Nordic Mining’s interim report per 31 December 2016
Enclosed please find Nordic Mining’s interim report for the fourth quarter 2016. The interim report and company updates will be presented today, Tuesday 21 February 2017 at 09.30 in the company’s office at Vika Atrium, Munkedamsveien 45 (Entrance A, 5th floor), N-0250 Oslo.
In 2016 and continuing in 2017, Nordic Mining and the associated company Keliber have a high activity level related to value increasing milestones in connection with the Engebø rutile and garnet project and the lithium project in Finland.
Engebø rutile and garnet project
- Comprehensive comminution and process test work
Various test work related to recovery of rutile and garnet is ongoing or has been completed in connection with the pre-feasibility study (PFS). For recovery of rutile, comprehensive processing tests have been carried out by magnetic, gravimetric and electrostatic separation. Flotation tests will be carried out with the target to test alternative process routes and optimise product quality. Also variability tests will be executed to test the flow sheet for variations in ore feed.
With increased garnet sales estimates, garnet recovery has become increasingly important. Additional test work will be carried out to optimise production of coarse and fine garnet qualities for various applications.
- JORC compliant resource base
The revised resource model presented in September 2016 with estimated resources in the measured and indicated resource classes, as defined in the JORC code, will be the basis for the PFS. Mine planning for the open pit and the subsequent underground operation is ongoing. The open pit scheduling and the applied mining methods underground will be optimised for a safe, robust and financially sound project. The estimated resources in the inferred category, as defined in the JORC code, represent a substantial potential which will be further evaluated and explored.
- PFS completion in Q3 2017
The importance of the ongoing test work program as well as certain practical implications related to the broad geographical spread of the activities is challenging with regard to the overall time table for the pre-feasibility study. As high quality in all aspects of the study has the highest priority, completion of the PFS has been rescheduled to Q3 2017.
- Zoning plan and discharge permit are final
The industrial area plan (zoning plan) and the discharge permit for the Engebø project are approved and final, without possibility for appeals. In January 2017, the EFTA Surveillance Authority (ESA) closed three complaint cases related to Norway’s permitting of the tailings disposal for the Engebø project.
Keliber lithium project
- Positive lithium market development
The lithium market is developing positively and product prices have increased. The demand for lithium in various applications, in particular related to batteries for electric/hybrid vehicles and energy storage is growing fast, and the trend is expected to continue in the coming years. Contract prices for lithium carbonate have generally doubled in 2017 compared to 2016. A tight market balance for battery grade lithium carbonate is expected to continue, and the spot prices in China are reported to be well above the current contract level of USD 13 – 14,000 per tonne.
- Definitive feasibility study ongoing
In March 2016, Keliber completed a positive pre-feasibility study for the lithium project. A comprehensive work program is ongoing related to the definitive feasibility study (DFS) which is aiming to provide a solid foundation for the subsequent project financing to implement the lithium project.
As part of the DFS, various test work has been executed related to optical ore sorting, beneficiation and lithium carbonate production. Technical problems related to material handling in connection with conversion of spodumene concentrate have caused delay in the finalisation of the testing process. The challenges have been fully and successfully solved, but the time line for basic engineering, financial analysis and other tasks in connection with the completion of the DFS is affected. As a consequence, the DFS completion will be in Q3 2017.
- Financing of project development work
In November 2016, Keliber executed an equity issue of approximately EUR 3.0 million. Nordic Mining participated pro-rata to its shareholding.
Keliber has appointed an advisor for corporate finance services. The purpose is to investigate options and carry out transactions in order to position Keliber for the fast-growing development in the lithium industry.
Kvinnherad quartz project
- Independent quartz resource estimates
In February 2016, an independent assessment of the Kvinnherad quartz deposit was completed based on information from the drilling program in 2015. The Competent Persons have estimated significant quartz-containing mineral resources in the inferred and indicated categories. The quartz content varies in the deposit with a substantial part in the massive zone category ( >95% quartz content).
Seabed minerals
- MarMine project
In August/September 2016, an exploration cruise was carried out on the Norwegian part of the Mid-Atlantic Ridge. Mineral samples were collected on selected locations. Mineral analysis and preliminary process test work will be carried out based on the collected samples.
Corporate
- Successful financing rounds
In 2016, Nordic Mining has completed equity issues with gross proceeds of approximately NOK 85.7 million. In addition, a private placement with gross proceeds of around NOK 6.9 million was completed in January 2017. Based on current estimates, Nordic Mining is well funded for the ongoing PSF for the Engebø project and other prioritised activities.
For further information, please contact CFO Lars K. Grøndahl on telephone +47 901 60 941.
Oslo, 21 February 2017
Nordic Mining ASA
Nordic Mining ASA (www.nordicmining.com)
Nordic Mining is a resource company with focus on high-end industrial minerals and metals in Norway and internationally. The Company’s project portfolio is of a high international standard and holds a significant economic potential. The Company’s assets are in the Nordic region.
Nordic Mining is undertaking a large-scale project development at Engebø in Sogn and Fjordane where the Group has rights to a substantial eclogite deposit with rutile and garnet. Permits for the project have been granted by the Norwegian government. Nordic Mining has rights for exploration and production of high-purity quartz in Kvinnherad in Hordaland. Nordic Mining’s associated company Keliber Oy in Finland plans to start mining of lithium bearing spodumene and production of lithium carbonate. Nordic Mining holds exploration rights on the Øksfjord Peninsula in Troms and Finnmark where the Company has discovered a prospective area of sulphide mineralisation. Nordic Mining is also exploring opportunities related to seabed mineral resources.
Nordic Mining is listed on Oslo Axess with ticker symbol “NOM”.