TIDMBEM
RNS Number : 6578B
Beowulf Mining PLC
03 February 2020
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations ("MAR") (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
3 February 2020
Beowulf Mining plc
("Beowulf" or the "Company")
Management Update on Kallak
Beowulf (AIM: BEM; Spotlight: BEO), the mineral exploration and
development company, provides a management update on the Company's
business areas.
Kallak Iron Ore Project ("Kallak")
The Beowulf Board will meet in Stockholm on 12 February 2019 to
discuss the continuing and unacceptable delays in getting a
decision from The Government of Sweden (the "Government") on the
Company's application for an Exploitation Concession (the
"Concession") for Kallak. The Board is already in receipt of a
paper detailing options, prepared by the Company's lawyers, and
actively considering ring-fencing funds for legal action.
The CEO has not received a response to his letter, sent on 19
December 2020, written again to Minister Ibrahim Baylan, the
Minister for Business, Industry and Innovation.
In response to the CEO's previous letter, sent last September,
Minister Baylan explained that the CEO's request for a meeting at
the time "concerns a forthcoming Government decision - a dossier
that is currently under preparation", and that the Government is
unable to meet or comment with regard to its "ongoing review".
At the recent 'Roundtable on mining in northern Sweden' hosted
by Länsstyrelsen Norrbotten, Länsstyrelsen Västerbotten, Boliden
and LKAB, the Government's representative, the State Secretary to
the Minister for Business, Industry and Innovation, was also unable
to shed any light on the handling of the Company's application by
the Government, nor the timing of a decision.
The Company understands that the Government has received and
registered the concluding statement (the "Statement") for Kallak
sent to the Government on 8 November 2019, prepared by the law
firms Mannheimer Swartling and Fröberg & Lundholm. No further
communication has taken place. The Statement did not include any
new facts in the Kallak case, as all necessary and relevant facts
have already been established as part of the application process.
Rather, the Statement summarises the circumstances relevant to a
judicial review of whether Beowulf should be awarded the Concession
for Kallak. The Statement concludes that Beowulf should be awarded
the Concession.
Kallak Exploration in 2020
As announced previously, Beowulf is a partner in the European
Union ("EU") funded PACIFIC Project ("PACIFIC"), launched in June
2018. The project has received EUR3.2 million from the EU's Horizon
2020 research and innovation programme and has a 36-month programme
of activities being coordinated by Université Grenoble Alpes.
The aim of PACIFIC is to develop a new, low-cost and
environmentally friendly tool for exploring for sub-surface mineral
deposits. The PACIFIC consortium is conducting fundamental and
applied research to develop two radically new and complementary
mineral exploration techniques, both based on passive seismic
imagery. See project website for more information:
https://www.pacific-h2020.eu/
Kallak, including Kallak North, Kallak South and the Parkijaure
licence, has been chosen as one of two PACIFIC test sites.
In September 2019, Phase 1 work took place at Kallak, which
included testing the multi-array method, using an array of
receivers at surface, over the known magnetite ore at Kallak South
to provide background data, the seismic properties for the iron ore
and to correlate findings with the geological model for Kallak.
In Autumn 2020, Phase 2 work will commence testing the
multi-array method in parallel with drilling at Kallak South, with
noise from drilling providing a passive seismic source. Testwork
will determine if a 3D seismic model can be constructed, using the
established seismic characteristics of the Kallak deposit, and
whether the 3D model can be used to identify previously
undiscovered magnetite mineralisation for the Kallak South
Exploration Target areas and for Parkijaure.
In anticipation of the Concession being awarded for Kallak
North, the Company would then consider a follow-up programme of
drilling at Kallak South and Parkijaure. The Company was awarded an
Exploration Licence for Parkijaure nr 6, covering almost 1,000
hectares immediately to the south of the Kallak deposits, and
similarly prospective for magnetite iron ore, on 24 October
2019.
Kurt Budge, Chief Executive Officer of Beowulf, commented:
"Last year, the Board noted Aura Energy's ("Aura") written
notification to the Swedish Government under the Energy Charter
Treaty seeking compensation over the uranium ban introduced in
Sweden on 1 August 2018 and the financial loss to Aura resulting
from this decision. An example of the goalposts being moved after a
company has made a significant investment in a mining project in
Sweden.
"It has never been the Company's preferred option to 'go legal',
but the Government's handling of the Kallak application is
seemingly inept, and for all the talk of the current Minister and
his predecessor, words have shown to mean very little. The absence
of a transparent and predictable process is forcing the Company to
consider legal options in moving the application forward.
"At the event I recently attended in Luleå, convened by the
Governors of Norrbotten and Västerbotten, Beowulf played its part
in the debate on the permitting of mines in Sweden, a shared vision
of a fossil free, modern, sustainable and transparent mining
industry - a world leader. To have a sustainable mining industry
you need to permit new mine developments to supply the raw
materials that society needs. Iron ore is part of Sweden's mining
heritage, a core business activity of the State, and security of a
sustainable source of future supply, such as defined at Kallak,
should be permitted.
"In Jokkmokk, during my time as CEO, Beowulf has shown respect
for its stakeholders and sought to develop Kallak in partnership
with the community, safeguarding all interests, including reindeer
herding. Our ambition remains to develop the most modern and
sustainable mining operation to showcase the best of Swedish
design, engineering and innovation, and give Jokkmokk the thriving,
diversified and sustainable economic future that realistically only
Kallak would deliver.
"Every job counts in Jokkmokk. Kallak could create 250 direct
jobs at the mine, and 300 indirect jobs, over a mine life of 25
years or more, with sequential mining of Kallak North and South,
and the prospect of discovering more iron ore at Parkijaure."
"The first exploration licence at Kallak was granted in 2006 and
Beowulf has invested over SEK 80 million to date. We have even been
granted an Exploration Licence for Parkijaure in October last year,
so obviously, we are not operating in a 'no go' area.
"Over the last five years, the Company has sought to address any
outstanding matters with our application, of which there have been
none since late 2014. Last November, we submitted a concluding
statement for Kallak to the Government. The Statement summarises
the circumstances relevant to a judicial review of whether the
Concession should be awarded and concludes that the Concession
should be awarded.
"Beowulf has voluntarily provided more information than required
to be awarded an Exploitation Concession, and yet, the scant regard
given to the Company and its shareholders by the Government, the
apparent disregard for our investment, and the absence of any
communication that informs on how our application is being handled
and the timeline to a decision, continue to shock me, and to
question whether any junior explorer/developer should consider
Sweden as a country to invest in.
"The mishandling of the Kallak application has constrained the
Company delivering on its ambitions, putting pressure on the
Company's share price and the efficiency with which we can raise
capital. The 'opportunity cost' of the last five years for the
Company, its shareholders and the community of Jokkmokk is
significant.
"Whatever happens with Kallak this year, the Company will stay
committed to the project.
"I look forward to keeping the market updated on further
developments with Kallak, with Fennoscandian Resources and Vardar
Minerals."
Enquiries:
Beowulf Mining plc
Kurt Budge, Chief Executive Tel: +44 (0) 20 3771
Officer 6993
SP Angel
(Nominated Adviser & Broker)
Ewan Leggat / Soltan Tagiev Tel: +44 (0) 20 3470
0470
Blytheweigh
Tim Blythe / Megan Ray Tel: +44 (0) 20 7138
3204
Cautionary Statement
Statements and assumptions made in this document with respect to
the Company's current plans, estimates, strategies and beliefs, and
other statements that are not historical facts, are forward-looking
statements about the future performance of Beowulf. Forward-looking
statements include, but are not limited to, those using words such
as "may", "might", "seeks", "expects", "anticipates", "estimates",
"believes", "projects", "plans", strategy", "forecast" and similar
expressions. These statements reflect management's expectations and
assumptions in light of currently available information. They are
subject to a number of risks and uncertainties, including, but not
limited to , (i) changes in the economic, regulatory and political
environments in the countries where Beowulf operates; (ii) changes
relating to the geological information available in respect of the
various projects undertaken; (iii) Beowulf's continued ability to
secure enough financing to carry on its operations as a going
concern; (iv) the success of its potential joint ventures and
alliances, if any; (v) metal prices, particularly as regards iron
ore. In the light of the many risks
and uncertainties surrounding any mineral project at an early
stage of its development, the actual results could differ
materially from those presented and forecast in this document.
Beowulf assumes no unconditional obligation to immediately update
any such statements and/or forecasts.
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END
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