Uranium Project Option Agreement Update

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

This announcement is for information purposes only and is not a prospectus and not an offer of securities for sale in any jurisdiction, including in the United States, Australia, Canada, Japan and South Africa.
 

27 March 2019

MetalNRG plc

(The "Company" or “MetalNRG”)

Option Agreement update on Uranium Project and Notification of proposed admission to the Official List and cancellation of trading on the NEX Exchange Growth Market

MetalNRG plc (NEX:MNRG) today announces that it has replaced the terms of the option agreement (the “Original Option Agreement”) announced on 16 August 2018, and the amendment to the Original Option Agreement (the “Amended Option Agreement” and, together with the Original Option Agreement, the “Option Agreement”) announced on 24 January 2019 with International Mining Company Invest Inc ("IMC"), in relation to the Kamushanovskoye uranium deposit in Kyrgyzstan (the “Uranium Project”) with the terms set out herein.  

The Option Agreement has been replaced with a farm-in agreement (the “Farm-in Agreement”), the terms of which are outlined below.

The Farm-in Agreement enables MetalNRG to fund access to additional licence areas within the Uranium Project, which is intended to increase the overall resources of the Uranium Project, reduce the immediate payment required to secure 51% of the Uranium Project (as contemplated under the Option Agreement) and defer certain payments to ensure appropriate funding is in place for the further design and development of the Uranium Project.

Under the Option Agreement, MetalNRG has already paid US$160,650 to IMC in connection with the Uranium Project (the “Initial Payment”). These funds have been used to ensure successful conversion of the exploration licence into a mining licence. The Farm-in Agreement requires MetalNRG to transfer US$400,000 to IMC on or around 10 April 2019 (the “Second Payment”). The Second Payment shall represent an entitlement to an economic interest of 51% in the assets and operations being the subject of the mining licence held by IMC over the Uranium Project.

In order to maintain entitlement to the 51% economic interest, MetalNRG has committed to pay IMC a further US$1,989,350 over 18 months, with all such funds going towards an agreed work and development programme at the Uranium Project.

The Farm-in-Agreement calls for the US$1,989,350 to be paid as follows:

    --  US$663,117 shall be payable in November 2019,
    --  US$663,117 shall be payable in April 2020; and
    --  US$663,117 shall be payable in October 2020.

MetalNRG has a right of first refusal over any offer that IMC may make to any third party investors to obtain additional project finance in relation to the Uranium Project. If MetalNRG elects to provide funding equal to the amount of any project finance offer from a third party, upon such funds being received by IMC, MetalNRG and IMC shall commit to increase MetalNRG’s economic interest in the Uranium Project by way of further agreement at a date to be agreed between the parties. 

If MetalNRG cannot satisfy any of the above-mentioned payments, the right of first refusal shall not apply. Following any default on any payment to IMC by MetalNRG, IMC shall have the right, subject to approval by MetalNRG, to enter into project finance arrangements  with third party investors in relation to the Uranium Project, and MetalNRG and IMC shall commit to re-distributing the economic entitlement over the Uranium Project (by reference to the then-prevailing market value of the Uranium Project) by way of further agreement accordingly at a date to be agreed between the parties.

In addition, MetalNRG is in the process of applying for admission to listing of its ordinary shares of nominal value 0.01 pence each (the “Ordinary Shares”) on the standard listing segment of the official list (the “Official List”) of the Financial Conduct Authority and admission to trading on the main market for listed securities of London Stock Exchange plc (together, “Admission”).

The Second Payment is conditional on the proposed capital raise by MetalNRG in connection with Admission.

Pursuant to Rule 81 of the NEX Exchange Growth Market Rules for Issuers, MetalNRG is not required to release a circular to its shareholders to obtain shareholder approval as it has made an application for the admission of the Ordinary Shares to the Official List. MetalNRG has given notice to NEX of its withdrawal.

Rolf Gerritsen, CEO of MetalNRG, commented "The Farm-in Agreement enables us to reduce our initial cash outlay, increase the money that goes towards the development of the Uranium Project and progressing it towards production, while increasing our exposure to additional licence areas. Moreover, our proposed admission to the Official List and main market is intended to simultaneously raise the global profile of MetalNRG, increase its trading liquidity and provide the Company with a larger range of potential investors.  I look forward to updating the market on our progress as we add value and move towards production with this exciting project and the proposed move to the Official List."

The directors of the Company accept responsibility for the contents of this announcement.

For further information, please contact:


MetalNRG PLC
Rolf Gerritsen (Chief Executive Officer) +44 (0) 20 7796 9060

NEX Exchange Corporate Adviser
PETERHOUSE CAPITAL LIMITED
Guy Miller/Mark Anwyl                    +44 (0) 20 7469 0930

Corporate Broker
SI CAPITAL
Nick Emerson                             +44 (0) 1483 413500



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