission, which has substantial revenues, profits and bank lines, as well as an 'A2' short-term credit rating. All requested documents were submitted by the deadlines, both physically and in digital form.

Unfortunately, the authorities appear to have declined the 'A2' short-term credit rating, possibly because the long-term credit rating (BBB+) was marginally below the requested 'A3'. This means that Clontarf hasn't passed through to the fourth stage of the convocatoria.

This regrettable outcome may not be well-grounded in policy or logic: Clontarf and its partners had undertaken to provide 100% of project capital, both from equity markets and appropriate infrastructural funds, to be channelled via the national borrowers. Accordingly, there seemed little logic for bonds, bank guarantees or ratings. Clontarf made these points both directly, and via EU entities. We continue to argue this case and are optimistic that, with proof of technology and confirmation of EU financial support, that this subject may be revisited whether in this or a future bid round, or direct negotiations.

Further updates will be provided, as appropriate, in accordance with necessary clearances from the authorities.

● David Horgan, Chairman, commented: " Europe and the world need offtake of pure Bolivian Lithium.  Europe's supplies of Critical Minerals are vulnerable - especially in Lithium, Cobalt and Rare Earths. China's strategy to dominate Critical Minerals' processing, & mining has succeeded unopposed for 25 years. This now extends into EVs."

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"In their first 2021 convocatoria, Bolivia awarded convenios to 2 Chinese and one Russian State-backed companies. Nonetheless, no battery-grade Lithium has yet been exported by any of these operators. That is why YLB embarked on another 2024 convocatoria".

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""We need a "Team Europe" effort - as no one company or country can grapple with China and NAFTA. We need to combine operating skills, clean technology, with distribution & financing - including bank support - competing in all links of the value chain."

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"Finance is best linked to offtake. Many supplier states have insufficient financial standing to constitute reliable counter-parties."

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"But market fundamentals for long-term offtake contracts are excellent: Demand for Lithium carbonate equivalent grew 30% to circa 930k tonnes in 2023. Few commodities or specialty chemicals exhibit such growth. New projects will struggle to deliver the supply needed."

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"The Bolivian 2024 convocatoria is a process that will allow several companies to prove their technologies. It was not a conventional bid round, in which there is usually one winner. The ultimate winners will be all those whose solutions work technically and commercially."

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"Clontarf Energy's technology partners are now assembling a pilot-plant at a trusted facility in India. We plan to process test volumes of brines at this facility. If plant performance confirms laboratory results this will help Clontarf drive forward with this important project".

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.

ENDS

For further information please visit http://clontarfenergy.com or contact: