Quarterly Activities Report September 2024
NEWS RELEASE - 17 OCTOBER 2024 - GreenX Metals Limited (ASX:GRX, LSE:GRX) (GreenX or the Company) is pleased to present its Quarterly Activities Report for the period during and subsequent to 30 September 2024.
HIGHLIGHTS
- Arbitration Award
- Subsequent to the quarter end, GreenX was awarded A$490 million in compensation and interest from the successful outcome of the international arbitration claims against the Republic of Poland under both the Australia-Poland Bilateral Investment Treaty (BIT) and the Energy Charter Treaty (ECT).
- Upon satisfaction of the award, it is GreenX’s intention to return the majority of the available cash to shareholders in a timely fashion, after payment of funding and claim related costs of the arbitration and applicable taxes (if any)
- Tannenberg Copper Project
- In August 2024, GreenX entered into a earn-in agreement to earn up to 90% in the Tannenberg Copper Project (Tannenberg) which is a highly prospective sediment-hosted (Kupferschiefer type) copper deposit in Germany.
- The Tannenberg exploration licence covers 272 km2 in the State of Hesse in central Germany, encompassing the historical “Richelsdorf” copper - silver mines.
- Eleonore North Gold Project
- In July 2024, GreenX entered into a revised agreement to acquire 100% of the Eleonore North Gold Project (Eleonore North) located in eastern Greenland.
- Eleonore North has the potential to host a “reduced intrusion-related gold system” (RIRGS) analogous to large bulk-tonnage deposit types found in Canada.
Commenting on the outcome of the Claim, GreenX CEO Mr Ben Stoikovich said “Having received the Tribunal’s decision, management is now focused on satisfaction of the award and maximising the return of capital by GreenX to its shareholders.
The award of A$490 million will continue to accrue interest at approximately 6% per annum based on today’s rates (Sterling Over-Night Interest rate (SONIA) plus 1%) until full and final satisfaction of the award by Poland.
Looking ahead, we view GreenX’s future with great optimism and in conjunction with maximising the return of capital to GreenX shareholders, we remain dedicated to advancing our copper and gold projects in Germany and Greenland. We will continue to update the market regarding the award and legal proceedings in line with the Company’s continuous disclosure requirements.”
SUCCESSFUL ARBITRATION OUTCOME IN DISPUTE WITH POLISH GOVERNMENT
Subsequent to the quarter, GreenX reported a successful outcome of the international arbitration claims (Claim) against Republic of Poland (Poland or Respondent) under both the BIT and the ECT (together the Treaties).
The Company has been awarded:
- approximately £252m (A$490m / PLN1.3bn) in compensation by the Tribunal under the BIT (BIT Award) which includes interest compounded at SONIA plus one percentage point (+1%) compounded annually from 31 December 2019 to the date of the award (7 October 2024). Interest will continue to accrue at SONIA +1% compounded annually until full and final payment by the Respondent.
- approximately £183m (A$355m / PLN 941m) in compensation by the Tribunal under the ECT (ECT Award), which includes interest compounded at the SONIA overnight rate +1% compounded annually from 31 December 2019. Interest will continue to accrue at SONIA +1% compounded annually until full and final payment by the Respondent.
- Both Awards are subject to any payments made by the Respondent to the Claimant in the other arbitration such that the Claimant is not entitled to double compensation i.e., any amount paid by Poland in one arbitration (i.e., ECT) is set off against Poland’s liability in the other arbitration (i.e., BIT).
The compensation is denominated in British pound sterling. No hedging is in place for the compensation and accordingly is subject to fluctuations in foreign currency.
Each party has been ordered to cover its own legal fees, expenses and arbitration costs in relation to the Claim, which in respect of GreenX are costs that have already been fully paid under the Litigation Funding Agreement (LFA) with specialist arbitration funder LCM Funding UK Limited (a subsidiary of Litigation Capital Management Ltd) (LCM).
The Tribunal has unanimously held that Poland had breached its obligations under the Treaties in relation to the Jan Karski project, entitling GreenX to compensation. In respect of the Dębieńsko project, the Tribunal did not uphold the Claim under the Treaties.
All of GreenX’s costs associated with the arbitration were funded on a limitedbasis from LCM. To date, GreenX has drawn down US$11.2 million (A$16.2 million at 30 September 2024) (Outstanding Funding) from the LFA. In accordance with the terms of the LFA, once the compensation is received, LCM is entitled to be paid the Outstanding Funding, a multiple of five times the Outstanding Funding (based on the period since entering into the LFA) and from 1 January 2025, interest on the Outstanding Funding at a rate of 30% per annum, compounding monthly.
Net of the payments to LCM, GreenX will pay 6% of the balance to key management directly involved in the case (as previously approved by shareholders on 20 January 2021) and 3% to key legal advisers who assisted with the case on a reduced and fixed fee.
Upon satisfaction of the award, it is GreenX’s intention to return the majority of the available cash to shareholders in a timely fashion, after payment of the above costs of the arbitration and applicable taxes (if any).
The Claim was brought under the United Nations Commission on International Trade Law Rules (UNCITRAL) and the Awards are final and binding on the parties. The UNCITRAL Rules do not provide for an appeal procedure i.e., grant no explicit authority to a panel to reconsider its award. Under the UNCITRAL Rules, either party may, within 30 days of receiving an award, ask the Tribunal to correct any computational, clerical or typographical errors in the award, issue an interpretation of the award or render an additional award on any claims omitted from the final award. These procedures do not allow either party to request that the Tribunal reconsider the merits of its decision.
If a party believes that an award ought to be “set-aside” or “annulled”, then that party must apply for relief from a court where the arbitration was seated, which would be the national courts of England and Wales for the BIT claim and Singapore for the ECT claim. Poland has 28 days from the date of the BIT Award and three months from receiving the ECT Award to apply for set aside of the respective Awards, which can only be set aside under limited circumstances. These time limits may be extended if there is an application for correction or, in the case of the BIT claim, with the permission of the English courts. It is important to note that a “set-aside” motion is different from a general “appeal” since a set-aside motion can in general only relate to a lack of jurisdiction on the part of the Tribunal or procedural unfairness, unlike an appeal, where the actual merits of a case might be revisited by a court. In summary, Poland cannot initiate any post award proceedings to re-examine the Tribunal’s decision on the merits of the case. The threshold to succeed on a “set-aside” motion in either the Singapore or English domestic courts is high, with courts in both jurisdictions rejecting set-aside applications in the vast majority of cases.
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ENQUIRIES
Ben Stoikovich
Chief Executive Officer
+44 207 478 3900
Sapan Ghai
Business Development
+44 207 478 3900
—ENDS—
Forward Looking Statements
This release may include forward-looking statements. These forward-looking statements are based on GreenX’s expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of GreenX, which could cause actual results to differ materially from such statements. GreenX makes no undertaking to subsequently update or revise the forward-looking statements made in this release, to reflect the circumstances or events after the date of that release.
Competent Persons Statement
The information in this report that relates to exploration results were extracted from the ASX announcements dated 15 July 2024 and 2 August 2024 which are available to view at www.greenxmetals.com.
GreenX confirms that (a) it is not aware of any new information or data that materially affects the information included in the original announcement; (b) all material assumptions and technical parameters underpinning the content in the relevant announcement continue to apply and have not materially changed; and (c) the form and context in which the Competent Person’s findings are presented have not been materially modified from the original announcement
This announcement has been authorised for release by the Company’s Chief Executive Officer, Mr Ben Stoikovich.
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