MetalsTech Limited: June 2020 Quarterly Activities Report

MetalsTech Limited (ASX: MTC) is pleased to report its activities for the quarter ended 30 June 2020.

HIGHLIGHTS

JORC (2012) Mineral Resource Estimate

-          JORC (2012) Mineral Resource Estimate for Sturec:

-          21.2Mt @ 1.50 g/t Au and 11.6 g/t Ag, containing 1.026Moz of gold and 7.94Moz of silver of which 67% is Indicated and Measured Resource Category using a 0.4g/t Au cut-off and within an optimised open pit shell; and

-          388kt @ 3.45 g/t Au and 21.6 g/t Ag containing 43koz of gold and 270koz of silver, of which 71% is Inferred Resource Category using a 2.85g/t Au cut-off (outside the optimised open pit shell) on an underground mining basis

-          based on 90.5% gold recovery rates on Sturec mineralisation using ammonium thiosulphate processing technology without the use of cyanide

-          Deposit is open to the north and south along strike, as well as down-dip and plunge, indicating significant exploration upside and ready drill targets

-          High-grade core of the known mineralisation plunges south into an undrilled zone, which will be the focus of resource expansion drilling

Metallurgical Testing Program

-          MTC partnership with Clean Earth Technologies for use of proprietary cyanide-free thiosulphate-based gold recovery technology at the Sturec Gold Project

-          The Company continues to mine and extract ore from the Andrej Adit under its recently awarded underground mining licence, with ore being shipped to Australia for bulk metallurgical testing covering conventional gravity separation, flotation, heavy liquid separation (HLS) and thiosulphate-based gold extraction technology

Underground Diamond Drilling Program

-          Underground diamond drilling has commenced from within the Andrej Adit at the Sturec Gold Mine

-          Exploration will include up to nine (9) diamond drill holes totalling approximately 3,000m and will focus on potential resource expansion

-          Drilling will follow up STOR 3.11 which intersected:

-          89.0m @ 6.9g/t Au and 23.6g/t Ag from 114m to 203m down hole using a 3g/t Au cut-off

within a broader intersection of

-          137.3m @ 4.6g/t Au and 16.5g/t Ag from 67.7m to 205m down hole using a 0.3g/t Au cut-off

-          Results from the current drill program will feed into the underground mine scoping study, which is expected to include as a first stage of operations, a simple and low CAPEX gravity separation and flotation concentrate operation with a shorter timeline to production

-          The gold sector is booming and to capitalise on this the Company is looking to fast-track production at Sturec – the Company has accelerated the completion of a scoping study for a simple, high-grade underground mine that takes advantage of the existing Sturec infrastructure, mine workings and existing underground mining licence which was awarded to the Company in April 2020

Consolidation of Share Register

-          Industrial chemicals manufacturer Wuxi Baichuan Chemical Industrial Co Ltd (BCC) divests of its remaining 7,790,000 share stake in MTC in a $1.4 million bookbuild and sell down completed at 18c per share to institutional and sophisticated investors

-          The Bookbuild was completed at a price of 18 cents per share representing a 27% premium to the 5-day VWAP and a 19% premium to the 10-day VWAP

-          The Bookbuild was subscribed for by institutional and sophisticated investors, unrelated to the Company and was managed by the Company

Appointment of Technical Advisor and Board Changes

-          Mark Calderwood joins MetalsTech as Technical Advisor to assist the Company with its development of the Sturec Gold Project in Slovakia – he is a member of the Australasian Institute of Mining and Metallurgy and has more than 25 years' experience in exploring and mining gold

-          Mr Calderwood successfully led Persues Mining Limited as Managing Director and over 9 years, facilitated its transition from IPO to gold producer and an ASX100 company with a market capitalisation of > $1.6 billion

-          Mr Noel O’Brien resigns as Non-Executive Director and is appointed a Technical Advisor (Metallurgy & Processing)

-          Together with the recent appointment of Mr Mark Calderwood as a Technical Advisor to the Company, Mr O’Brien’s transition to a formal technical consulting role is in keeping with the Company’s strategy to strengthen its technical capability as it seeks to advance development of the 100% owned Sturec Gold Mine

Funding

-          Strategic Finance Agreement signed with existing MetalsTech financier Mr Zhengrong Chen for further investment by way of fixed price convertible notes (Notes)

-          Key terms of the Notes include:

-          $2.5 million investment through the issue of 10,000,000 Notes (Notes will be issued under the Company’s existing placement capacity pursuant to ASX Listing Rule 7.1)

-          secured against MTC’s non-core Cancet Lithium Project

-          two-year term

-          interest rate of 10% p.a.

-          fixed conversion price of 25 cents per share and MTC may force conversion under certain conditions

-          12 months escrow on shares following conversion

-          Finalisation of the Notes are subject to internal and external regulatory approvals of the parties and approval by MTC shareholders (if required)

-          Completion of Sophisticated Investor Placement (Placement) of $1,125,000 through the issue of 7,031,250 fully paid ordinary shares at 16 cents per share (Shares allotted under the Company’s existing placement capacity pursuant to ASX Listing Rule 7.1A)

-          Directors (and/or their nominees) to participate in the Placement and invest $150,000 on the same terms as the Placement, subject to shareholder approval

-          MTC is funded to achieve its objectives at the Sturec Gold Mine for 2020 which include resource expansion drilling, scoping study covering conventional gravity separation, flotation, heavy liquid separation (HLS) and thiosulphate-based gold extraction technology

Other

-          During the Quarter ended 30 June 2020, Executive Chairman Mr Russell Moran presented at the NWR Resources Virtual Conference

Background: Sturec Gold Mine

The Sturec Gold Mine is located in central Slovakia between the town of Kremnica and the village of Lučky, 17km west of central Slovakia's largest city, Banská Bystrica, and 150km northeast of the capital, Bratislava.

Sturec contains a total Mineral Resource of 21.2Mt @ 1.50 g/t Au and 11.6 g/t Ag (1.59g/t AuEq) using a 0.4g/t Au cut-off and within an optimised open pit, containing 1,026,000 ounces of gold and 7,944,000 ounces of silver (1,086,000 ounces of gold equivalent) in accordance with JORC (2012). An additional 388,000 tonnes at 3.45 g/t Au and 21.6 g/t Ag (3.60g/t AuEq) outside the optimised open pit contains an additional 43,000 ounces of gold and 270,000 ounces of silver (45,000 ounces of gold equivalent), reported in accordance with JORC (2012).

Table 1: Mineral Resource Estimate - Sturec Gold Project

 AuEq g/t = ((Au g/t grade*Met. Rec.*Au price/g) + (Ag g/t grade*Met. Rec.*Ag price/g)) / (Met. Rec.*Au price/g)

Long term Forecast Gold and Silver Price USD/oz (source: World Bank, JP Morgan): $1,500 and $20 respectively.

Gold And silver recovery from the 2014 Thiosulphate metallurgical test work: 90.5% and 48.9% respectively.

It is the Company’s opinion that both gold and silver have a reasonable potential to be recovered and sold from the Sturec ore using Thiosulphate Leaching/Electrowinning as per the recoveries indicated.

ENDS

For further information, contact:

Russell Moran     

Chairman     

M +61 415 493 993    

[email protected]   

Nathan Ryan

Investor Relations

M +61 420 582 887

[email protected]

Gino D’Anna

Director 

M +61 400 408 878

[email protected]

Caution Regarding Forward-Looking Information

This document contains forward-looking statements concerning MetalsTech. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward-looking statements as a result of a variety of risks, uncertainties and other factors. Forward-looking statements are inherently subject to business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company’s actual results to differ materially from those expressed or implied in any forward-looking information provided by the Company, or on behalf of, the Company. Such factors include, among other things, risks relating to additional funding requirements, metal prices, exploration, development and operating risks, competition, production risks, regulatory restrictions, including environmental regulation and liability and potential title disputes.

Forward looking statements in this document are based on the company’s beliefs, opinions and estimates of MetalsTech as of the dates the forward-looking statements are made, and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments.

Competent Persons Statement

The information in this announcement that relates to Exploration Results is based on information compiled by Dr Quinton Hills Ph.D., M.Sc., B.Sc. Dr Hills is the technical advisor of MetalsTech Limited and is a member of the Australasian Institute of Mining and Metallurgy (No. 991225). Dr Hills has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Dr Hills consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

The information in the report to which this statement is attached that relates to Mineral Resources for the Sturec Gold Deposit is based on information compiled by Mr Chris Grove, who is a Member of The Australasian Institute of Mining and Metallurgy (No. 310106). Mr Grove is a full-time employee of Measured Group Pty Ltd and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Grove consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.