Commodities, Finance, News

MRG soars 300 per cent on new JV

MRG Metals

Shares in MRG Metals skyrocketed 300 per cent on Thursday after the company announced a binding joint venture (JV) to develop its Mozambique heavy mineral sands (HMS) projects.

Hong Kong investment companies Sinowin Lithium (HK) Co., Ltd and SINOWIN Lithium Cobalt (SLC) will invest an initial $US80,000 while the formal processes of setting up the JV are completed.

Once the JV is established, SLC will inject a further $US3 million to progress mine approvals, design and project economic analysis into the construction phase.

At the core of the JV are the Corridor Sands heavy mineral sands projects in Mozambique, which are rapidly advancing towards production.

The JV will see MRG free carried, including all capital expenditure and operating expenditure, through to 440,000 tonnes per annum (tpa) of concentrate production.

Upon receipt of $US3–6 million of capital funding, SLC shall hold 70 per cent of the JV equity, with MRG holding the balance.

Three stages of development shall see the Corridor Sands projects grow from 110,000tpa to 440,000tpa of concentrate production. This will see SLC grow its interest to 80 per cent. MRG’s stake will not be diluted less than 20 per cent.

SLC will be the offtaker for all HMS products from Corridor Sands, with the price fixed to current Mozambique HMS export prices.

“We are extremely pleased to establish this joint venture with SLC, a partner that shares our vision of developing this huge resource to the benefits of all stakeholders, including the local communities in Mozambique,” MRG chair Andrew Van Der Zwan said.

“SLC brings significant mining experience and capital capacity following its successful investment in the Moblan lithium mine and has been pursuing new development opportunities with even larger scope and upside to replicate this success.

“The journey for MRG has been a long one, but we have remained focused on advancing the Corridor Sands project, which offers multi-decade resource capacity and an exceptional infrastructure base, including access to water, electricity, manpower and importantly proximity to port.”

Van Der Zwan said Corridor Sounds is expected to be in the leading quartile for low-cost production globally.

“The high base grade will ensure a low cost to value concentrate operation, one which our partner is well positioned to optimise given relationships with downstream processors in mainland China,” he said.

SLC recently sold its 60 per cent equity in the Mobian lithium project in Peru for $US86.5 million, having bought into the asset in 2017 for $US60 million.

A feasibility study for the Corridor Sands project is set to be released shortly.

Subscribe to Australian Resources & Investment and receive the latest news on commodity prices, resource developments, executive movements and more.

Previous ArticleNext Article
Send this to a friend