REG - Rome Resources PLC - Settlement of claim against Mozambique Government

Rome ResourcesAnnouncement

20/03/2025 09:30

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RNS Number : 4926B  Rome Resources PLC  20 March 2025

This announcement contains inside information for the purposes of Regulation
11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the
publication of this announcement via a Regulatory Information Service, this
inside information is now considered to be in the public domain.

 

20 March 2025

 

Rome Resources Plc

("Rome" or the "Company")

 

Settlement of claim against the Mozambique Government for the expropriation
of Mining Concession 4623C

 

Rome Resources Plc (AIM: RMR), the DRC-focused tin and base metals
explorer, is pleased to announce that it has entered into a settlement
agreement with IM Minerals Limited ("IM") and the Mozambique government (the
"Settlement") in relation to the Company's legacy claim over the expropriation
of a heavy mineral sand mining concession 4623C in 2011 (the "Claim"). Rome
was formerly named Pathfinder Minerals plc ("Pathfinder") until 24 July 2024.

 

As part of the Settlement, the Mozambique government has agreed to grant five
new research and exploration licences to a registered Mozambican company (or
companies) to be nominated by IM (the "New Licences"). In this regard, Rome
will receive a 30 per cent. carried interest in the future value of the New
Licences, as further described below.

 

Background to the Claim

 

The Claim was sold by Pathfinder to Acumen Advisory Group LLC ("Acumen") by
way of a sale of the Company's wholly owned subsidiary, IM, which completed on
18 August 2023. The Claim was subsequently sold by  Acumen to Luangwa
Resources LLC ("Luangwa"), as announced on 29 January 2024 (the "Disposal").

 

Since then, and during the course of negotiations it became apparent that the
Mozambican government justified the expropriation of mining concession 4623C
on the basis of purported failures by the Company's previous management to put
in place sufficient safeguards prior to the expropriation. This resulted in a
perceived weakening of the Claim. Consequently, the Mozambique government did
not offer a cash settlement, resulting in a subsequent period of further
negotiation over a number of replacement New Licences which was ultimately
offered in lieu of a cash settlement.

 

Settlement details

 

The New Licences that form the Settlement are as follows:

 

Graphite Potential

a.                      Area 1 of Licence No. 5197,
covering a surface area of 18,857 ha (hectares);

b.                     Area 2 of Licence No. 5197,
covering a surface area of 14,003 ha;

 

Heavy Mineral Sands Potential

c.                      Licence No. 5186, covering a
surface area of 14,340 ha;

d.                     Licence No. 11344, covering a
surface area of 11,673 ha; and

e.                     Licence No. 9844, covering a
surface area of 860 ha.

 

The New Licences represents in aggregate approximately 59,733 hectares
(597km(2) or 147,540 acres), which is equivalent to an area the size of the
Isle of Man.

 

Two of the licences that form part of the New Licence areas are extensions of
active graphite mining projects and are anticipated to be the subject of an
early marketing campaign to generate cash returns for Luangwa. The remaining
three licences will require further technical work to mature the projects to
marketable status.

 

Further details of Rome's interest

 

While Luangwa will ultimately control the New Licences, under the terms of a
side agreement entered into with Luangwa following the Settlement (the "Side
Agreement"), Rome will receive a fixed 30 per cent. carried interest in either
the individual entities holding each licence or the holding company that
ultimately holds the New Licences. Rome will not be required to contribute to
any exploration expenditure or other costs in relation to the New Licences and
will maintain a passive interest.

 

The Company has agreed with Luangwa that if any value in the New Licences is
realized through either a disposal, share sale, listing or a farm-in
agreement, then if the aggregate amount of cash available for distribution
following such event is less than US$7 million, Luangwa's reasonable costs up
to a maximum of US$2 million shall be taken into account prior to any cash
distribution to the Company. In the event that the distributable cash
available is greater than US$7 million, then these costs will not be taken
into account.

 

Potential distribution to legacy Pathfinder shareholders

 

As noted in the Company's announcements on 16 August 2023 and 1 September
2023, shareholders in the Company as at 6:00pm on 5 September 2023 will be
entitled to a "Bonus Preference Share" entitling the holder thereof to
receive, subject to the Companies Act 2006, a preferential dividend equal to
the damages award that the Company may receive pursuant to the Claim. It was
also noted that if no award proceeds are received by the Company pursuant to
the Claim, no amount shall be payable to the holders of the Bonus Preference
Shares by the Company.

 

While the board of directors of Rome (the "Board" or the "Directors") welcomes
the positive news concerning the Settlement, including the issue of the New
Licences, the Board simultaneously recognises that some shareholders may be
disappointed with the form of the Settlement award being non-cash. With this
in mind, the Company will seek to work with Luangwa to realise any potential
value from the New Licences through the aforementioned liquidity events. While
there can no certainty that the New Licences can be monetised or the quantum
of any such monetisation, Rome will seek to distribute in due course the cash
proceeds of the New Licences, less expenses, to the holders of the Bonus
Preference Share.

 

Paul Barrett, Chief Executive Officer of Rome Resources Plc, commented:

 

"The Settlement gives the legacy shareholders, most promisingly through the
graphite licences, a potential route to monetary compensation for the claim
and Luangwa have assured the Company that they will seek to create a liquidity
event as soon as practicable. I must emphasise that the Company will not be
investing financial capital into this project and the exploration for tin and
copper at the Bisie North site in the DRC remains our single focus going
forward. In this regard, I look forward to updating shareholders on progress
relating to grades and volumes in the Bisie North Project in the near future."

 

The Company will release further announcements as and when appropriate.

 

Defined terms used but not defined in this announcement have the meanings set
out in the Company's announcement dated 16 August 2023.

 

**ENDS**

 

For further information, please contact:

 Investor questions on this announcement                                       https://romeresources.com/link/5Pmg6e (https://romeresources.com/link/5Pmg6e)

 We encourage all investors to share questions on this announcement via our
 investor hub
 Rome Resources Plc                                                            Tel. +44 (0)20 3143 6748

 Paul Barrett, Chief Executive Officer

 Mark Gasson, Chief Operating Officer

 Allenby Capital Limited (Nominated Adviser and Joint Broker)                  Tel. +44 (0)20 3328 5656

 John Depasquale / Vivek Bhardwaj / Lauren Wright (Corporate Finance)

 Stefano Aquilino / Joscelin Pinnington (Sales & Corporate Broking)

 OAK Securities (Joint Broker)                                                 email: jerry.keen@oak-securities.com

 Jerry Keen, Head of Corporate Broking                                         email: henry.clarke@oak-securities.com

 Henry Clarke, Head of Sales                                                   Tel. +44 (0)20 3973 3678
 Camarco (Financial PR)                                                        Tel. +44 (0) 20 3757 4980

 Gordon Poole / Emily Hall / Sam Morris

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