Published On: April 29th, 2023
Platina Resources (ASX: PGM) announces the sale of its Platina Scandium Project to Rio Tinto for up to US$14 million.
Platina Resources has recently signed a binding sale agreement with Rio Tinto EN21 Op Co Pty Limited, a wholly-owned subsidiary of Rio Tinto Ltd, to sell its Platina Scandium Project. The company is set to receive a cash payment of up to US$14 million (~ A$21 million) as part of a deal, subject to the regulatory approvals from the New South Wales Ministerial for the transfer of Exploration Licence 7644.
As per deal details, Platina Resources will obtain cash payments of US$8 million (~A$12 million), less a US$1 million for warranty retention payment, re-payable by Rio Tinto after 30 months. Additionally, US$6 million as future cash payments (~A$9 million) is subject to project milestones achieved by the acquirer.
Platina has handled the sale process internally, and there will be no corporate advisory or success fees payable with the transaction. This significant cash provides an excellent opportunity for Platina Resources to focus on its other strategic projects and investments.
Platina Resources Managing Director Corey Nolan said,
“The transaction with Rio Tinto is congruent with Platina’s strategy of advancing projects along the value chain and monetising when a new combination of technical, market or financial capability is required. This enables projects to achieve optimal scale, minimises Platina’s capital outlay and accelerates returns to investors,” Mr Nolan said.
“Platina discovered the scandium resource in 2011 as part of an exploration program for platinum and nickel/cobalt. Platina has advanced the project over the last 12 years through geological, metallurgical and engineering studies to the point where its value has been recognised by one of the world’s largest and leading natural resource companies.
“This transaction with Rio Tinto will also allow Platina shareholders to benefit from an injection of new funding to advance its extensive gold portfolio and pursue other more advanced project opportunities without shareholder dilution.”
Mr Corey Nolan, the managing director of Platina Resources, is a renowned mining veteran with over 25 years of experience in the Mining Industry. He has a strong track record in acquiring, funding, exploring, and developing natural resource projects across the globe. In his previous role as CEO of a natural resource company, Corey Nolan was pivotal in acquiring and expanding a lithium project in Canada. Mr Nolan has a master’s degree in Mineral and Energy Economics and is a graduate of the Australian Institute of Company Directors.
About Platina Resources
Platina Resources Limited (ASX: PGM) is an Australian company primarily focusing on advancing early-stage mining projects through exploration and feasibility, leading to project development. Platina owns a wide exploration portfolio of Australia’s high-grade gold and critical mineral deposits. The company owns a 100% interest in several gold projects in the Yilgarn Craton and Ashburton Basin in Western Australia. They also control the Platina Scandium Project in central New South Wales.
Platina Resources has also invested in exploration-focused Junior mining companies such as Blue Moon Metals, Major Precious Metals, Nelson Resources and Alien Metals Ltd.
What Investors Need To Know
- Platina Resources has been focused on delivering exploration projects and aims to create shareholder value by monetising these projects through sale, joint venture, or development.
- Platina’s Scandium Project features a large and high-quality scandium deposit, which has the potential to become Australia’s first scandium producer.
- With over a 30-year mine life, it can produce 40 tonnes per year of scandium oxide.
- The demand for scandium oxide (considered a critical mineral in US and EU) is rising due to its valuable properties, making it a highly sought-after material for aerospace, defence, and other industries.
- Platina Resources’ share price stands at A$0.03 per share price, with a market capitalisation of A$16,202,689 million as of April 28, 2023.
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