Month: February 2019

QUARTERLY ACTIVITIES REPORT TO 31 DECEMBER 2018

QUARTERLY ACTIVITIES REPORT TO 31 DECEMBER 2018

Highlights:

  • Mining Licences covering Stage 1 and 2 developments at Bunyu granted – all key approvals and licences now in place in preparation for commence of Stage 1 development work program
  • Tanzanian roadshow and North American investor meetings completed during the quarter
  • A$1.3 million secured via short-term funding facility to provide additional funding flexibility whilst Stage 1 development funding is completed

Tanzanian-focused flake graphite development company Volt Resources Limited (ASX: VRC) (“Volt” or, the “Company”) is pleased to provide its quarterly activities report for the period ended 31 December 2018.


Receipt of Bunyu Mining Licences

In October, Volt received two Mining Licences (“ML’s”) ML 591/2018 and ML 592/2018 from the Mining Commission of the Ministry of Minerals of Tanzania, that cover the respective Stage 1 and Stage 2 development footprints at Bunyu. Importantly, Volt has now received all key approvals for the Stage 1 and Stage 2 developments of the Bunyu Graphite Project.

The ML’s cover a combined area of 17.71km2 and provide Volt with the exclusive right to develop the graphite resources within the ML area. The ML’s are effective for a period of 10 years and there is a right of further 10-year renewals under section 53 of the Mining Act.

Stage 1 Development Funding

As previously advised, Volt has engaged Exotix Capital as funding advisor to undertake a Tanzanian Note Issue to raise the required funding for the Stage 1 development at Bunyu (see ASX Announcement dated 25 October 2017).

The Note Offer is by Volt’s wholly-owned subsidiary Volt Graphite Tanzania plc (“VGT”) through the issue of a Prospectus to potential investors in East Africa. The Notes are to be listed on the Dar es Salaam Stock Exchange (DSE) which required the approval of the DSE.

On 13 December 2018, VGT received approval from the Dar es Salaam Stock Exchange PLC to list its Notes on the Dar es Salaam Stock Exchange (“DSE”).

In addition, the issue of the Note Prospectus to investors requires the approval of Tanzania’s corporate regulator the Capital Markets and Securities Authority (CMSA). Post the quarter end, VGT received correspondence from the CMSA on Friday 25 January 2019 which set unrealistic commercial terms for the Note Issue to proceed. Volt will continue to discuss the Note Issue with the CMSA in the short term, to ensure an appropriate commercial balance is reached.

In parallel, Volt will continue to advance alternative funding options including, but not limited to a Note Issue and Listing on the Stock Exchange of Mauritius (“SEM”) that is using principally the same Tanzanian Note Prospectus, and US based institutional funds participation in the Stage 1 development funding.

Funds raised will be deployed towards the Stage 1 development of the Bunyu Graphite Project. A Definitive Feasibility Study (“DFS”) on the large-scale Stage 2 Expansion at Bunyu will also be undertaken concurrently with the Stage 1 development.

Roadshow and Investor Meeting Activity

During the quarter, Volt completed investor meetings in North America and an investor roadshow in East Africa. The Company is pleased to advise that strong interest was received from a number of investment funds and banks. Volt and Exotix Capital are continuing to actively progress a number of discussions in relation to the Stage 1 development funding requirements through 2019-2020.

A$1.3 Million Funding Facility Secured

Post-quarter end, the Company secured a short-term (6-month) funding facility of A$1.3 million, providing added funded flexibility over the coming months while the Company completes its development funding activities. The funding facility will not be dilutionary to existing shareholders as no equity will be issued during the 6-month loan period.

Research and Development Claim

During the quarter Volt lodged its income tax return and supporting R&D Tax incentive claim for the 2018 financial year, whereby the Company receives a 43.5% cash rebate on eligible R&D expenditure. This resulted in an R&D cash refund from the Australian taxation office of $641,173 in late December 2018, following which the Company repaid the $512,000 R&D loan received from the R&D Loan funder Radium Capital earlier in the quarter.

Project Development

In preparation for the planned development of Stage 1, four high quality responses were received from well credentialled and experienced engineering consultancies for the role of Project Management Consultant (PMC).

The four proposals were evaluated and post quarter end, a short list of proponents was interviewed to enable an appointment of the preferred engineering consultant in the new year. The selected PMC will manage the implementation of the Stage 1 development of the Bunyu Project in conjunction with Volt Graphite Tanzania.

Management Commentary

Volt Resources CEO Trevor Matthews commented:

“Our immediate priority remains on successfully completing our Stage 1 development funding process to enable the commencement of the Stage 1 development program. The interim bridge funding facility secured in January has provided added flexibility whilst the funding process is finalised.

“We look forward to providing further updates on the development funding process and the commencement of development work throughout this quarter.”

For and on behalf of Volt Resources Limited

Trevor Matthews
Chief Executive Officer


FOR PERSONAL USE ONLY
For further information please contact:
Trevor Matthews – Chief Executive Officer
Tel: +61 8 9486 7788

Posted by Volt Resources in Company News