REG - Gunsynd PLC - Conditional Farm-in to Black Schist Projects

GunsyndAnnouncement

21/06/2022 07:00

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RNS Number : 5536P  Gunsynd PLC  21 June 2022

Gunsynd Plc

("Gunsynd" or the "Company")

Conditional Farm-in to Black Schist Projects in Finland

Nickel-Zinc-Copper-Cobalt Deposit Proximal to Large Talvivaara Mine

Gunsynd (AIM: GUN; AQSE: GUN) is pleased to announce it has agreed binding
heads of terms with Metals One Plc ("Metals One") to farm into the Black
Schist Projects in Finland (the "Projects"), containing a
nickel-zinc-copper-cobalt deposit proximal, and analogous, to the large
Talvivaara mine.

Gunsynd has agreed to provide funding to Metals One of £1 million for the
development of the Project (the "Investment"), for which it will be issued
such number of shares in the capital of Finnaust Mining Northern OY
("Finnaust", which holds the Projects), which equal 25% of the voting rights
in Finnaust (the "Farm-in").

The Investment is conditional upon Metals One's ordinary shares being admitted
to trading on the AIM market of the London Stock Exchange ("Admission") and
simultaneous acquisition of Finnaust. Gunsynd will provide the £1 million
funding and receive the 25% of Finnaust over a period of 18 months in four
equal tranches, beginning on Metals One's Admission and thereafter at
six-monthly intervals, to be invested in the development of the Projects.

Black Schist Projects - Finland

The Projects are located in the Kainuu Schist Belt of eastern Finland and
contain existing inferred resources of 28.1 Mt nickel-zinc-copper-cobalt
(Ni-Zn-Cu-Co). The deposit is analogous to the nearby Talvivaara Ni-Zn-Cu-Co
deposit, one of the largest nickel mines in Europe, which has a supply
agreement with Renault Group.

 

The Projects total 7km(2) and comprise three permit applications:

·    Paltamo - contains a JORC exploration target of 16-24 Mt of
Talvivaara type ore containing 0.18-0.27% Ni, 0.09-0.13% Cu, 0.01-0.02% Co and
0.33-0.50% Zn has been estimated

 

·    Rautavaara S - contains a JORC (2012) inferred mineral resource of
28.1 Mt of Talvivaara type ore at a grade of 0.19% Ni (53,800t), 0.10% Cu
(27,900t), 0.01% Co (3,400t) and 0.38% Zn (180,000t)

 

·    Rauta 9-11 - application to extend the permit

 

Metals One believes there is a compelling case for further exploration for
Talvivaara-style Ni-Zn-Co-Cu deposits. Conditional upon Admission, Metals One
has scoped out an intensive 18-month work programme targeting resource
expansion, beginning in or around Q3 2022, which will be part-funded by the
Investment. The programme will include geophysical and geochemical surveys to
expand the geological knowledge and confirm targets for approximately 9,000
metres of diamond drilling estimated to begin later this year.

 

The Projects benefit from historical geophysical, geological, and geochemical
data covering large areas of the belt as well as historical geophysical
surveys and diamond drilling.

 

Like the nearby Talvivaara mine, the Projects' northern European location is
exceptionally well suited to supplying battery metals to Europe's electric
vehicle and battery manufacturing plants which are seeking to secure local
supply chains and minimise the carbon footprint of input materials.

 

In the six months ended 31 December 2021, Finnaust had turnover of nil and
made a profit for the period of £85.

 

Warrants and Board Representation

 

In addition to Gunsynd's 25 percent interest in Finnaust, the Company will
receive warrants to subscribe for ordinary shares in Metals One valued at
£75,000 at the Admission price of Metals One's ordinary shares.

 

Following settlement of the first Farm-in instalment, Gunsynd will have the
right to appoint a director to the board of Finnaust.

 

Hamish Harris, Chairman of Gunsynd, commented:

"The Black Schist Projects in Finland fit exceptionally well within the mining
segment of our investing strategy. The Projects are underpinned by existing
resources with significant exploration upside potential, reside within a
stable jurisdiction, are well-supported by infrastructure, and are proximal,
and analogous, to the giant Talvivaara mine which was profitable in 2018 and
2019 when nickel prices were significantly lower than they are today.

Battery metals are critical to decarbonisation and are facing significant
supply deficits. Europe is experiencing significant growth in demand for
electric vehicles and its manufacturers need to secure reliable supply chains
of battery metals such as nickel. Their northern European location makes the
Projects ideally located to supplying battery metals into this market.

We believe we are investing in the Projects at a hugely strategic and
advantageous time, ahead of an intensive 18-month exploration programme to
which our investment will be applied, and with market dynamics pointing to a
continued upward trend in the prices of battery metals. We have a track record
of investing in early stage nickel projects, with another of our investments -
Pacific Nickel Mines Limited - having earlier this month awarded an offtake
and project debt mandate to Glencore. We believe the Black Schist Projects
hold similarly exciting potential."

This announcement contains inside information for the purposes of the UK
Market Abuse Regulation.

Forward Looking Statements

This announcement contains forward-looking statements relating to expected or
anticipated future events and anticipated results that are forward-looking in
nature and, as a result, are subject to certain risks and uncertainties, such
as general economic, market and business conditions, competition for qualified
staff, the regulatory process and actions, technical issues, new legislation,
uncertainties resulting from potential delays or changes in plans,
uncertainties resulting from working in a new political jurisdiction,
uncertainties regarding the results of exploration, uncertainties regarding
the timing and granting of prospecting rights, uncertainties regarding the
Company's ability to execute and implement future plans, and the occurrence of
unexpected events.  Actual results achieved may vary from the information
provided herein as a result of numerous known and unknown risks and
uncertainties and other factors.

The Directors of Gunsynd accept responsibility for this announcement.

 

 

For further information please contact:

 

 Gunsynd plc

 Hamish Harris/ Peter Ruse                    +44 (0)7879 584 153

  www.gunsynd.com (http://www.gunsynd.com)
 Cairn Financial Advisers LLP

 James Caithie / Liam Murray                  +44 (0)20 7213 0880

 Peterhouse Capital Limited

 Lucy Williams                                +44 (0)20 7469 0936

 

 

 

 

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