Last checked at 10 Feb 2021 07:00
Cadence Minerals Plc
("Cadence Minerals", "Cadence" or "the Company")
Update on the Amapa Iron Ore Project
Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to provide an update on its investment in the Amapa Iron Ore Project ("Amapa Project"), Brazil.
Settlement of Bank Creditors
In early September 2020, we announced that DEV Mineração S.A's ("DEV"), Cadence and Indo Sino Pty Ltd ("the Investors") agreed in principle to the settlement terms proposed by the secured bank creditors ("Bank Creditors"). Detailed discussions and drafting of the legal documents continue, and we look forward to updating the market once binding documents are executed.
The execution of a settlement agreement with the Bank Creditors would represent the satisfaction of Cadence's remaining major precondition to make its initial 20% investment in the Amapa Project. On completion of the conditions and the release of the Cadence escrow monies, Cadence will become a 20% shareholder in the Amapá Project via our joint venture company, which will own 99.9% of DEV.
Update on Court Petition to Commence Iron Ore Shipments
In April 2020 Commercial Court of São Paulo ("the Court") ruled that DEV., owner of the Amapa Project could commence the shipment of the iron ore stockpiles situated at DEV's wholly owned port in Santana, Amapa, Brazil.
After this and as announced in August and September 2020, the Bank Creditors filed and had an interim order approved by the State of São Paulo Upper Court ("Upper Court"). Yesterday the Upper Court rejected the Bank Creditors appeal ("the Ruling"), and once the Ruling is effective (up to one week from the date of publication), the interim order is annulled, and DEV's original petition is valid. This will allow the recommencement of port operations and the shipment of iron ore stockpiles.
Details of Approved DEV Court Petition
DEV is permitted to export sufficient iron ore to realise a US$10 million profit from the Amapa stockpiles at the port (after the deductions of all logistical, regulatory, shipping and sale costs).
The first portion of the net revenues shall be used to pay historic small and employee creditors (~US$2.5 million) after which approximately US$ 6 million of the net revenues will be used to begin recommissioning studies on the Amapa Project and to start maintenance and monitoring of the current tailing dam facilities. The remaining net revenues with be used to provide working capital for the operations and for a payment against the outstanding amount due to the Bank Creditors.
A certified translation of the Upper Court ruling is available here.
Further announcements will be made concerning both the Settlement Agreement and the outcomes from the Ruling once available.
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Qualified Person
Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.
Forward-Looking Statements:
Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identified by their use of terms and phrases such as ''believe'' ''could'' "should" ''envisage'' ''estimate'' ''intend'' ''may'' ''plan'' ''will'' or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth results of operations performance future capital and other expenditures (including the amount. nature and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors. Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions competition environmental and other regulatory changes actions by governmental authorities the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The Company cannot assure investors that actual results will be consistent with such forward-looking statements.