REG - Europa Metals Ltd - Corporate & Operational Update

Europa MetalsAnnouncement

26/01/2022 07:05

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RNS Number : 6239Z  Europa Metals Ltd  26 January 2022

26 January 2022

Europa Metals Ltd

("Europa Metals", the "Company" or the "Group") (AIM, AltX: EUZ)

Corporate & Operational Update

Europa Metals, the European focused lead, zinc and silver developer, is
pleased to provide a corporate and operational update further to the cost and
strategic review announced on 18 November 2021 and including details of the
planned work during the first half of 2022 at the Company's wholly owned Toral
lead, zinc and silver project in the Castilla y León region, Spain ("Toral"
or the "Toral Project").

Corporate

Further to the Board's comprehensive internal review process, the Company is
implementing a cost reduction strategy in order to maximise the deployment of
existing cash resources on both the Toral Project and the identification and
assessment of potential new projects and opportunities for the Company.

Accordingly, pursuant to the cost reduction programme, with effect from 1
January 2022 three of the Company's existing directors (being Messrs Read,
Campion and Kirby) (together, the "Participating Directors") have agreed to
the deferral/accrual of 50 per cent. of their director remuneration
(comprising consulting fees and/or salaries) in respect of the 2022 calendar
year, with such accrued remuneration to then be settled via the issue of new
ordinary shares in the capital of the Company ("Ordinary Shares") (the
"Proposed Fee Deferral and Conversion").

Under the terms of the Proposed Fee Deferral and Conversion, the following
mechanism is to be used to determine the quantum of shares to be issued to the
Participating Directors in lieu of the cash remuneration to which they would
otherwise have been entitled:

-    50 per cent. of each individual Participating Director's fees/salary
will accrue from 1 January 2022;

-    Accrued fees/salaries will be converted into new Ordinary Shares, with
accruals for the period from 1 January 2022 to 30 June 2022 expected to be
converted and the requisite shares issued in July 2022, and accruals for the
period from 1 July 2022 to 31 December 2022 expected to be converted and the
requisite shares issued in January 2023; and

-    The total number of new Ordinary Shares to be issued and allotted in
July 2022 and January 2023 in settlement of the monthly amounts accrued is to
be determined by applying the relevant monthly volume weighted average price
("VWAP") for the Company's Ordinary Shares on AIM and relevant month end
AUD:GBP exchange rate, as applicable.

The proposed issue of Ordinary Shares to the Participating Directors pursuant
to the terms of the Proposed Fee Deferral and Conversion, as detailed above,
is deemed to constitute a related party transaction pursuant to Rule 13 of the
AIM Rules for Companies. Accordingly, the Company's independent director for
the purposes of such share issues, being Daniel Smith (who is not
participating), having consulted with the Company's Nominated Adviser, Strand
Hanson Limited, considers that the terms of the proposed share issues to the
Participating Directors under the Proposed Fee Deferral and Conversion are
fair and reasonable insofar as the Company's shareholders are concerned.

 

Certain additional cost reductions have been identified and implemented at the
Group level with further cost savings intended to be rolled out over the
coming months.

 

Whilst the Toral Project is already at an advanced stage, the Company is
initiating a further series of work programmes, including additional
geotechnical and resource drilling, in order to continue to de-risk it. As
announced previously, a transaction review team has also been established to
assess a series of potential new projects and opportunities, primarily in the
precious metals and energy sectors, in order to determine whether deployment
of our exploration expertise on new assets could potentially generate
significant additional value for shareholders.

Operational

Ore sorting testwork is now underway by TOMRA, a leading provider of ore
sorting technology based in Germany, which is being overseen by Wardell
Armstrong International Ltd, Cornwall ("WAI"). The ore being sorted is from
the upper zone material retrieved from the Company's 2021 drilling campaign,
which included four successful daughter holes, in order to assess and
determine the maximum efficiencies for recovery and concentrate processing in
the early years of the future Toral production profile. Following completion
of the testwork, waste testing will commence to investigate the suitability of
potentially implementing a low water, dry stack tailings model that can
backfill into the future mined areas of Toral and utilise surrounding, disused
quarry sites, as part of a reclamation strategy being developed with local
stakeholders.

A further limited geotechnical and resource drilling programme is also planned
to commence during the current quarter. Geotechnical drilling and studies will
initially serve to determine ground conditions at several potential plant
sites, whilst ground assessment work has begun at a disused quarry site
identified for potential reclamation. Resource drilling will then seek to
incrementally expand the Company's pre-existing 5.9 million tonne Indicated
resource estimate.

 

 

Commenting today, Laurence Read, CEO of Europa Metals, said:

"At the start of 2022 our clear focus is on delivering shareholder value by
continuing to advance Toral in a cost-effective manner and delivering on a
work programme designed to further de-risk the project and maximise the
efficiency of the proposed early years' production profile.

"Our cost-cutting programme aims to ensure that our resources are directed as
far as possible on project related expenditure and existing operations, as
well as the evaluation of potential new complimentary projects and
opportunities.

"We have a valuable asset in Toral which the Board does not currently believe
to be fully recognised and reflected in the Company's share price and by
seeking to identify and secure a potential new attractive project(s) to add to
our portfolio we will endeavour to add value for shareholders whilst
continuing to drive Toral forward."

 

For further information on the Company, please visit:

www.europametals.com (http://www.europametals.com)

Linkedin:          Europa Metals ltd

Twitter:            @ltdeuropa

Vox:                 Europametals

or contact:

 

Europa Metals Ltd

Dan Smith, Non-Executive Director and Company Secretary (Australia)

T: +61 417 978 955

Laurence Read, CEO (UK)

info@europametals.com

 

Strand Hanson Limited (Nominated Adviser)

Rory Murphy/Matthew Chandler

T: +44 (0)20 7409 3494

WH Ireland Limited (Joint Broker)

Harry Ansell/Dan Bristowe/Katy Mitchell/Sarah Mather

T: +44 (0)20 7220 1666

Turner Pope Investments (TPI) Limited (Joint Broker)

Andy Thacker/James Pope

T: +44 (0)20 3657 0050

 

Questco Corporate Advisory Proprietary Limited (JSE Sponsor)

Sharon Owens

T: +27 (11) 011 9212

 

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended.

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