Firering Strategic Minerals plc (LON:FRG), a development company specialising in critical minerals, has announced its Interim Results for the six months ended 30 June 2024.
OVERVIEW
Focused on advancing quicklime asset in Zambia having raised c.£2 million of equity funding in May:
· Fully permitted, project with an estimated resource of 73.7 million tonnes (Mt) at 95.3% CaCO3.
· On track to start phased production in Q4 2024 and ramp up to full capacity by mid-2025 to become one of the largest quicklime producers in the region.
· Strategic decision driven by quicklime’s strong alignment with the robust copper market.
Limeco is already generating positive cash flow:
· Sales of aggregate commenced in October 2023.
· Two-year logistics services revenue agreement signed in August 2024.
· Other ancillary revenue streams expected to come online in due course.
Enhancing Limeco’s strong economic foundation:
· Currently targeting daily production of 600-800 tonnes of quicklime projected to sustain operations for around 30 years.
· Granted an additional exploration licence, which could expand existing Mineral Resource Estimate by an additional 60 to 70Mt of similar-grade material.
Progress in advancing the Atex Project in north-west Côte d’Ivoire:
· Expanded known lithium mineralisation 122% following first reverse circulation campaign in March 2024.
CHAIRMAN’S STATEMENT
During the period, we have focused on advancing our quicklime asset in Zambia, which presents immediate cash flow prospects and significant growth potential. This strategic decision, driven by quicklime’s strong alignment with the robust copper market, will, we envisage, deliver considerable value creation for our shareholders.
Since raising approximately £2 million at the end of May to acquire an initial 10% stake in Limeco Resources Limited (Limeco), with the option to increase it to 45%, and to fund the recommissioning and ramp-up of the lime plant’s operations, the pace of progress has been remarkable. Bolstered by an estimated resource of 73.7 million tonnes (Mt) at 95.3% CaCO3 and a limestone stockpile of 190,000 tonnes ready to initiate production, this exciting, fully permitted project is on track to start phased production in Q4 this year.
At the time of our investment, the project was in an advanced stage having seen historical investment exceeding US$100 million. However, ahead of recommissioning, Limeco has spent the past few months enhancing the crushing circuit to produce the ideal limestone size for the kilns and changing the fuel source from heavy fuel oil to coal gasification to deliver more economical heating energy. Concurrently, the on-site laboratory has been recommissioned and testwork has begun with high purity levels of calcium oxide (quicklime) achieved in line with the specifications required by our potential off takers.
Importantly, even before the start of core quicklime production, Limeco is generating positive operational cash flow with the sale of aggregate, which commenced in October 2023, and a two-year logistics services revenue agreement signed in early August 2024. Other ancillary revenue streams are expected to come online in due course such as the sale of ash from the coal gasification process to the cement industry.
Setting the stage for scaling Limeco’s capacity to align with Zambia’s ambitious target to increase copper output to 3Mt by 2031, Limeco applied for and was granted an additional exploration licence on 3 September 2024. This new licence, located adjacent to its existing licence, will potentially increase Limeco’s significant Mineral Resource by 60 to 70Mt of similar-grade material. This will enhance the project’s already strong economic foundation, which is currently based on the daily production of 600-800 tonnes of quicklime, projected to sustain operations for around 30 years.
In addition to our quicklime asset, we made progress in advancing the Atex Project in north-west Côte d’Ivoire, successfully expanding the known lithium mineralisation by 122% following our first reverse circulation campaign in March 2024.
Our ability to remain agile and seize opportunities has put us in a strong position. Through strategic focus and disciplined execution, we are unlocking significant value from our quicklime asset while advancing our lithium project. The next few months will be pivotal as Limeco’s project comes online and is ramped up to full capacity throughout 2025 to become one of the largest quicklime producers in the region.
I would like to extend my thanks to our shareholders for their ongoing support and confidence in our vision and look forward to updating the market as we reach key milestones in the coming months.
Youval Rasin
Non-Executive Chairman, Firering Strategic Minerals
