REG - Harvest Minerals Ltd - Acquisition of Advanced Stage Phosphate Project

Harvest MineralsAnnouncement

29/11/2021 07:00

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RNS Number : 7971T  Harvest Minerals Limited  29 November 2021

Harvest Minerals Limited / Index: LSE / Epic: HMI / Sector: Mining

29 November 2021

Harvest Minerals Limited ('Harvest' or the 'Company')

 

Acquisition of Advanced Stage Phosphate Project

 

Harvest Minerals Limited, the AIM listed remineraliser producer, is pleased to
announce that it has entered into a binding share purchase agreement to
acquire the entire issued share capital of BF Mineração Ltda ('BF
Mineração') for a total consideration of US$800,000 payable in cash and new
Harvest shares over a period of time (the 'Agreement'). BF Mineração owns
the advanced Miriri Phosphate Project (the 'Project') in the State of
Pernambuco, Brazil, which will complement the Company's existing Arapua
Fertiliser Project ('Arapua') and expand its profile into the Northeast region
of Brazil.

 

Overview

·    Project comprised of seven mineral rights spanning a total area of
6,112 hectares in a predominantly agricultural state in Brazil with excellent
infrastructure in place

·    Developed to date by the Brazilian Geological Agency, CPRM, which has
executed substantial exploration work

·    CPRM estimated historical non-NI 43-101 inferred resources of 4.8
million tonnes at 4.19% P(2)O(5)

·    Planned development strategy includes the certification of an
international standard resource and commissioning a Preliminary Feasibility
Study ('PFS'), which the Company is fully funded for, and then, subject to
funding, fast-tracking the Project to production

 

Brian McMaster, Chairman of Harvest, said: "We are excited to be expanding our
activities to other agricultural regions of Brazil and leveraging our in-house
experience on direct shipping ore project implementation.  Given the
substantial work already completed, we are confident that we can replicate the
success seen at Arapua and fast-track the Project to production. Notably, as a
simple Direct Application Natural Fertiliser operation, the Project also ticks
the sustainable box, which is key given the growing demand for organic crop
farming and increased focus on providing an all-natural solution to boost soil
nutrition. We look forward to updating the market on the next steps of this
value accretive acquisition and subsequent developments."

 

Details

As part of its strategy to build its position as a producer of natural
fertilisers in Brazil, Harvest is acquiring BF Mineração, a privately held
company, which owns the option to acquire 100% of the Miriri Phosphate Project
from a group of Brazilian individuals (the "Vendors").  BF Mineração is
100% owned by Luis Azevedo, a director of the Company, which, for structuring
reasons, has purchased the option on behalf of the Company from the Vendors.
Mr Azevedo is receiving no separate consideration from Harvest for
facilitating this acquisition structuring.

 

The Company believes the Project is amenable for the fast-track development of
a Direct Application Natural Fertiliser ("DANF") operation at low capex and
opex similar to its producing Arapua Project.  Comprised of seven mineral
rights for a total area of 6,112 hectares and with excellent infrastructure in
place, the Project has been developed to date by the Brazilian Geological
Agency CPRM (Companhia de Pesquisa de Recursos Minerais), which executed
substantial exploration work including 176 drill holes totalling 6,890 meters,
aerial geophysics, and ground geochemistry.

 

While the Project has an estimated historical non-NI 43-101 inferred resources
of 4.8 million tonnes at 4.19% P(2)O(5), Harvest, through an independent
Qualified Person, aims to undertake the certification of the resources under
international standards and commission a PFS.  It is anticipated that the ore
will be processed through simple mining, crushing, and screening separation to
deliver a widely sellable fertiliser product without the need of costly and
capex intensive flotation and/or further beneficiation.

 

The terms of the Transaction, which will see Harvest take 100% ownership of BF
Mineração and in turn exercise the option to acquire 100% of the Project,
include:

·    The entire share capital of BF Mineração shall be assigned to
Harvest upon the payment to BF Mineração of US$100,000 in cash, plus the
issue of the equivalent of US$200,000 in new ordinary shares in the capital of
Harvest ("Ordinary Shares") at a price of £0.045 pence (being approximately
the current share price), equating the issue of 3,333,333 new Ordinary Shares
in Harvest;

o  The full amount of cash and new Ordinary Shares received by BF Mineração
will be distributed to the Vendors immediately following receipt, and the
option to purchase 100% of the Project exercised.

·    Within two years of the delivery of a NI 43-101 Resource or PFS for
the Project, Harvest shall issue to the Vendors the equivalent of US$250,000
in new Ordinary Shares, calculated on a 10-day VWAP basis; and

·    Following the first sales of product from the Project, Harvest shall
pay US$250,000 in cash to the Vendors.

 

BF Mineração was incorporated for the purpose of the Transaction, and its
sole asset is the option to acquire the Project. Accordingly, it does not have
a trading history.

 

Related Party Transaction

Entering into the Agreement constitutes a related party transaction under Rule
13 of AIM Rules. In this context, Brian McMaster, Jack James, and Alex Penha
(being the Directors on the Board who are considered to be independent of BF
Mineração) consider, having consulted with the Company's nominated adviser,
Strand Hanson Limited, that the terms of the Agreement are fair and reasonable
insofar as its shareholders are concerned.

 

Admission to Trading and Total Voting Rights

The 3,333,333 new Ordinary Shares issued rank pari passu with the Company's
existing Ordinary Shares.  Application has been made for these new Ordinary
Shares to be admitted to trading on AIM ('Admission').  It is expected that
Admission will become effective and dealings in these new Ordinary Shares will
commence on or around 1 December 2021.

 

Following the issue of these new Ordinary Shares, the total issued share
capital of the Company consists of 189,169,217 Ordinary Shares with voting
rights. The Company does not hold any Ordinary Shares in treasury. Therefore,
the total number of voting rights in the Company is 189,169,217 and 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 under the FCA's Disclosure and Transparency Rules.

 

Click on or paste the following link into your website browser to view the
associated PDF document (including map):
http://www.rns-pdf.londonstockexchange.com/rns/7971T_1-2021-11-27.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/7971T_1-2021-11-27.pdf)

 

**ENDS**

 

For further information, please visit www.harvestminerals.net
(http://www.harvestminerals.net/)  or contact:

 

 Harvest Minerals Limited            Brian McMaster       Tel: +44 (0)20 3940 6625

                                     Chairman

 Strand Hanson Limited               Ritchie Balmer       Tel: +44 (0)20 7409 3494

 Nominated & Financial Adviser       James Spinney

                                     Abigail Wennington

 Shard Capital Partners              Damon Heath          Tel: +44 (0)20 7186 9900

 Broker

 St Brides Partners Ltd              Isabel de Salis      E: harvest@stbridespartners.co.uk

 Financial PR                        Oonagh Reidy

 

 

 

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