REG - Neo Energy Metals - Agreement acquire Eagle Uranium Henkries South

Neo Energy MetalsAnnouncement

14/10/2024 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20241014:nRSN9692Ha&default-theme=true

RNS Number : 9692H  Neo Energy Metals PLC  14 October 2024

Neo Energy Metals plc / LSE: NEO, A2X: NEO / Market: Main Market of the London
Stock Exchange

 

14 October 2024

Neo Energy Metals plc

('Neo Energy' or 'the Company')

 

Acquisition of the Henkries South Uranium Project Further Consolidates Neo
Energy Metals' Strategic Uranium Holdings in the Northern Cape Province

Neo Energy, the near term, low-cost uranium developer, is pleased to announce
that its wholly owned South African subsidiary, Neo Uranium Resources South
Africa (Pty) Ltd ('NURSA'), has entered into a binding heads of agreement
('Agreement') to acquire a 100% interest in the Henkries South Uranium Project
('Henkries South') from South African uranium exploration company, Eagle
Uranium SA (Pty) Ltd ('Eagle Uranium').

The Henkries South Project comprises one granted Prospecting Licence that
extends over approximately 1,050km(2) and is immediately south and adjoins the
Company's existing Henkries Uranium Project located in the administrative
district of Namaqualand in the Northern Cape Province of South Africa.

The acquisition of Henkries South materially increases the Company's strategic
landholding in the region by over 130% from a current 742km(2) area to almost
1,800km(2). It adds a further 10km strike length of shallow paleo-channels to
the current 36km of strike length of paleo-channels that have been
demonstrated to host the shallow uranium mineralisation at the Company's
Henkries Project from the multiple resource drilling programmes and
feasibility work completed as part of the historic US$30 million of
exploration and development expenditure.

Previous exploration combined with investigations completed by the Company's
technical management team has shown that Henkries South contains multiple
radioactive anomalies located throughout the licence area and given the extent
of these radiometric anomalies, these targets are expected to add
significantly to the resource potential at the Henkries Project.

In addition, the shallow and at surface uranium mineralisation seen at the
Company's Henkries Project is considered to have been derived from uranium
that has been transported across and from Henkries South, from the uraniferous
granites in Springbok. Uranium mineralisation in the southern area of the
Henkries Project is seen at surface and at shallow depths of up to 6.0m,
demonstrates good continuity and averages between 300ppm U(3)O(8) to 400ppm
U(3)O(8) and has always been considered as offering the potential for major
new and significant uranium discoveries.

The acquisition of Henkries South underscores the Company's commitment to
rapidly advance the Henkries Project towards production and now provides the
opportunity for the Company to consider a significantly larger scale mining
operation delivering on low-cost uranium in the near-term.

The acquisition of Henkries South follows the independent technical update
report completed by South African mining consultants, Erudite Strategies
Limited completed in June 2024, which confirmed the low operating and capital
costs and overall robust project economics of the Henkries Project and has
provided the Company with the technical and economic basis upon which to
further consolidate its position in the Northern Cape's highly attractive and
fast emerging uranium sector.

The Henkries South acquisition is the second of three strategic uranium
acquisitions being undertaken by the Company and follows shortly after the
signing last month of the formal acquisition documentation by the Company to
acquire the Beisa North and Beisa South Uranium and Gold Projects, which have
existing resources of 90Mlbs of U₃O₈ and 4.2Mozs of gold extending over an
area of approximately 80km(2) in the Witwatersrand Basin, located in the Free
State Province of South Africa.

These acquisitions are being undertaken in line with the Company's strategy to
establish itself as South Africa's leading uranium mining company and one of
Africa's major uranium mine operators and developers.

Under the commercial terms of the Agreement, the Company will now issue Eagle
Uranium and the minority shareholders in Henkries South with 25 million shares
in the Company and will repay ZAR600,000 (approximately £26,500) of
inter-company debt. On execution of formal documentation and receipt of all
necessary regulatory approvals, the Company will issue a further 175 million
shares to Eagle Uranium and repay an additional amount of ZAR1.7 million
(approximately £75,000) of existing indebtedness. Further deferred equity
payments of 125 million shares in the Company for each 5Mlb of JORC Compliant
Resources of uranium will be issued up to a maximum of 250 million shares in
the Company.

Highlights:

·    Agreement signed with Eagle Uranium to acquire a 100% interest in the
Henkries South Uranium Project

·    Henkries South is located immediately south of and is contiguous to
the Company's existing Henkries Uranium Project

·    The Henkries South Project comprises one granted Prospecting Licence
that extends over approximately 1,050km2 and includes the farms Naip no. 68,
Eendop no. 69, Kontorogab no. 75, Kweekfontein no. 73 and Kaitob no. 74, all
located in the administrative district of Namaqualand

·    The acquisition more than doubles the Company's strategic landholding
in the uranium prospective region from 742km2 to almost 1,800km2

·    Henkries South contains multiple radioactive anomalies that have been
located throughout the approximately 1,050km2 licence area

·    Given the extent of these radiometric anomalies, these targets are
expected to add significantly to the resource potential at the Henkries
Project as further resource drilling and metallurgical test work is completed
by the Company in 2024 and 2025

·    The uranium hosted paleo-channels in the Company's Henkries Project,
which extend for almost 40km in strike length, have been further identified in
Henkries South to extend for over 30km of strike length based on mapping and
airborne radiometric data interpretation

·    The shallow and at surface uranium mineralisation seen at the
Company's Henkries Project is considered to have been derived from uranium
that has been transported across Henkries South from the uraniferous granites
located near Springbok

·    This uranium mineralisation that has been identified in the southern
area of the Henkries Project is extremely shallow and has uranium grades of
between 300ppm U3O8 to 400ppm U3O8. The same mineralisation trend is expected
in Henkries South where the Company sees the potential for several major new
and significant uranium discoveries

·    Independent technical work completed in June 2024 on the previous
positive feasibility study completed on the Henkries Project by Anglo
Operations Limited, confirmed the low operating and capital costs and overall
robust project economics of the Henkries Project and supports the Company's
strategy to expand its position with this acquisition of Henkries South which
adjoins the Henkries Project

·    The Company's technical management team and consultants will now
commence further work on the airborne radiometric data and on mapping and
sampling work to better assess the extent of the uranium anomalies and
paleo-channels that host the at surface and shallow uranium mineralisation

·    It is proposed that the Company's planned uranium resource expansion
drilling work that is to commence later this quarter on the Henkries Project
will be extended to also now include Henkries South

·    Completion of the formal documentation for the acquisition of
Henkries South is expected during October 2024, with the Company and Eagle
Uranium to then seek receipt of all applicable regulatory approvals for the
acquisition

·    The Henkries South acquisition is the second of three planned uranium
acquisitions to be completed by the Company to consolidate its position around
the Henkries Project in the Northern Cape Province and around the recently
acquired Beisa North and Beisa South Uranium and Gold Projects in the
Witwatersrand Basin, located in the Free State Province of South Africa.

·    The acquisition of Henkries South is considered another key step by
the Board in advancing its strategy to position Neo Energy as South Africa's
leading uranium mining company and one of Africa's major uranium mine
operators and developers

·    Further updates on additional uranium project acquisitions are
anticipated to be made shortly as the Company looks to strengthen its
portfolio of uranium projects for both mine development and resource expansion

Sean Heathcote, Neo Energy Metals CEO said:

"We are excited to announce the successful acquisition of the Henkries South
Uranium Project held by Eagle Uranium.

Located immediately south of our current operations at our Henkries Project,
we recognised the strategic potential of this opportunity well before our
listing on the London Stock Exchange last year and we are therefore pleased to
have now finalised this acquisition, which we have patiently diligently
pursued to maximise value for our shareholders.

From a technical and geological perspective this acquisition is particularly
significant due to its location within the uranium migration pathway,
connecting the Springbok granites with the deposition in the Kao paleo channel
at Henkries Central and Henkries North. As a result, this expansion more than
doubles our strategic landholdings in the pivotal Northern Cape region. Our
investigations indicate that this area holds considerable potential to both
increase the scale of our planned Henkries Uranium Mine and to extend its mine
life significantly.

We aim to finalise the formal documentation in October 2024 and to then secure
the necessary regulatory approvals for this acquisition and in tandem with the
ongoing process for the Beisa North and South Projects.

We view this acquisition as a vital step in our growth strategy in South
Africa's uranium sector, reinforcing our commitment and consolidating our
position in one of the most prospective uranium regions in South Africa, an
area we are committed to both accelerate our exploration and new mine
development activities.

We are very optimistic about the opportunities this acquisition presents as we
continue to execute our strategy of building a leading uranium-focused company
and we look forward to providing further updates on these acquisitions in due
course."

Admission

Application has been made for the Acquisition Shares to be admitted to trading
on the London Stock Exchange on or around 14 October 2024 ('Admission') and
will rank pari passu with the ordinary shares of the Company in issue.

Total Voting Rights

Following Admission, the Company's issued share capital will comprise
1,494,002,668 ordinary shares of 0.01p each, with each share carrying the
right to one vote, therefore the total number of voting rights in the Company
will be 1,494,002,668. This figure may be used by shareholders as the
denominator for calculations by which they will determine if they are required
to notify their interest in the Company, or a change to their interest in the
Company, under the Financial Conduct Authority's Disclosure Guidance and
Transparency Rules.

This announcement contains inside information for the purposes of the UK
Market Abuse Regulation, and the Directors of the Company are responsible for
the release of this announcement.

ENDS

 

About NEO Energy Metals Plc

Neo Energy is a Uranium developer and mining company listed on the main market
of the London Stock Exchange (LSE: NEO). The Company holds up to a 70% stake
in the Henkries Uranium Project, an advanced, low-cost mine located in South
Africa's Northern Cape Province. It has been estimated by some that the
historical investment in the project was over US$30 million in exploration and
feasibility studies. Neo Energy aims to increase the project's mineral
resources and complete an updated feasibility study with the aim of bringing
Henkries into production in the shortest possible timeframe.

The Company also holds a 100% interest in the Beisa North and Beisa South
Uranium and Gold Projects in the Witwatersrand Basin, located in the Free
State Province of South Africa. The combined projects record a total SAMREC
Code compliant resources of 90.24 million pounds ('Mlbs') of U₃O₈ and 4.17
million ounces ('Mozs') of gold.

The Company is led by a proven board and management team with experience in
uranium and mineral project development in Southern Africa. Neo Energy's
strategy focuses on an accelerated development and production approach to
generate cash flow from Henkries while planning for long-term exploration and
portfolio growth in the highly prospective Uranium district of Africa.

The Company's shares are also listed on the A2X Markets (A2X: NEO), an
independent South African stock exchange, to enable the Company to expand its
investor base and facilitate strategic acquisitions of uranium projects,
particularly within South Africa.

For Enquiries Contact:

 

 Sean Heathcote             Chief Executive Officer  sean@neoenergymetals.com
 Jason Brewer               Executive Chairman       jason@neoenergymetals.com
 Faith Kinyanjui            Investor Relations       faith@neoenergymetals.com
 Tel: +44 (0) 20 7236 1177

 Michelle Krastanov         Corporate Advisor (SA)   michelle@acaciacap.co.za

 Tel: +27 (0) 11 480 8500

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  AGRFFMFUDELSEES