REG-Medcaw Investments Plc: Update re: Abyssinian Project

Medcaw InvestmentsAnnouncement

11/11/2024 07:15

11(th )November 2024

Medcaw Investments plc
(“Medcaw Investments” or the “Company”)

Update of Abyssinian Project

Medcaw Investments plc (LSE: MCI), a listed acquisition vehicle, acknowledges
the recent press release issued by Abyssinian Metals Limited (AML). The
Company remains fully committed to the previously announced transaction to
acquire AML, facilitating its public listing on the Main Market of the London
Stock Exchange through a reverse takeover. The board of Medcaw Investments
will continue to work closely with AML and monitor developments in the ongoing
dispute.

Unlawful seizure and detention of Abyssinian Group executive

8 November 2024

Over the past 12 months, Abyssinian Metals Limited (AML), African Mining and
Energy Pty Ltd (AME), Abyssinian Investments BV (a Netherlands company), and
Kenticha Mining PLC (together the Abyssinian Group), have been negotiating in
good faith to resolve their dispute with the Federal Democratic Republic of
Ethiopia (including Oromia State) in relation to the Kenticha Lithium Project.
The dispute is described in more detail in the Background section below.

Recently, our colleague and fellow director of Abyssinian Group subsidiary
AME, Mr Ali Hussein Mohammed, an Ethiopian national resident in Addis Ababa,
was unlawfully detained by Oromia State Officials. This occurred at a meeting
at the Oromia State offices in Addis Ababa. When Ali was invited to this
meeting, he was told that the purpose of the meeting was to finalise the
agreement to resolve the dispute concerning the Kenticha Lithium Project. The
Attorney General representing Oromia State at the meeting purported to place
Ali under arrest, without presenting a warrant or informing him of any charges
(contrary to both Ethiopian and international law). Ali was then taken away in
an ambulance (he had no medical condition to require ambulance transport) to
an Oromia State building outside Addia Ababa, where he was held against his
will.  We understand that Ali was later charged with illegal mining at
Kenticha, although no evidence has been presented to support this charge.
Further charges have apparently been levelled against Ali, in support of which
no evidence has been presented either.

The unlawful seizure and detention of Ali occurred during a negotiation
process under the Agreement on Encouragement and Reciprocal Protection of
Investment between the Federal Democratic Republic of Ethiopia and the Kingdom
of The Netherlands (Treaty). Under the Treaty, all parties to a dispute are
legally obliged to maintain the status quo and refrain from any acts that may
aggravate the dispute during the negotiation process. In addition to other
violations of the Treaty and international law, this obligation has been
breached by the Federal Democratic Republic of Ethiopia (which is legally
responsible for the conduct of Oromia State and its officials).

The Abyssinian Group calls upon the Federal Democratic Republic of Ethiopia to
compel Oromia State to release Ali from unlawful detention immediately.
Assistance is being provided by the Australian Embassy in Addis Ababa, in
conjunction with other bodies we are seeking assistance including the British
Embassy, the UN Working Group on Arbitrary Detention, the African Union, the
European Union in Ethiopia, the US State Department, the World Bank, the IMF,
the International Red Cross and Amnesty International.

In light of these alarming developments, the Abyssinian Group will proceed to
arbitration at the International Centre for Settlement of Investment Disputes
(ICSID), in accordance with the Treaty. ICSID is a World Bank body
headquartered in Washington, DC. In addition to its existing claims under the
Treaty, the Abyssinian Group will raise the unlawful detention of Ali, with
ICSID, along with other acts of intimidation and harassment that personnel
employed by the Abyssinian Group have suffered and seek appropriate relief.

Stephen Miller, Managing Director of AME, offered the following remarks:

"We are shocked by the actions of the government of Oromia Regional State in
unlawfully seizing and detaining our colleague Mr Ali Hussein Mohammed. Our
most pressing task is to secure the immediate release of Ali.

The Abyssinian Group came to Ethiopia in good faith and has invested
substantial capital and expertise in the Kenticha Lithium Project. For the
last 12 months, the Abyssinian Group has persisted with negotiations to
resolve the dispute in accordance with the Treaty. Prior to Ali’s unlawful
seizure and detention, we understood that all parties had agreed to a path
toward resolution of the dispute and that we would soon be permitted to resume
our work on the Kenticha Lithium Project. Sadly, it is now apparent that we
were misled.

International investment and investor confidence are critical to unlocking the
vast mineral resources of Ethiopia – if investors do not feel confidence in
a country, they will go elsewhere. By their recent unlawful actions, Oromia
State officials have severally damaged investor confidence, and this will
likely affect foreign investment flows into the Ethiopian mining sector for
the foreseeable future.

The Abyssinian Group will protect the interests of its shareholders by
proceeding to international arbitration at ICSID in order to obtain
compensation for the unlawful treatment and expropriation of our investments
in the world-class Kenticha Lithium Project.”

Background to Dispute

On 10 November 2023, the Abyssinian Group issued a Notice of Dispute and
Request for Negotiations to the Federal Democratic Republic of Ethiopia under
Treaty. The dispute concerns measures taken against the Abyssinian Group’s
investments in the Kenticha Lithium Project in Oromia State, Ethiopia (the
Dispute).

The same day, the Abyssinian Group issued a Force Majeure notice to the
Ethiopian Federal Ministry of Mines and Petroleum (Ministry) relating to the
Abyssinian Group’s inability to access the Kenticha Lithium Project site and
continue with the agreed work programme. This notice was issued by the joint
venture company Kenticha Mining PLC (KMP), in which members of the Abyssinian
Group hold a 51% interest, and Oromia Share Mining Company (OMSC) holds 49%.
OMSC is a State-owned enterprise of Oromia State.

The Abyssinian Group’s rights over the Kenticha Lithium Project are held by
KMP, through an exploration license agreement with the Ministry (dated January
2023), an exploration license issued by the Ministry, and a mining license
issued by the Ministry over the historical tailings area at the Kenticha
Lithium Project site (together, the Licenses). Through the work
and investment of the Abyssinian Group, a JORC compliant resource of 85.6Mt
at 0.98% lithium oxide (Open pit) + ~50Mt exploration target (at similar
grades) has been identified.

The Abyssinian Group has been working to establish a large, international
standard mining operation at Kenticha, which was scheduled to commence
production of spodumene concentrate (SC5.5%) in Q4 2024.

The Abyssinian Group’s investments in the Kenticha Lithium Project are
protected by the Treaty. The Treaty includes standard protections for covered
investments, including a guarantee of fair and equitable treatment, full
protection and security, and non-impairment of investments by unreasonable and
discriminatory measures. The Treaty also prohibits the unlawful expropriation
of covered investments. The Treaty provides that, in the event of a dispute
between a covered investor (in this case, the relevant members of the
Abyssinian Group) and the host state (in this case, Ethiopia), the investor
and the host state is required to attempt to resolve the dispute through
amicable negotiations for a period of six months. If the dispute is not
amicably resolved in this way, the Treaty provides for the dispute to be
resolved by international arbitration outside of the host state.

This announcement contains inside information for the purposes of
the UK Market Abuse Regulation and the Directors of the Company accept
responsibility for the contents of this announcement.

ENDS

Enquiries:

Medcaw Investments Plc
Charlie Wood                      +44 (0)203 918 8797

Abyssinian Metals Limited
Via Tavistock Communications    +44 (0) 207 920 3150

For more information please visit: https://medcaw-invest.com/

Note:

Certain statements made in this announcement are forward-looking statements.
These forward-looking statements are not historical facts but rather are based
on the Company's current expectations, estimates, and projections about its
industry; its beliefs; and assumptions. Words such as 'anticipates,'
'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar
expressions are intended to identify forward-looking statements. These
statements are not a guarantee of future performance and are subject to known
and unknown risks, uncertainties, and other factors, some of which are beyond
the Company's control, are difficult to predict, and could cause actual
results to differ materially from those expressed or forecasted in the
forward-looking statements. The Company cautions security holders and
prospective security holders not to place undue reliance on these
forward-looking statements, which reflect the view of the Company only as of
the date of this announcement. The forward-looking statements made in this
announcement relate only to events as of the date on which the statements are
made. The Company will not undertake any obligation to release publicly any
revisions or updates to these forward-looking statements to reflect events,
circumstances, or unanticipated events occurring after the date of this
announcement except as required by law or by any appropriate regulatory
authority.



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