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    EMH   AU000000EMH5

EUROPEAN METALS HOLDINGS LIMITED

(EMH)
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European Metals : Quarterly Activities/Appendix 5B Cash Flow Report

07/29/2021 | 07:59pm EDT

30 July 2021

QUARTERLY ACTIVITIES REPORT - JUNE 2021

European Metals Holdings Limited (ASX & AIM: EMH, NASDAQ: EMHXY) ("European Metals" or the "Company") is pleased to provide an update on its activities during the three-month period ending 30 June 2021 which highlights the continued progress in the development of the globally significant Cinovec Lithium/Tin Project ("the Project" or "Cinovec") in Czech Republic.

The quarter was marked with positive and encouraging results from locked cycle testwork, the lodging of the Environmental Impact Assessment submission, significant advances in the formal assessment of the Project's environmental credentials and continued successful drilling programme. The Company also announced its intentions to list its securities in the US via the NASDAQ ADR programme.

From a macro perspective, the market for and price of lithium improved significantly throughout the quarter. The Company expects this improvement to continue.

ENVIRONMENTAL IMPACT ASSESSMENT

On 6 May 2021 the Cinovec Project company Geomet s.r.o submitted the documentation related to the initial EIA notification to the Czech Ministry of the Environment.

The submission officially initiates the environmental impact assessment process of the Cínovec project. The Ministry of Environment launched a screening procedure, including the notification of all concerned stakeholders. During this time, the Ministry assesses the submitted documentation, comments of all stakeholders in the proceedings and decides whether it will be necessary to prepare additional studies. Following European and Czech environmental legislation the submission also included an independent expert assessment of Natura 2000 (the European Union's network of nature protection areas) which concluded that there is no negative impact on proximate nature reserves or any other sites of natural importance.

STRONG RESULTS FROM LOCKED-CYCLE TESTS

On 19 May the Company announced successful locked-cycle test ("LCT") results, further supporting the Cinovec project's credentials to produce battery-grade lithium chemicals.

The highlights of the announcement were -

  • European Metals demonstrated that Cinovec battery grade lithium carbonate can be easily converted into lithium hydroxide monohydrate with a commonly utilised liming plant process.
  • Six LCTs were planned but testwork was stopped after four cycles as the main process stream compositions had been successfully stabilised.

CDI'S ON ISSUE 175.4M

30 July 2021

  • Battery grade lithium carbonate was produced in every LCT with lithium recoveries of up to 92.0% achieved in the four LCTs performed.
  • The LCTs tested zinnwaldite concentrate from the southern part of Cinovec, representative of the first five years of mining.
  • Improved fluoride removal process step further enhances project's economic outcomes because of the regeneration and reuse of the ion exchange resins.
  • Further optimisation work in hydrometallurgy processing steps is expected to improve lithium recoveries from concentrate to >92.0%.

LOCKED-CYCLE TEST RESULTS PROVE ABILITY TO PROCESS ZINNWALDITE

Geomet commissioned the LCTs with the principal objective of confirming the flowsheet for the processing of zinnwaldite concentrate from Cinovec run-of-mine ore. The LCTs differ from previous proof of concept and optimisation testwork conducted during the Cinovec PFS by confirming the effect of recycle streams (which carry some lithium and other alkali metals) on the overall recovery of lithium from the pregnant leach solution resulting from the water leaching of the roasted zinnwaldite concentrate and the ability to produce battery grade lithium carbonate. The LCTs have been performed by Dorfner Anzaplan, Germany and have been supervised by Lithium Consultants Australasia and SMS group Processing Technologies GmbH ("SMS") in parallel with the FrontEnd Engineering Design ("FEED") programme being undertaken by SMS. The LCTs have processed zinnwaldite concentrate from drill core samples taken from the southern part of the Cinovec orebody, representing ore that will be processed in the first five years of the mine plan. The recovery of up to 92% of the lithium in the concentrate sample compares favourably with the similar recovery in the PFS flowsheet of 91%. However, this new recovery of up to 92% is before lithium plant DFS/FEED optimisation testwork that will be targeted in specific process areas and which is expected to increase hydrometallurgical recovery in the lithium plant to more than 92%. Separate metallurgical testwork on the Front-End Comminution and Beneficiation ("FECAB") circuit is underway and is designed to improve upon the lithium recovery of 90% from ore to concentrate. This testwork will be reported at a later date.

PROOF OF PROCESSING STEPS FOR REMOVAL OF FLUORIDE, POTASSIUM AND RUBIDIUM

Ahead of the LCTs, Geomet tested an alternative process to remove fluoride in order to meet the EV grade specification of <50ppm in the lithium carbonate. The PFS flowsheet included the removal of fluoride by the use of activated alumina, a relatively costly step because the activated alumina was not considered suitable for regeneration. This step has been replaced by a cheaper and more environmentally friendly two-step process involving chemical precipitation and ion-exchange. This new method of fluoride removal has been proven to be highly effective, easier to implement and is less costly as the ion-exchange resin can easily be regenerated and re-used many times.

The zinnwaldite mica at Cinovec contains alkali metals other than lithium, including potassium, rubidium and caesium, which are leached into solution and will build up in the plant if not removed from the circuit.

The LCTs have proven conclusively that the unwanted alkali metals can be removed preferentially by control of temperature, pH, solution saturation and crystallisation. It has been confirmed that these alkali metals will not build up due to recycles within the plant. The achievement of this within four LCTs with minor loss of lithium is a major step towards confirmation of process plant design.

LITHIUM HYDROXIDE PRODUCTION

The current LCTs have been commissioned to confirm the lithium carbonate processing flowsheet. The Cinovec Project has optionality to either produce a battery grade lithium carbonate product or to further process the lithium carbonate to produce battery grade lithium hydroxide.

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30 July 2021

As the FEED programme continues, Geomet is expected to commission testwork to confirm the optimal production route for lithium hydroxide and to produce marketing samples for prospective offtake partners and environmental samples to assist in permitting approvals.

ADOPTION OF ESG REPORTING AND ENGAGEMENT OF LITHIUM LIFE CYCLE ASSESSMENT SPECIALIST

The Company believes that the Cinovec Project will have very strong ESG credentials and a low carbon footprint relative to its peers. As part of the Company's commitment to developing the Project with this very strong environmental focus, two key environmental consultants were engaged during the period.

On 10 May 2021 the Company announced the adoption of a set of Environmental, Social and Governance ("ESG") metrics and disclosures following the recommendations released by the World Economic Forum ("WEF") in Geneva, Switzerland which are acknowledged as the gold standard for ESG reporting.

The highlights of this announcement are as follows -

  • Establishment of an ESG Committee at Board level, to be chaired by Ambassador Lincoln Bloomfield who has considerable private sector experience centred on sustainability, resilience and renewable energy
  • Engagement of Socialsuite ESG technology platform - a global leader in ESG impact management systems and sustainability reporting
  • Initiation of ESG reporting, monitoring and improvement for European Metals utilising Socialsuite
  • EMH's ESG transparency commitment is a precursor to an independent lithium production Life Cycle Assessment2 ("LCA") which includes a full Carbon Footprint assessment

ADOPTING AN ESG FRAMEWORK

ESG and impact investing have become key criteria for both investors and fund managers, leading a new path to how companies are being assessed. In 2020, 33% of the US$51.4 trillion in total US assets under professional management used ESG investment criteria, with demand for ESG compliance continuing to rise sharply with total Global sustainable investment now topping $30 trillion-up 68% since 2014 and tenfold since 2004. The acceleration has been driven by heightened social, governmental, and consumer attention on the broader impact of corporations, as well as by the investors and executives who acknowledge that a strong ESG proposition is a key indicator of a company's long-term success. ESG reporting offers a tool and roadmap for investors and society to hold companies to account, to make sure that the issues such as climate change, social justice, equality, diversity and environmental protection are reflected and appropriately addressed by the company in focus.

EMH BASELINE ESG DASHBOARD

The Company has deployed Socialsuite's ESG technology platform to set its initial ESG baseline in its first quarterly ESG dashboard. With a tailored action plan, the Company will focus on delivering and reporting ongoing progress toward disclosing and improving ESG metrics and indicators. Socialsuite's ESG reporting technology provides an easy way for investors and other stakeholders to assess the commitment and progress of the Company on its journey to create "best in class" ESG credentials and outcomes.

Page 3 of 13

30 July 2021

BACKGROUND TO WORLD ECONOMIC FORUM REPORTING GUIDELINES

Before choosing an investment or purchase, all stakeholders want to be assured businesses are truly "walking the ESG walk" and not just "ESG washing". However, the key challenge for many companies is the lack of a universal and consistent framework to measure and report the shared and sustainable value it creates. During 2019, the World Economic Forum's International Business Council ("IBC"), flagged the existence of multiple ESG reporting frameworks and the lack of consistency and comparability of metrics as major issues preventing companies from credibly demonstrating to all stakeholders its progress on sustainability and its contributions to the sustainable development goals. In collaboration with Deloitte, EY, KPMG and PwC, the IBC worked to identify a set of universal, material ESG metrics and recommended disclosures that could be reflected in the mainstream annual reports of companies on a consistent basis across industry sectors and countries. The metrics were designed to be capable of verification and assurance, to enhance transparency and alignment among corporations, investors, and all stakeholders. The result of this process is a set of 21 core and 34 expanded metrics and disclosures, which have been adopted by Socialsuite in its ESG reporting platform to help companies such as European Metals effortlessly and instantly commence ESG reporting.

ABOUT SOCIALSUITE

Socialsuite is a fast-growing global company based in Melbourne, Australia. It has clients across Asia Pacific, the Americas and Europe. Its clients include financial institutions, large companies, government agencies, philanthropic foundations, not-for-profits and NGOs that want to monitor and fully understand how they impact people and the environment. As a global leader in impact management systems, Socialsuite delivers an efficient and rigorous measurement and monitoring service that is simple to use, infinitely adjustable and tailored to European Metals' requirements. Its automated data-collection, analysis and reporting tools provide accurate and timely insights to allow European Metals to monitor and understand the impact of the Company's initiatives. Socialsuite's impact monitoring technology provides structured ESG data collection, ongoing ESG reports that can be directly inserted into quarterly reports, benchmarking across other similar companies' ESG journeys and expanding ESG reporting depth/complexity as the company grows over time. Socialsuite provides a clear and practical way businesses can get started with ESG measurement based on the company's size and resources, which can be scaled and extended as capacity increases. It uses the World Economic Forum's 21 material ESG metrics and records "ESG Progress velocity" from quarter to quarter, enabling businesses to measure, track and report progress toward the ESG indicators. The benefits of ESG compliance for small to medium listed companies are significant, which is why the first cohort of ESG reporters have been so quick to pioneer ESG compliance in Australia by beginning to measure progress and demonstrate its credentials. A technology platform like Socialsuite combined with the new WEF ESG metrics has made gold standard ESG reporting accessible and easily understandable.

ENGAGEMENT OF LCA SPECIALIST

As highlighted in the above announcement, the Company's ESG transparency commitment was a precursor to an independent lithium production Life Cycle Assessment ("LCA") which would include a full Carbon Footprint assessment.

On 10 June 2021 the Company announced the appointment of that specialist. The highlights of the announcement were -

  • UK-basedand globally recognised sustainability and life cycle assessment consultancy,
    Minviro, engaged to provide an ISO compliant life cycle assessment ("LCA") of the Cinovec lithium / tin project.

Page 4 of 13

30 July 2021

  • Cinovec LCAs to be produced for both battery-grade lithium carbonate and battery-grade lithium hydroxide monohydrate which will be manufactured at a lithium chemical plant nearby to the Cinovec mine.
  • Cinovec LCAs will be benchmarked against global lithium peers.
  • Minviro has been actively engaged to identify low-carbon optimisations in the developing feasibility study for Cinovec.
  • Cinovec LCAs expected to demonstrate strong carbon footprint credentials with lower energy use, less intensive reagent application and net carbon credits from mine and process by-products.
  • LCA Report anticipated to be completed and provided to the Company in Q3 2021.

LOW CARBON LITHIUM FROM CINOVEC

Geomet is committed to delivering a low carbon footprint, high quality lithium product for cathode and battery manufacturers. The work that will be conducted by Minviro will help Geomet understand how to best achieve this and how the Cinovec project compares against hard-rock [and brine] lithium peers. The International Organisation for Standardisation ("ISO") has a set of standards published on Life Cycle Assessment ("LCA") (ISO 14040 and 14044). The standards outline the best practice requirements and principles to be undertaken for a LCA study. ISO compliance includes a third-party review by an independent panel of experts. The results are then allowed to be disclosed publicly and used for comparison with different primary production methods of raw materials. This will provide the Cinovec project with an independently-verified carbon assessment that is recognised by financiers and potential off-takers.

ABOUT MINVIRO

Minviro (www.minviro.com) is a London based and globally recognized consultancy and technology company specialised in carrying out life cycle assessments in the technology metal space. The company provides quantitative environmental and climate impact data for mineral resource projects, battery manufacturers and OEMs to make environmentally informed decisions. Minviro Ltd has recently completed, or are engaged for LCA assessments, for various processes and products being developed in the battery raw materials markets. Minviro will use data generated from the pre- feasibility study of the Cínovec Project. The LCA includes a cradle-to-gate life cycle inventory and life cycle impact assessment for five impact categories including carbon footprint, alongside recommended impact mitigation opportunities. The results will be delivered to the Company in the form of an ISO-compliant and third-party reviewed Life Cycle Assessment (LCA) Report.

EMH ADS TO TRADE IN THE U.S.

On 18 June 2021 the Company announced its intention to expand its presence in the U.S. with Deutsche Bank appointed as the depositary bank for EMH's American Depositary Shares.

Highlights -

  • EMH and Deutsche Bank establishing a sponsored Level 1 ADS program with each ADS representing 20 EMH Chess Depositary Instruments
  • ADSs expected to commence trading on the OTC Market as a member of the Nasdaq International Designation during July 2021 under the ticker symbol "EMHXY".
  • Extensive marketing campaign to begin to new U.S. investors, further build relationships with U.S. banks, green energy funds and institutional investors and brokers

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This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

European Metals Holdings Ltd. published this content on 30 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2021 23:58:02 UTC.


© Publicnow 2021
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Financials
Sales 2021 1,17 M 0,87 M 0,87 M
Net income 2021 -3,96 M -2,94 M -2,94 M
Net cash 2021 7,79 M 5,77 M 5,77 M
P/E ratio 2021 -64,2x
Yield 2021 -
Capitalization 253 M 188 M 188 M
EV / Sales 2020 194x
EV / Sales 2021 223x
Nbr of Employees -
Free-Float 82,8%
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Managers and Directors
Keith Dudley Coughlan Executive Chairman, CEO & Managing Director
Wendy Lim Chief Financial Officer
Walter Mädel Manager-Operations
Kiran Caldas Morzaria Non-Executive Director
Richard Pavlík Executive Director