As part of the ECI, DF: (i) updated its due diligence on the Project based on the more recent documentation and information provided by the Company, (ii) reconfirmed quantities and pricing in the overall expected capital expenditure (“Capex”) for the Project provided in the Feasibility Study Report (defined below), (iii) established the Multicurrency GMP for the process plant and associated infrastructure and (iv) submitted a Multicurrency GMP proposal and schedule to progress to the next phase.
Sigma and DF have entered into a memorandum of understanding (the “MOU”) which includes (among its provisions) the following:
- Multicurrency GMP. The construction cost for plant and infrastructure in the Multicurrency GMP of
US$59 million (the USD:BRL translation was calculated utilizing the exchange rate ofUS$ 1 =BRL 5.05 ) is lower than theUS$66 million estimated in the NI 43-101 Technical Report on Grota do Cirilo Project Feasibility Study filed on SEDAR onNovember 6, 2019 (the “Feasibility Study Report”). The approximate 30% devaluation of the Brazilian Real since then had the overall effect of decreasing the Capex of the Project, a material portion of which is expected to be sourced domestically inBrazil and is, therefore, to be denominated in Brazilian Real.
- EPC Contract. DF will prepare a proposal for a contract for the EPC for the Project (the “EPC Contract”). The EPC Contract is to include a multicurrency Lump Sum Turnkey Price (“LSTK Price”), which is to be based on the Multicurrency GMP of
US$22.8 million (US Dollars) andR$182 .1 million (Brazilian Reais) for the engineering, have a break-down by currency and is not to exceed the Multicurrency GMP.
- Mediation of Financial Services: DF’s services are to include assisting the Company in obtaining Project financing by introducing and supporting the Company with different potential lenders, including export financing & development government agencies.
- Subcontractor: The MOU contemplates that Primero Group Americas, a subsidiary of
Primero Group of Australia , will be the subcontractor to execute engineering services for the Project.
Sigma’s Chief Executive Officer
FIRST QUARTER 2020 FINANCIAL RESULTS
Sigma’s financial statements and MD&A for the three months ended
Selected consolidated financial information is presented as follows:
(in CAD $thousands except per share information) | Three months ended | Three months ended |
General and Administrative Expenses | (425.0) | (1,072.9) |
Net Loss | (263.1) | (1,455.0) |
Net Comprehensive Loss | (1,983.0) | (1,620.4) |
Loss per Common Share - Basic and Diluted | 0.00 | (0.02) |
Three months ended | Three months ended | |
Cash and Cash Equivalents | 60.7 | 103.6 |
Total Assets | 19,483.1 | 20,927.2 |
Total Liabilities | (12,198.0) | (12,187.9) |
The Company’s net loss totaled
The Company’s total liabilities of
Management believes that the Company has access to sufficient funds for its planned expenditures for the next 12 months and to meet certain ongoing obligations with third parties. The Company has considerable flexibility in terms of the pace and timing of Project costs and how expenditures have been, or may be, adjusted, limited or deferred subject to current capital resources and the potential to raise further funds. The
NEXT STEPS FOR SIGMA IN 2020 (SUBJECT TO COVID-19 DEVELOPMENTS)
It is not possible to reliably estimate the length and severity of the COVID-19 pandemic or its ultimate impact on the financial results and condition of the Company in future periods. However, as per federal government decree, the activities of both operational and pre-operational mining companies in
However, due to international travel curtailments, the Company has been prioritizing Project activities that can be mostly executed with Brazilian-based personnel and that require a limited amount of inbound and outbound travel to and from
- Continue to work closely with the international and Brazilian financial institutions as well as with Brazilian development banks in order to finalize the debt and equity financing for the construction of the Project.
- Finalize negotiations with DF to conclude the EPC FEED Contract and initiate the detailed front-end engineering design and the EPC of the Project in the second phase of the ECI.
- Following the approval of the PAE (Plano de Aproveitamento Econômico), initiate the environmental licensing process for the Barreiro deposit, Sigma’s second deposit slated for development (the “Barreiro deposit”) and finalize the ongoing pre-feasibility study for the Barreiro deposit, validating the economic potential and production costs outlined in the PAE. Mining the Barreiro deposit, subject to completion of all related feasibility studies and assessments, has the potential to double the planned production capacity of the Project to 440,000 tonnes of lithium concentrate per year.
- Continue ongoing negotiations with offtake customers in order to enter into binding off-take agreements (interested parties to date include companies from the lithium, chemicals, battery and automotive sectors).
INDEPENDENT QUALIFIED PERSON
The technical and scientific information in this press release has been reviewed and approved by
ABOUT SIGMA LITHIUM
Sigma is a Canadian company and produces environmentally sustainable battery-grade lithium concentrate on a pilot scale since 2018, shipping high-quality above 6% Li2O coarse lithium concentrate samples to potential customers in
To secure a leading position supplying the clean mobility and green energy storage value chain, Sigma has adhered to the highest standards of environmental practices in line with its core values and mission since starting activities in 2012. Sigma’s production process is powered by hydroelectricity and the Company utilizes state-of-the-art dry-stacking tailings management and water-recycling techniques in its beneficiation process. Its corporate mission is to execute its strategy while embracing strict ESG principles. Sigma’s shareholders include some of the largest ESG-focused institutional investors in the world.
FOR ADDITIONAL INFORMATION PLEASE CONTACT
www.sigmalithiumresources.com
Company Contact:
Director of Investor Relations
44 7866 458 093
anna.hartley@sigmaca.com
FORWARD-LOOKING STATEMENTS
This news release includes certain "forward-looking statements" under applicable Canadian securities legislation including statements relating to the ultimate duration, impact and severity of the COVID-19 pandemic (including its impact on financial markets and national and multinational economies generally, and its impact on the growth of the electric vehicle market and other impacts on the demand for lithium products) and other forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. All statements that address future plans, activities, events, or developments that the Company believes, expects or anticipates will or may occur are forward-looking information, including statements regarding the potential development of resources and drilling plans which may or may not occur. Forward-looking statements and information contained herein are based on certain factors and assumptions regarding, among other things, the ability to complete the Annual Filings and Interim Filings; the market price of the Company's securities, metal prices, exchange rates, taxation, the estimation, timing and amount of future exploration and development, capital and operating costs, the availability of financing, the receipt of regulatory approvals, environmental risks, title disputes, litigation risks, failure of plant, equipment or processes to operate as anticipated, accidents, labour disputes, claims and limitations on insurance coverage and other risks of the mining industry, changes in national and local government regulation of mining operations, and regulations and other matters including the COVID-19 pandemic. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. For more information on the risks, uncertainties and assumptions that could cause our actual results to differ from current expectations, please refer to our public filings available at www.sedar.com.
Neither the
Source:
2020 GlobeNewswire, Inc., source