Euro Manganese releases quarterly, with cash balance update
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Our European battery metals Investment, Euro Manganese (ASX:EMN) released its quarterly reports today, which summarised its significant progress to date.
EMN is developing a High Purity Manganese project in the European Union (Czech Republic) through the recycling of a tailings resource - and we’re pleased with this quarter’s progress.
We’re hoping EMN can seal an offtake and secure financing for the project in the coming year.
Our key highlights from the quarterly include:
- Commissioning of Demonstration Plant underway, samples expected in Q1 2023 - this was a big one for us as we believe it will be an important precursor to an offtake agreement - read all about the importance of the Demonstration Plant here.
- Cash balance of CAD$21.6M ($23.6M) at 30 September 2022 - this should fund operation of the Demonstration Plant for a year, more land acquisitions, potentially some future construction of infrastructure and facilities for EMN’s project and the progress of the Company's North American strategy - a key pillar of EMN’s appeal after the Inflation Reduction Act laid out incentives for domestic production of battery materials.
- EPCM tender process - to get the project going, EMN needs to put out a tender for construction of the commercial processing plant. EMN is looking at bids from “five tier 1 EPCM firms” and expects the tender to be awarded in Q1 2023
- Life Cycle Assessments - EMN’s High Purity Manganese project has been shown to not only improve the environment by remediating a tailings deposit - it has a carbon footprint of roughly one-third of the China-based incumbent industry (China makes 95% of the world’s High Purity Manganese). A win for both the environment and EMN’s ESG credentials.
- Appointment of VP Commercial - another McKinsey alumni joins EMN, Dr. James Fraser. Given Dr. Fraser’s background in the automotive industry, geoscience, mining and consulting - we expect his commercial acumen to be very valuable to EMN, particularly around offtake negotiations. A big win for EMN.
- Delivery of DFS - EMN delivered a DFS this quarter which we covered in August. It outlined an after-tax Net Present Value (NPV) that sits at US$1.34B ($1.92B) and US$757.3M (~$1.1B) with an internal rate of return of 21.9% and a 4.1 year pay back period. We think these numbers will be good enough for EMN to go out and secure project financing from a range of stakeholders with a mix of debt and equity.
All up, this was a good quarterly from EMN and we think there’s plenty to look forward to in the coming year from EMN.
The company is looking to not only shore up domestic European supply of High Purity Manganese, but also make inroads into what could be a lucrative North American battery metals market.
For those interested, you can also catch the EMN quarterly update call tomorrow at 9AM AEDT:
We’ll be listening in on that - it should be a good update ahead of a busy year for EMN in 2023.