Cadence Minerals second iron ore shipment & operational update from the Amapa Project

Cadence Minerals

Cadence Minerals plc (LON:KDNC; OTC: KDNCY) has provided an operational update on the Amapa, Iron Ore Project, Brazil.


·      Shipping continues at pace – DEV Mineração S.A. (“DEV”) has shipped and sold the second batch of iron ore from the stockpiles.

·      The loading of the 48,670 wet tonnes of iron ore sinter fines (approx. 58% Fe) at Companhia Docas de Santana (“CDSA”) was carried out in record time.

·      R$7.5 million deposited into the judicial account, to be utilised to pay ex-employees and small creditors

·      The remainder of the profit from the first shipment is being utilised as per the Approved Court Petition

·      Key personnel have been engaged, including the head of shipping operations and the previous general manager of mine operations.

·      Re-instatement of operating licenses is progressing with a focus on DEV’s private port concession.


DEV has shipped and sold the second batch of the iron ore from the stockpiles at Santana, Amapa, Brazil. The loading of the 48,670 of the iron ore sinter fines (approx. 58% Fe) at CDSA was completed in record time (60 hours), which bodes well for DEV’s plan to increase the frequency of shipping from CDSA over the coming months.

DEV worked with Indo Sino Pte Ltd (“Indo Sino”) and Cadence to carry out a competitive bid process for the cargo. The buyer is one of the world’s largest globally diversified natural resource companies and a major producer and marketer of commodities.

This shipment was approved via a court petition, details of which can be found here, allowing DEV to export sufficient iron ore to realise a US$10 million profit.

Part Payment of Former Employees and Small Creditors

As part of the Approved Court Petition, DEV undertook that it would pay certain outstanding claims from former employees and small creditors from the net profit of the sale of the iron ore stockpile.

In this regard, DEV has transferred R$7.5 million to the judicial deposit account, representing some three-quarters of the amounts owed. KPMG Brasil will manage the payments to these creditors. Once fully paid, this will mark the completion of a crucial step in the Judicial Restructuring Plan (“JRP”) approved by the creditors on 29 August 2019.The remainder of the profit from the first shipment of Iron Ore (Sinter Fines 58% Fe) is being utilised as per the Approved Petition.


Operations have continued to progress in regard to the recommissioning of the Amapa Project.

Key personnel have been engaged. A new head of shipping operations is now responsible for the efficient and safe movement of the iron ore shipments.

In addition, DEV has engaged a former general manager of mine operations. With over 27 years of operational and managerial experience at various Brazilian iron ore and copper mines, including the Amapa Project, the manager will be responsible for day to day operations at the mine, and will oversee the recommissioning of the asset.

As part of the process for reinstatement of critical concessions and operational licenses, our current focus is on the reinstatement of DEV’s private port concession. In this regard, DEV, IndoSino and Cadence have engaged with the relevant authorities, highlighting the macroeconomics and the local and regional importance of the Amapa Project. To date, feedback has been positive, and we will update the market once further progress has been made.

Essential maintenance and security of the mine tailings dam continues, with cost-effective and incremental improvements ongoing. Having now engaged the previous general manager of mining, we expect this process to accelerate, along with the commencement of the plant engineering and conditioning study, which is an outstanding part of the scoping study on the Amapa Project.

As part of providing reliable iron ore stockpile data, SGS Brasil has been engaged to carry out a re-assay of DEV’s iron ore stockpiles. This, alongside a more accurate volumetric survey, will allow DEV to confidently market the material, and reconcile any variations to historic assays results.

Cadence Minerals CEO Kiran Morzaria commented, “We are pleased and proud that the sale and shipment of the second batch of iron ore from Amapa has completed so quickly. That the customer is once again one of the world’s largest globally diversified natural resource companies is a clear signal that Amapa is very much back in business, with keen demand for its product.”

“On behalf of the Cadence board, our gratitude and appreciation goes out once again to the men and women working to bring Amapa back to life, and who have worked tirelessly to complete this second shipment in a safe and efficient manner. “

Although in line with the Approved Petition, it is nonetheless immensely gratifying to see a substantial amount of Amapa’s outstanding debts to former employees and creditors settled with the shipment sale profits, marking a small step along the road to improving prospects for employment and economic activity in the region.”

Cadence Interest in Amapa Project

In early September 2020, we announced that DEV, Indo Sino and Cadence had agreed in principle to the settlement terms proposed by the secured bank creditors (“Bank Creditors”). The investors and DEV remain in constant communication with the Bank Creditors and all parties are aligned to finalise the agreement. We have been informed of some further delays with two of the banks (based in India), whom are experiencing staff shortages due to the COVID-19 pandemic.

The execution of a settlement agreement with the Bank Creditors would represent the satisfaction of Cadence’s remaining major precondition to make its initial 20% investment in the Amapa Project. Upon completing the conditions and the release of the Cadence escrow monies, Cadence will become a 20% shareholder in the Amapa Project via our joint venture company, which will own 99.9% of DEV.

After this, Cadence will invest a further US$3.5 million to increase its stake to 27% in the Amapa project. Cadence’s investment is conditional on several material pre-conditions, which include the grant of key operating licences.

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