Corcel Regulatory News (CRCL)

Corcel PLC

("Corcel" or the "Company")

Proposed Battery Metals Joint Venture, New Cornerstone Investor, Placing, and TVR

17 October 2022

Corcel, the natural resource exploration and development company with interests in battery metals and flexible energy generation and storage announces it has entered into a memorandum of understanding ("MOU") for the reorganization of the Company's battery metal mining interests in PNG into a new carried battery metal led Asian joint venture ("JV") structure alongside the introduction of a new cornerstone investor through an equity placing.

MOU Highlights:

o  Intended creation of a Singapore based upstream Battery Metal joint venture which will, subject to contract, own CRCL's position in the Mambare and Wowo Gap projects alongside the Doncella lithium project in Argentina

o  Corcel intends to own 50% of the proposed JV, benefit from a $1.5m carried interest and a 1.5% gross revenue royalty on Wowo Gap and nominate half of the Board of the JV - It is the intention of the parties to list the JV in Singapore in the medium term

o  Introduction of a new cornerstone investor with Corcel plc Board representation as part of a fundraising of £200,000 at a price of £0.004 (no discount to the closing price) with 1 for 1 warrants exercisable at £0.005 per share

James Parsons, Executive Chairman, commented: "I am delighted to welcome Mr Yan Zhao to the Board and to the shareholder register. We believe this proposed PNG restructuring, with its associated carry, and an ultimate Singapore listing, is the best way to bulk up and ultimately unlock the significant value in our battery metals portfolio."

Battery Metals Interest Restructuring and Joint Venture

Further to the previously announced offtake discussions with Shandong New Powder COSMO AM&T ("NPC"), Corcel and NPC have signed an MOU to form a new joint venture company, Integrated Battery Metals ("IBM") in Singapore, in order to pursue an Asian focused battery metals strategy with direct links to offtake partners and end users of these critical battery metals. It is both parties view that Singapore is the ideal listing forum for this expanded battery metals portfolio.

o  Corcel has agreed, subject to contract, to inject its 41% interest in the Mambare nickel/cobalt project as well as its 100% interest in Wowo Gap nickel/cobalt projects, and NPC has agreed to inject its 4.48% interest in Hanacolla S.A., owner of the Doncella lithium project in Argentina, with additional lithium and other battery metal interests expected to follow. The 4.48% interest in Hanocolla has been recently externally valued at $4.1M by reference to a funding for 10% of Hanocalla valuing the business at $92m. In addition to its 50% stake in IBM, Corcel will receive a carry of up to two years or the award of a mining lease at Wowo Gap capped at $1.5m. Corcel will also receive a 1.5% gross revenue royalty over the Wowo Gap project.

NPC and CRCL intend to operate IBM via a standard joint venture structure with CRCL receiving 50% board representation, and NPC and CRCL have agreed to seek to list IBM in Singapore. It is expected that use of the IBM structure will allow access to the industrial led capital required to take all of IBM's battery metal interests forward through feasibility and ultimately into production and offtake.

Signature of the transaction is expected to occur in the coming weeks with completion of this transaction being conditional on CRCL's Mambare partner's pre-emption rights being waved, as well as the relevant administrative approvals required by the PNG government to complete the required asset transfers.

Doncella Lithium Project

The Doncella lithium project is Hanacolla's flagship project located in the Arizaro Salar, in the Salta province of NW Argentina; approximately 170km from Salta. The project consists of 725km2 of lithium salt brine style mineral tenements located within the Salar de Arizaro Basin. Arizaro is the largest salar in Argentina and one of the most important in Puna Region. The Puna constitutes the southern end of the high platform of the Central Andes, better known on a continental scale as the Altiplano, which develops closely related to the Cenozoic volcanic arc.

Salta is considered a prospective area within the "Lithium Triangle" according to the Fraser Institute. The "Lithium Triangle" is the stylized name from a geographic region circumscribed to the S. American meso-Andean plateau, on which three countries simultaneously have territory: Argentina, Bolivia and Chile, and owes its name to the lithium available in lithium brine-based deposits.

The Doncella project is a lithium in brine deposit. This type of project is characterized by being located in structural lows that form restricted basins that are mainly filled with halite, clay, silt, sand and gravel. Lithium rich brine is lodged in the pores of the deposited sediments. As the lithium remains dissolved in fluid form, it has the ability to move and mix with other adjacent fluids once extraction has begun. Exploration is focussed on developing lithium resources by gaining better understanding of the aquifers and the variations of the porosity and grades within them. As conducted by the previous owners to date, a total of 112 trench samples and 35 drill samples have been collected and have yielded lithium values between 100 and 247ppm, the average being between 150 and 160ppm. 

Additionally, the General Belgrano railway between Salta and Antofagasta port passes over the Arizaro Salar very close to Hanacolla's tenements, offering favourable logistics supporting future exploitation and development. Hanacolla recently raised $9.2m in new equity valuing the entirety of the business at $92m and funding the ongoing exploration and development programme. 

Equity Raise:

The fundraising has raised gross proceeds of £200,000 from the issue of 50,000,000 new ordinary shares of £0.0001 (Ordinary Shares) at £0.004 (the "Placing Price") per share ("Placing Shares") to Shangdong New Power COSMO AM&T ("NPC").

The Company has also issued the equity investor with one warrant for every one share exerciseable at £0.005 per new warrant share at any time over the next year ("Warrants"). 

Upon completion of the fundraising, NPC will have the right to nominate a Non-Executive Director, Mr. Yan Zhao, to the Board of the Company, subject to director background checks.

The Company intends to use the funds from this placing for working capital purposes and to fund the costs associated with potential acquisitions including origination, due diligence and advisors fees.

Total Voting Rights:

Application will be made for the 50,000,000 Initial Investment to be admitted to trading on AIM and it is expected that their admission to AIM will take place on or around 21 October 2022 (" Admission"). 

Following Admission, the Company's total issued share capital will consist of 580,208,295 Ordinary Shares, with one voting right per share. The Company does not hold any shares in treasury. Therefore, the total number of Ordinary Shares and voting rights in the Company will be 580,208,295 from Admission. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company pursuant to the FCA's Disclosure Guidance and Transparency Rules.

For further information, please contact:

Scott Kaintz 020 7747 9960 Corcel Plc CEO 

James Joyce / Andrew de Andrade 0207 220 1666 WH Ireland Ltd NOMAD & Broker

Simon Woods 0207 3900 230 Vigo Communications IR 

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.