REG - Ironveld PLC - Ironveld PLC Signs Mining Operations Agreement

IronveldAnnouncement

07/10/2025 07:10

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RNS Number : 3547C  Ironveld PLC  07 October 2025

The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (Withdrawal) Act 2018. The information is
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UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.

7 October 2025

Ironveld PLC

("Ironveld" or the "Company")

Ironveld PLC Signs Mining Operations Agreement

Agreement provides for a GBP 21.6 million capital and operational expenditure
commitment, removing Ironveld's mining cost exposure and establishing new
ROM-related revenue streams.

Ironveld PLC (AIM: IRON) is pleased to announce that its 74%-owned subsidiary,
Lapon Mining (Pty) Ltd ("Lapon Mining"), has entered into a binding Mining
Operations Agreement with Daemaneng Minerals (Pty) Ltd ("Daemaneng" or the
"Contractor") through which Daemaneng will assume full responsibility for all
mining operations, including all capital and operational expenditure, at the
Lapon site over a five year period.

Under the Agreement, Daemaneng will assume full responsibility for all mining
operations at the Lapon site - including all capital investment, operating
costs, logistics, labour, compliance, and the establishment of on-site
processing infrastructure - thereby eliminating any future mining-related
expenditure for Lapon Mining.

The arrangement effectively transfers operating and funding obligations to
Daemaneng, de-risking Ironveld's cost base while allowing Ironveld to retain
its full ownership and control of the mining licence and governance oversight.

Based on currently anticipated production levels, Daemaneng is expected to
fund approximately ZAR 500 million (GBP21.6 million) of capital and
operational costs at Lapon and will recover verified expenditure from the
proceeds from realised sales of mined material, ensuring that returns are
aligned with production performance.

No equity participation or ownership interest in Lapon Mining or any other
Ironveld entity will accrue to Daemaneng under the Agreement.

Key Highlights

·      Ironveld to Incur No Operating or Capital Expenditure:

The Agreement transfers all mining-related operating and capital expenditure
to Daemaneng, enabling Ironveld to maintain full exposure to production upside
while eliminating direct cost risk and enhancing capital efficiency.

·      Three-Year Term and Five-Year Exclusivity:

The Agreement provides for an initial three-year operational term, with
Daemaneng expected to fund approximately ZAR 500 million (equivalent to GBP
21.6 million) in total capital and operational expenditure over the five-year
period. This investment commitment is based on Daemaneng's projected average
monthly mining cost of approximately ZAR 8.3 million and is recoverable solely
through realised sales of mined material.

The Contractor has been granted exclusive operating rights for five years,
conditional upon maintaining full compliance with all agreed investment,
production, and performance obligations. All ore supply and marketing
activities will be conducted on a transparent, open-book basis, ensuring
complete accountability, governance oversight, and alignment of interests
between the parties.

·      Guaranteed Ore Supply to the JV DMS Plant:

Daemaneng is contractually obligated to supply all ore required by Ironveld's
JV DMS plant, irrespective of volume or demand levels with no upper limit on
supply volumes. The Operator must meet all ore requirements necessary to
sustain continuous production, ensuring a fully reliable and scalable supply
chain to support Ironveld's downstream processing operations and future
production growth.

·      New and Additional Revenue Stream:

The partnership establishes an additional and strategically valuable income
channel through the commercialisation of Run-of-Mine ("ROM") material,
complementing Ironveld's DMS-grade magnetite production. Under the terms of
the Agreement, Daemaneng is contractually obligated to secure and manage all
offtake agreements for the ROM material, ensuring continuous market access and
sustainable revenue generation from the Lapon operations.

·      Commencement of Operations and Proven Track Record:

Mining operations under Daemaneng will commence shortly, with Daemaneng now
fully responsible for achieving all production volumes and quality standards
in line with market requirements, contractual obligations, and agreed
performance parameters. Having successfully mined material from Lapon in 2018,
Daemaneng brings proven operational familiarity with the deposit and its
infrastructure, positioning the project for immediate mobilisation, efficient
execution, and scalable growth.

Commenting on the Agreement, Kris Andersson, CEO of Ironveld PLC, said:

"This agreement marks a defining moment in Ironveld's transformation and the
first tangible step in pivoting the Company towards delivering a Company
focused on revenue generation, risk mitigation, and the realisation of the
significant inherent value within our assets.

"The partnership with Daemaneng establishes a performance-based framework that
is mutually beneficial and commercially aligned. Its structure ensures that
mining costs are minimised to maximise profitability, Daemaneng's upside is
driven entirely by operating efficiently, mining cost-effectively, and
marketing material at the most competitive prices.

"By engaging an established and operationally experienced partner, we are
unlocking immediate production at Lapon without further capital outlay. The
agreement removes the majority of mining-related expenditure from our balance
sheet while introducing a new revenue stream through ROM sales, enabling
Ironveld to benefit directly from production upside without operational
exposure or financial risk.

"Daemaneng's familiarity with the Lapon site, combined with their investment
commitment and established offtake channels, gives us confidence that
operations will ramp up rapidly and profitably. With no opex or capex
commitments in mining, Ironveld is now a leaner, significantly de-risked
business, well positioned for sustainable growth and long-term shareholder
value creation."

About Daemaneng Minerals (Pty) Ltd

Daemaneng Minerals (Pty) Ltd is a South African mining and contracting company
with a strong operational footprint across Southern Africa, active in a wide
range of commodities spanning both hard rock and soft rock environments. The
company is owned and managed by a team of experienced geologists and engineers
with a combined track record of more than 90 years in successful mining,
processing, and engineering operations. Daemaneng's expertise encompasses the
full mining value chain - from exploration and mine development to production,
logistics, and project optimisation - underpinned by a proven commitment to
safety, efficiency, and sustainable operational delivery.

Next Steps

Mining operations at Lapon will shortly transition to the management of
Daemaneng, who will assume full operational responsibility and mobilise its
own mining fleet, equipment, and personnel to site. This change will enable
the release of all previously contracted equipment and service providers,
thereby removing related monthly costs from Lapon's accounts.

Production and first ore deliveries to the DMS plant under Daemaneng are
targeted within the next 30 days. In parallel, initial ROM sales to offtakers
are anticipated to begin, further enhancing near-term cash flow generation.

Ironveld will continue to update shareholders as key production milestones are
achieved and as the Group advances towards sustained, long-term profitability.

Update on JV DMS Plant Operations

Ironveld PLC, together with its joint venture partner Sable Platinum Holdings
(Pty) Ltd, is currently evaluating several proposals for a Plant Operator
Agreement relating to the JV DMS plant. The terms of any such agreement will
be subject to mutual approval by Ironveld PLC and Sable Platinum Holdings
(Pty) Ltd. Ironveld and Sable are aligned on accelerating the scale-up of
DMS-grade magnetite production, with both parties recognising that engaging a
specialist plant operator offers the fastest and most cost-efficient means of
expanding capacity, subject to economic viability.

A move in this direction would be fully aligned with Ironveld's broader
strategy of profitably de-risking financial and operational exposure, as
demonstrated by the Mining Operations Agreement announced today with Daemaneng
Minerals (Pty) Ltd, and would ensure that the JV DMS plant is operationally
equipped to process the increasing ore volumes expected from Lapon, including
any necessary upgrades required to support future large-scale production
expansion.

Discussions and negotiations are ongoing and progressing positively, with both
parties confident that a mutually acceptable agreement for a Plant Operator
Agreement will be reached in the very near term, which should enable and
facilitate a natural transition towards the finalisation of the broader JV
agreement with Sable Platinum Holdings (Pty) Ltd.

Operational Progress Update

Ironveld is also pleased to report ongoing progress across its DMS and mining
operations in Limpopo, complementing the Daemaneng agreement and reinforcing
the Company's transition into production on a larger scale and cash-flow
generation.

DMS Plant Progress

Construction of the DMS plant was completed in May 2025, followed by
successful commissioning to produce a magnetite concentrate suitable for Dense
Media Separation ("DMS") applications.

During commissioning, throughput was progressively increased as the steel ball
load in the mill was optimised. The plant successfully achieved targeted
tonnage rates and consistently produced magnetite that met the required
magnetic content specifications. Minor refinements to product moisture and
sizing have been completed, and attention is now focused on optimising water
recovery and recirculation systems to support continuous operations.

Mining Progress

Mining activities have advanced in parallel. The initial open-pit overburden
strip of approximately 250 metres was completed in May, yielding around 2,000
tonnes of weathered magnetite ore for plant commissioning. In June, the first
waste blast across a 30-metre strike length was executed successfully, and by
late July, approximately 4,000 tonnes of fresh magnetite ore were blasted and
delivered to the DMS plant for the final stages of commissioning and separator
calibration.

Sales and Market Engagement

Initial trial production samples have been delivered to prospective offtake
partners, who provided positive feedback while identifying certain process
adjustments to further align production with specific requirements. These
adjustments have now been implemented.

Tender and Market Update

Regarding the tender process for the supply of DMS-grade magnetite previously
communicated, the Company can report that, following correspondence received
in mid-June 2025 and again in September 2025, the tender remains open and
under evaluation, with no award made to any party at this stage.

Feedback has been constructive and positive, noting satisfaction with the
quality of magnetite samples supplied during trial production. The
communication also confirmed continued interest in establishing a long-term
supply relationship, with the plants' logistical advantage and proximity to
key industrial users identified as important differentiating factors.

While the reasons for the delay in awarding the tender have not been
communicated, we have no reason to believe anything other than that we remain
well positioned within the process.

Beyond this process, the addressable market for DMS-grade magnetite in South
Africa alone currently exceeds 100,000 tonnes per month, with Mozambique and
Botswana also representing strategically attractive adjacent markets where
Ironveld continues to receive active commercial interest.

Outlook

Together with the Mining Operations Agreement announced today and the DMS
Joint Venture discussions with Sable Platinum Holdings, these developments
mark the next phase in delivering a leaner, performance-driven, and
cash-generative business.

 

For further information, please contact:

 

 Ironveld plc                                            c/o BlytheRay

 Kristoffer Andersson, Chief Executive Officer           +44 20 7138 3204

 Cavendish Capital Markets Limited (Nomad and Broker)    +44 20 7220 0500

 Derrick Lee

 Turner Pope Investments (TPI) Ltd (Joint Broker)        +44 20 3657 0050

 Andrew Thacker / James Pope

 BlytheRay                                               +44 20 7138 3204

 Tim Blythe / Megan Ray

 

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