Phoenix Copper Limited Regulatory News (PXC)

Phoenix Copper Limited / Ticker: PXC / Sector: Mining

 24 March 2023

Phoenix Copper Limited

('Phoenix' or the 'Company')

Corporate Update 

Phoenix Copper Ltd (AIM: PXC, OTCQX: PXCLY), the AIM-quoted USA-focused base and precious metals emerging producer and exploration company is pleased to provide an update on recent corporate developments.

Corporate Copper Bonds

The Company is finalising discussions with a number of parties with a view to placing up to $80 million of corporate copper bonds, which were initially announced on 8 June 2022 (the "Bonds"). Recognising current market conditions, the coupon payable on the Bonds has been amended to the higher of a copper price coupon or an interest rate coupon.

The copper price coupon will be a minimum of 8.5% per annum at a $3.60 per pound ("/lb") or lower average monthly closing copper price during the relevant coupon period. Each $0.10/lb (or part thereof) increase in the copper price will increase the coupon by 0.15% (or part thereof), subject to a maximum of 20% per annum at a $11.27/lb or higher copper price. The interest rate coupon will be the average monthly closing Federal discount rate, plus 5%, subject to a minimum of 8.5% per annum and a maximum of 20% per annum.

Although the Directors remain confident the Bonds will be placed, the issue is not underwritten so there can be no certainty in this regard, or that the final terms agreed with investors will be consistent with those sumarised above.

Short-term Loan Facility

The Company has entered into a short-term $2,000,000 loan facility (the "Facility") with Riverfort Global Opportunities PCC Ltd (the "Lender") in order to strengthen US dollar operational working capital ahead of the 2023 exploration season, pending completion of the Bonds. The Facility is unsecured, has an initial three month term (the "Initial Term"), and pays a fixed 4% coupon.

The Company has the option to extend the Facility beyond the Initial Term for a further nine months, at 1% interest per month. If the Facility is extended, the Lender will be entitled to convert any principal or other amount outstanding into the Company's ordinary shares ("Ordinary Shares"), in one or more tranches, at a price equal to a 10% discount to the lowest VWAP in the ten days prior to conversion.

The Company will issue the Lender 2,000,000 warrants over Ordinary Shares, exercisable at 42p, and valid for three years.

The Company maintains sufficient sterling working capital to cover corporate overheads, well into 2024.

Annual Results for the Year Ended 31 December 2022

The audit for the year ended 31 December 2022 is progressing well and the Company expects to publish the 2022 audited Annual Report and Accounts towards the end of April, with a view to calling the 2023 Annual General Meeting during May.

ESG Update

The Company continues to strengthen its Environmental, Social & Governance ("ESG") credentials and is pleased to report that it has obtained an overarching score of 'A' on Digbee ESG, a disclosure platform for the mining industry that simplifies peer reporting and rewards management action. This report will shortly be available to view on the Company's website https://www.phoenixcopperlimited.com. The Company is also completing its inaugural ESG & Sustainability Report, summarising activities to date and setting out future goals up to, and following, production of copper and other metals from the Empire Open Pit Mine in Idaho, USA. This report is expected to be published during May.

Ryan McDermott, Chief Executive Officer, said, "These are exciting times for the Company, both at a corporate and an operational level. We are also looking forward to the upcoming 2023 exploration season, a primary focus of which will be a 60 hole drilling program at our Navarre Creek gold zone, which forms part of our expanded area of interest beyond the original Empire Mine claim blocks, as well as further drilling within those claim blocks themselves. I look forward to reporting on this exploration work in due course."

Environmental, Social, and Corporate Governance

Phoenix is committed to meeting and exceeding the environmental standards required by law as a core value of the Company. The baseline environmental data collected to date will be used for furthering the permitting process, but as importantly, will be used as the building blocks for the Company's ongoing Environmental, Social, and Corporate Governance (ESG) platform, overseen by the Company's ESG & Sustainability Committee.

Market Abuse Regulation (MAR) Disclosure

The Company deems the information contained within this announcement to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014, which has been incorporated into UK law by the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.

Contacts

For further information please visit https://phoenixcopperlimited.com or contact:

Notes

Phoenix Copper Limited is a USA focused, base and precious metals emerging producer and exploration company, initially targeting copper and zinc production from an open pit mine.

Phoenix's primary operations are focused near Mackay, Idaho in the Alder Creek mining district, at the 80% owned Empire Mine property, which historically produced copper at grades of up to 8%, as well as gold, silver, zinc and tungsten, from an underground mine.

Since 2017, Phoenix has carried out extensive drill programs which have defined a NI 43-101 completed PEA (preliminary economic assessment) for an open pit heap leach solvent extraction and electrowinning ("SX-EW") mine, which was updated in October 2020. From the 2020 PEA, the measured and indicated resource is: 22,909,059 tonnes at an average grade of 0.38% copper, 0.324 grammes per tonnes ("g/t") gold, 10.3 g/t silver, and 0.19% zinc. The contained metal for the measured and indicated resource is 87,543 tonnes of copper, 238,406 ounces of gold, 7,595,198 ounces of silver and 43,871 tonnes of zinc. Phoenix updated its economic model in February 2021 to include the processing of all contained metals through a two phased approach.

In addition to Empire, the district includes the historic Horseshoe, White Knob and Blue Bird Mines, past producers of copper, gold, silver, zinc, lead and tungsten from underground mines. A new discovery at Red Star, 330 metres northwest of the Empire Mine proposed open pit, has revealed high grade silver / lead sulphide ore, and from three shallow exploration drill holes a maiden inferred resource of 103,000 tonnes containing 173.4 g/t silver, 0.85 g/t gold and 3.85% lead (1.6 million ounces silver equivalent) was reported in an NI 43-101 technical report published in May 2019. Additionally, the district includes Navarre Creek, a volcanic hosted precious metals target in a 14.48 sq km area. The Company's total land package at Empire comprises 8,034 acres (32.51 sq kms).

At Empire, it is estimated that less than 1% of the potential ore system has been explored to date and, accordingly, there is significant opportunity to increase the resource through phased exploration. The stated aim of the Company is to fund this phased exploration through free cashflow generated by its initial mine. A Plan of Operations in respect of the initial open pit mine was filed with the relevant regulatory authorities in June 2021.

Phoenix also has two wholly owned cobalt properties on the Idaho Cobalt Belt to the north of Empire. An Earn-In Agreement has been signed with Electra Battery Materials, Toronto, in respect of one of those properties.

Phoenix is listed on London's AIM (PXC), and trades on New York's OTCQX Market (PXCLF and PXCLY (ADRs)). More details on the Company, its assets and its objectives can be found on PXC's website at https://phoenixcopperlimited.com/