REG - Mkango Resources Ltd - MAGINITO, AND COTEC FORM US JOINT VENTURE

Mkango ResourcesAnnouncement

14/09/2023 07:15

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RNS Number : 3814M  Mkango Resources Limited  14 September 2023

 

 

 

 

MKANGO RESOURCES LTD.                                                                                                              COTEC HOLDINGS CORP.

550 Burrard Street                                                                                                                                       755 Burrard Street

Suite 2900
 
 
               Suite 428

Vancouver
 
 
             Vancouver

BC V6C 0A3
 
 
               V6Z 1X6

Canada
 
 
                      Canada

 

MKANGO SUBSIDIARY, MAGINITO, AND COTEC FORM US JOINT VENTURE

 

 

London / Vancouver: September 14, 2023 - CoTec Holdings Corp. (TSXV: CTH;
OTCQB: CTHCF) ("CoTec") and Mkango Resources Ltd. (AIM/TSX-V: MKA) ("Mkango")
are pleased to announce that CoTec and Maginito Limited ("Maginito") have
entered into a binding letter agreement pursuant to which they have agreed a
50:50 joint venture (the "Joint Venture") in relation to the United States
roll-out of HyProMag's rare earth magnet recycling technology. HyProMag's
technology will be sublicenced to the new Joint Venture company, HyProMag US,
on formation.

HyProMag is 100 per cent owned by Maginito Limited ("Maginito"), which is
owned on a 90:10 basis by Mkango and CoTec. HyProMag is commercialising rare
earth magnet recycling using Hydrogen Processing of Magnet Scrap (HPMS)
technology in the UK, Germany and United States, with first production
expected in the UK in 2023 and in Germany in 2024. Revenue from the US Joint
Venture is targeted for 2025/2026.

The Joint Venture will initially be focused on completing a scoping study and
a bankable feasibility study ("Feasibility Study") for the deployment of three
HPMS vessels utilizing the HyProMag technology and one magnet manufacturing
facility in the US (combined the "US Project"). The Feasibility Study is
expected to be completed in 2024.  Following completion of the Feasibility
Study, CoTec and Mkango would make a joint decision on whether the Joint
Venture will proceed with the construction of the US Project.

CoTec will fund the initial operations of the Joint Venture, including the
costs of the Feasibility Study. If the Joint Venture proceeds with the
construction of the US Project, CoTec will also be responsible for funding all
the development costs of the US Project, with a total expected funding of £30
million to £50 million during the first three years post completion of the
Feasibility Study, subject to results of the Feasibility Study. All funding
provided by CoTec would be in the form of shareholder loans. CoTec and Mkango
also expect that the Joint Venture will seek US government funding for the US
Project.

The parties have agreed that certain long lead items could be pre-ordered to
expedite, subject to approval, the development of the US Project. A
comprehensive joint venture agreement dealing with all other commercial
aspects of the US Project, consistent with the terms of the existing
cooperation agreement between CoTec and Mkango, will be agreed by the parties
in parallel with the completion of the Feasibility Study.

Julian Treger, CoTec CEO commented; "This is a major step forward for CoTec
and Mkango/Maginito and we are looking forward to working with the Mkango and
HyProMag teams on this very exciting, proven and much needed technology in the
US targeting the long-term supply of low cost, sustainable recycled rare earth
magnets.

"The US presents a significant opportunity for the HyProMag technology and the
technical skills of Mkango and HyProMag combined with CoTec's commercial
strength could potentially provide shareholders with a unique and robust value
proposition in the rare earth industry in the right jurisdiction at the right
time."

"We look forward to working and collaborating with local, state and federal
stakeholders targeting the completion of the feasibility study".

Will Dawes, Mkango CEO commented; "We see a very significant opportunity in
the US market and look forward to working with CoTec and HyProMag as we move
into the next phase of growth."

"Less than 5 per cent of rare earth magnets are currently recycled from
end-of-life products. Increasing recycling rates via HyProMag's HPMS
technology solution to unlock this new potential source of rare earths,
thereby avoiding waste to landfill and significantly reducing the carbon
footprint, can make a major contribution to creating more sustainable and
robust rare earth supply chains across multiple jurisdications."

HPMS technology was developed at the University of Birmingham, underpinned by
approximately US$100 million of research and development funding, and has
major competitive advantages versus other rare magnet recycling technologies,
which are largely focused on chemical processes but do not solve the
challenges of liberating magnets from end-of-life scrap streams - HPMS
provides the solution. HyProMag's company presentation can be viewed via the
following link: HyProMag Corporate Presentation
(https://hypromag.com/wp-content/uploads/2023/09/HyProMag-Corporate-Introduction-28-July-2023.pdf)

Maginito

Maginito is a UK based Company owned 90 per cent by Mkango and 10 per cent by
CoTec. It is focused on developing green technology opportunities in the rare
earths supply chain, encompassing neodymium (NdFeB) magnet recycling as well
as innovative rare earth alloy, magnet, and separation technologies.

Maginito holds a 100 per cent interest in HyProMag and a 90 per cent direct
and indirect interest (assuming conversion of Maginito's recently announced
convertible loan) in HyProMag GmbH, focused on short loop rare earth magnet
recycling in the UK and Germany, and a 100 per cent interest in Mkango Rare
Earths UK Ltd ("Mkango UK"), a company focused on long loop rare earth magnet
recycling in the UK via a chemical route.

About Mkango Resources Ltd.

Mkango's corporate strategy is to develop new sustainable primary and
secondary sources of neodymium, praseodymium, dysprosium and terbium to supply
accelerating demand from electric vehicles, wind turbines and other clean
technologies. This integrated Mine, Refine, Recycle strategy differentiates
Mkango from its peers, uniquely positioning the Company in the rare earths
sector. Mkango is listed on the AIM and the TSX-V.

Mkango is developing its flagship Songwe Hill rare earths project ("Songwe")
in Malawi with a Definitive Feasibility Study completed in July 2022 and an
Environmental, Social and Health Impact Assessment approved by the Government
of Malawi in January 2023.

In parallel, Mkango and Grupa Azoty PULAWY, Poland's leading chemical have
agreed to work together towards development of a rare earth separation plant
at Pulawy in Poland (the "Pulawy Separation Plant") to process the purified
mixed rare earth carbonate produced at Songwe Hill.

Mkango also has an extensive exploration portfolio in Malawi, including the
Mchinji rutile exploration project, the Thambani
uranium-tantalum-niobium-zircon project and Chimimbe nickel-cobalt project.

For more information, please visit www.mkango.ca (http://www.mkango.ca)

 

 

 

About CoTec Holdings Corp.

CoTec is a publicly traded investment issuer listed on the Toronto Venture
Stock Exchange ("TSX- V") and the OTCQB and trades under the symbol CTH and
CTHCF respectively. The Company is an environment, social, and governance
("ESG")-focused company investing in innovative technologies that have the
potential to fundamentally change the way metals and minerals can be extracted
and processed for the purpose of applying those technologies to undervalued
operating assets and recycling opportunities, as the Company transitions into
a mid-tier mineral resource producer.

CoTec is committed to supporting the transition to a lower carbon future for
the extraction industry, a sector on the cusp of a green revolution as it
embraces technology and innovation. The Company has made four investments to
date and is actively pursuing operating opportunities where current technology
investments could be deployed.

For more information, please visit www.cotec.ca (http://www.cotec.ca) .

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement via Regulatory Information Service, this inside information is
now considered to be in the public domain.

Cautionary Note Regarding Forward-Looking Statements

This news release contains forward-looking statements (within the meaning of
that term under applicable securities laws) with respect to Mkango and CoTec.
Generally, forward looking statements can be identified by the use of words
such as "plans", "expects" or "is expected to", "scheduled", "estimates"
"intends", "anticipates", "believes", or variations of such words and phrases,
or statements that certain actions, events or results "can", "may", "could",
"would", "should", "might" or "will", occur or be achieved, or the negative
connotations thereof. Readers are cautioned not to place undue reliance on
forward-looking statements, as there can be no assurance that the plans,
intentions or expectations upon which they are based will occur. By their
nature, forward-looking statements involve numerous assumptions, known and
unknown risks and uncertainties, both general and specific, that contribute to
the possibility that the predictions, forecasts, projections and other
forward-looking statements will not occur, which may cause actual performance
and results in future periods to differ materially from any estimates or
projections of future performance or results expressed or implied by such
forward-looking statements. Such factors and risks include, without limiting
the foregoing, the availability of (or delays in obtaining) financing to
develop Songwe Hill, the Tyseley Recycling Plant, the HyProMag GmbH Recycling
Plant, the Mkango UK Pilot Plant, the Pulawy Separation Plant, governmental
action and other market effects on global demand and pricing for the metals
and associated downstream products for which Mkango is exploring, researching
and developing, geological, technical and regulatory matters relating to the
development of Songwe Hill, the ability to scale the HPMS and chemical
recycling technologies to commercial scale, competitors having greater
financial capability and effective competing technologies in the recycling and
separation business of Maginito and Mkango, availability of scrap supplies for
Maginito's recycling activities, government regulation (including the impact
of environmental and other regulations) on and the economics in relation to
recycling and the development of the Tyseley Recycling Plant, the HyProMag
GmbH Recycling Plant, the Mkango UK Pilot Plant, the Pulawy Separation Plant
and future investments in the United States pursuant to the proposed
cooperation agreement between Maginito and CoTec, the outcome and timing of
the completion of the feasibility studies, cost overruns, complexities in
building and operating the plants,  and the positive results of feasibility
studies on the various proposed aspects of Mkango's, Maginito's and CoTec's
activities. The forward-looking statements contained in this news release are
made as of the date of this news release. Except as required by law, the
Company and CoTec disclaim any intention and assume no obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable law.
Additionally, the Company and CoTec undertake no obligation to comment on the
expectations of, or statements made by, third parties in respect of the
matters discussed above.

 

For further information on Mkango, please contact:

Mkango Resources Limited

 

William Dawes                               Alexander Lemon

Chief Executive Officer                 President

will@mkango.ca                            alex@mkango.ca

Canada: +1 403 444 5979

www.mkango.ca (http://www.mkango.ca)

@MkangoResources

 

SP Angel Corporate Finance LLP

Nominated Adviser and Joint Broker

Jeff Keating, Kasia Brzozowska

UK: +44 20 3470 0470

 

Alternative Resource Capital

Joint Broker

Alex Wood, Keith Dowsing

UK: +44 20 7186 9004/5

 

Tavistock Communications

PR/IR Adviser

Jos Simson, Cath Drummond

UK: +44 (0) 20 7920 3150

mkango@tavistock.co.uk

 

For further information on CoTec, please contract:

 

CoTec Holdings Corp.

Braam Jonker

Chief Financial Officer

braam.jonker@cotec.ca

Canada: +1 604 992-5600

 

The TSX Venture Exchange has neither approved nor disapproved the contents of
this press release. Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this release.

This press release does not constitute an offer to sell or a solicitation of
an offer to buy any equity or other securities of the Company in the United
States. The securities of the Company will not be registered under the United
States Securities Act of 1933, as amended (the "U.S. Securities Act") and may
not be offered or sold within the United States to, or for the account or
benefit of, U.S. persons except in certain transactions exempt from the
registration requirements of the U.S. Securities Act.

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