Titanium Corporation Reports Results FOR the Third
News Release – November 24, 2020 Page 1
TITANIUM CORPORATION REPORTS RESULTS FOR THE THIRD
QUARTER ENDED SEPTEMBER 30, 2020 AND PROVIDES PROJECT
UPDATE
CALGARY, ALBERTA – November 24, 2020 – Titanium Corporation Inc. (the “Company”
or “Titanium”) (TSX-V: TIC) today released its results for the three and nine-month periods
ended September 30, 2020.
The COVID-19 pandemic and the collapse of oil demand and prices in 2020 has introduced
unprecedented uncertainties for Canada’s oil sands industry and the Canadian economy. In recent
months, there has been a second wave of the pandemic and t he duration and the extent of the
impact of these events is not known but could adversely affect the progress and timing of the
CVW™ Horizon Project (the “Project”). In response, the Company has taken measures to protect
its balance sheet by reducing costs and conserving cash.
During the first nine months of 2020, the Company and Canadian Natural Resources Limited’s
(“Canadian Natural”) joint project engineering t eam has continued work on the Project utilizing
internal resources, performing post-front end engineering design (“FEED”) e ngineering reviews,
validation and optimization of the Project as well as continuing on -going minerals analysis
programs. The main focus of the Project team in 2020 has been the optimization of the concentrator
facility and the design and engineering of a tailings thickener and associated facilities.
Optimization of the minerals facility, including further work by an external minerals engineering
firm, commenced in the fourth quarter 2020 and will continue into 2021. In parallel, the Company
has been providing updates to the Alberta and Federal government agencies who have awarded
grant funding for the Project, working with them toward finalizing funding contracts and assessing
new, recently announced programs, for potential additional funding for the Project.
“While we are all experiencing the on-going uncertainties and challenges of the pandemic and the
economy, our joint Project team has remained very focused on advancing our Project, completing
another successful quarter of facility engineering and minerals d evelopment,” commented Scott
Nelson, Titanium’s President and Chief Executive Officer. “We were pleased to complete the ERA
funding agreement during the quarter and are now working on other government funding programs
to support the Project. Our Project is highly relevant to government and industry objectives of
reducing climate changing emissions, particularly methane, and supporting shovel-ready projects
that will stimulate Alberta and Canada’s economic recovery.”
Certain highlights for the three and nine-month periods ended September 30, 2020 are set out in
more detail below:
• On September 28, 2020, the Company announced that Emissions Reduction Alberta ("ERA")
and Titanium signed a contribution agreement for the award of $5 million of grant funding for
the Project. A portion of eligible Project costs will be reimbursed with the successful
completion of specified milestones outlined in the agreement. $2.0 million in ERA grant
funding is available for the detailed engineering phase of the Project with the balance of $3.0
million available for the procurement and construction phases.
News Release – November 24, 2020 Page 2
• Engineering optimization and validation activities by the internal Project engineering team
continued during the third quarter. This activity has been mainly focused on the concentrator
facility with the objective of improving operability, enhancing environmental performance and
reducing costs . This work includes changes to the plot plan to increase modularization,
relocating certain equipment and reducing building sizes; the addition of a vapor recovery unit
to the flotation circuit; the review of alternate flotation technologies and the addition of a
tailings thickener which will process and remediate the tailings from the concentrator. The
Project team expects to substantially complete the optimization phase of concentrator
engineering by the end of the fourth quarter of 2020.
• Minerals testing and analysis of larger tailings samples commenced in the third quarter and is
ongoing to provide current data for the engineering design of the minerals facility. In the fourth
quarter, optimization engineering commenced for the minerals facility and will continue into
2021. IHC Robbins, an expert minerals engineering firm who have been providing engineering
services to the Company throughout R&D and front end engineering design programs, have
been contracted for preliminary design of the minerals facility process flowsheet. The redesign
will incorporate production of a high-quality zircon sand concentrate and a high TiO2 ilmenite
product and other modifications.
• In addition to finalizing ERA, the Company continued to advance contracting with other
government funding agencies providing updates on the impacts of the COVID -19 pandemic
and the oil demand and price collapse on the Project. Funding from government programs is
subject to finalizing funding agreements which outline conditions under which funding would
be provided. Of the $50 million of grant awards to the Company in 2019, approximately $7
million is designated for the engineering phase of the Project with the balance for the
procurement and construction phases.
• Several new Alberta and Federal government funding programs aimed at reducing emissions,
increasing energy efficiency, and supporting new technology implementations have been
announced in the third and fourth quarters of 2020. The Company is assessing these programs,
is in discussions with governments to determine their applicability to the Project and is making
further funding applications where applicable.
• The Company implemented salary reductions in the range of 15 to 20% effective April 1, 2020
to preserve cash in response to the uncertainty created by the COVID -19 pandemic and the
resulting delays to the Project. The Company is also continuing its cash conservation programs
including those under which management and directors receive a portion or all their
compensation and fees in restricted share units and deferred share units (“DSUs”),
respectively. This program is aimed at conserving cash and further aligning management and
the Board with shareholder interests. Since the inception of the program in 2015, the
Company’s directors have been receiving 100% of their compensation in DSUs in lieu of cash
News Release – November 24, 2020 Page 3
compensation. To date, $3.9 million in management and Board cash compensation has been
conserved through the program.
FINANCIAL OVERVIEW
Titanium is focused on achieving long -term financial success by implementing its innovative
CVW™ technologies in commercial operations at oil sands sites. The Company is working with
Canadian Natural on engineering optimization and detailed engineering for the potential
implementation of its technology at Canadian Natural’s Horizon site. However, until post-FEED
and optimization Project activities are completed to the satisfaction of the parties, commercial
arrangements and investment decisions are made, and facilities constructed and operating, the
Company expects to continue to incur losses. Currently, quarterly (losses)/income are comprised
of research and development (“ R&D”) project costs , and general and administrative (“G&A”)
expenditures.
Net (Loss) Income – For the three and nine -month periods ended September 30, 2020, the
Company reported net loss of $0. 78 and $2.3 million, respectively. This resulted in a $0.01 loss
per share for the current quarter and a $0.03 loss per share for the nine -month period ended
September 30, 2020. The net loss for the three month period ended September 30, 2020 consisted
primarily of G&A ($0.3 4 million) and R&D ($0. 44 million) expenses in the current quarter
compared to net income of $0.3 million for the three -month period ended September 30, 2019 as
the Company received Project contributions for the FEED Project in the prior period which
exceeded Project costs incurred and G&A expenses. For the nine-month period ended September
30, 2020 net loss of $2. 4 million consisted primarily of G&A ($1.3 million) and R&D ($1. 2
million) expenses compared to net income of $0.75 million for the nine -month period ended
September 30, 2019. As noted above, the receipt of Project contributions related to the FEED
Project in the prior period exceeded G&A and R&D expenses. For a development stage company,
the net loss was in line with expectations.
Research & Development – R&D spending in the current quarter consisted primarily of
compensation for technical staff, on -going minerals testing and evaluations, and post -FEED
optimization engineering work. Compensation and deferred compensation costs were lower due
to the salary reduction initiatives implemented on April 1, 2020. Project costs were higher by $0.2
million for the three-month period ended September 30, 2020 compared to the same period in 2019
due to minerals product development and ongoing testing, and the Company’s share of joint project
costs for engineering work by Canadian Natural. Recovery of project costs was nil for the three -
month period ended September 30, 2020 compared to $1.0 million for the three -month period
ended September 30, 2019. The recovery in 2019 related to the collection of FEED contributions
from ERA and Canadian Natural for the final FEED project milestones. Based on the level of post-
FEED activity, R&D costs were in line with expectations.
General & Administrative - G&A expenses for the three -month period ending September 30,
2020 were 29% lower at $0.34 million as compared to $0.48 million for the three -month period
News Release – November 24, 2020 Page 4
ended September 30, 2019. For the nine-month period ending September 30, 2020, G&A expenses
were 19% lower at $1.3 million compared with $1.6 million in the comparable 2019 per iod.
Management made voluntary salary reductions effective April 1, 2020 and significantly reduced
other variable compensation to preserve cash and deal with the ongoing impact of the COVID-19
pandemic and the economic uncertainty related to the decline in oil prices. Professional fees in the
quarter increased due to legal costs related to contract reviews for grant funding agreements offset
by zero travel expenses due to COVID-19 related restrictions. For the nine -month period ended
September 30, 2020 , th e increase in consulting and professional fees related to legal fees for
shareholder matters and regulatory reporting requirements due to the COVID -19 pandemic.
Investor relations costs increased during the nine-month period due to costs related to hosting the
annual shareholder meeting in a virtual format to comply with public health measures. G&A cash
expenses were lower by $ 39,000 during the quarter primarily related to compensation and travel
reductions, offset by professional fees and regulatory costs as compared to the three-month period
in the prior year. Deferred and equity -based compensation costs were lower during the three -
month and nine-month periods ended September 30, 2020 as the Company did not grant stock
options in the current fiscal year and voluntarily reduced deferred compensation programs. These
on-going initiatives together with rent reductions, group benefit premium reductions, workers
compensation premiums refunds and other initiatives will continue to reduce G&A throughout the
balance of the year.
Cash Position – The Company had an aggregate of $3.2 million in cash at September 30, 2020
consisting of cash and interest-bearing cash accounts as compared to $5.1 million at December 31,
2019. The decrease in cash and short-term investments of $1.9 million is the result of funding the
Company’s post -FEED Project activities, general and administrative and public company
expenditures. While the Company has enou gh cash to cover normal operating cash costs for the
next twelve months, the ability to cover detailed engineering programs will depend on the
approved programs for 2021 and the amount of government funding the Company is able to secure
for those programs. Once there is more certainty with respect to the approved program and the
supporting government funding, the Company will evaluate the funding requirements to determine
the timing and required capital to support the continued development of the project.
To view the Company’s management discussion and analysis and interim unaudited financial
statements for the three and nine-month period s ended September 30, 20 20, please visit our
website at www.titaniumcorporation.com or SEDAR at www.sedar.com.
About Titanium Corporation Inc.
Titanium is a clean technology innovator focused on providing solutions to the mining sector of Canada’s oil sands
industry. Titanium s CVW™ technology provides sustainable solutions to reduce the environmental footprint of the
oil sands industry. Our technology reduces the environmental impact of oil sands froth treatment tailings while
economically recovering valuable products that would otherwise be lost. CVW™ recovers bitumen, solvents, heavy
minerals and water from tailings, preventing these commodities from entering tailings ponds and the atmosphere:
volatile organic compound and greenhouse gas emissions are materially redu ced; hot tailings water is improved in
quality for recycling; and residual tailings can be thickened more readily. A new minerals industry would be created
commencing with the production and export of zircon, an essential ingredient in ceramics. The Compan y’s shares
News Release – November 24, 2020 Page 5
trade on the TSX -V under the symbol “TIC”. For more information please visit the Company’s website at
www.titaniumcorporation.com.
Disclosure regarding forward-looking information
This news release contains forward -looking statements and information within the meaning of applicable Canadian
securities laws (collectively, " forward-looking information ") that reflect the current expectations of management
about the future results, performance, achievements, prospects or opportunities for Titanium, i ncluding statements
relating to the occurrence and timing of future steps with respect to the CVW™ Horizon Project, including the Project
activities post-FEED, including the ongoing minerals analysis and optimization of the minerals facility, timing of
completion of the internal optimization of the concentrator facility and the factors that are expected to affect such
occurrence and timing; the continued effective collaboration between the Company and Canadian Natural; the
Company's ongoing engagement wi th its business partners and government funding agencies; the Company's
continuing cash conservation program and expectations regarding the Company's current cash position ; the
Company's ongoing evaluation of financing opportunities, including grant and fi nancing opportunities from
applicable government programs; and the advantages of the Company's technology in assisting with the recovery of
the energy industry in Alberta and Canada. This forward-looking information generally can be identified by use of
forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "believe", "project", "should" or
"continue" or the negative thereof or similar variations.
Forward-looking information is presented in this news release for the purpose of a ssisting investors and others in
understanding certain key elements of our financial results and business plan, as well as our objectives, strategic
priorities and business outlook, and in obtaining a better understanding of our anticipated operating envir onment.
Readers are cautioned that such forward-looking information may not be appropriate for other purposes.
Forward-looking information, by its very nature, is subject to inherent risks and uncertainties and is based on many
assumptions, both general and specific, which give rise to the possibility that actual results or events could differ
materially from our expectations expressed in or implied by such forward -looking information and that our business
outlook, objectives, plans and strategic priorities may not be achieved. Macro-economic conditions, including public
health concerns (including the impact of the COVID-19 pandemic) and other geopolitical risks, the condition of the
global economy and, specifically, the condition of the crude oil and natural gas industry including the collapse of
global crude oil demand and prices and other commodity prices and dem and in 2020, and the ongoing volatility in
world markets may adversely impact oil sands producers' program plans, including proceeding with an investment
decision in further Project activities post-FEED or any final investment decision with respect to commercialization,
which could materially adversely impact the Company. In addition to other factors and assumptions which may be
identified in this news release, assumptions have been made regarding, among other things: the condition of the global
economy, including trade, public health (including the impact of the COVID -19 pandemic) and other geopolitical
risks, including the fact that any estimates of Project next steps post-FEED , as well as the detailed engineering and
construction period may be affect ed by the COVID -19 pandemic, condition of the global economy and commodity
prices, in particular crude oil prices; the stability of the economic and political environment in which the Company
operates; the success of the Project activities post-FEED, inclu ding the expected assessment of post -FEED
engineering reviews for next steps as part of the Project activities post-FEED; the focus of the post-FEED project on
optimization of the concentrator facility and design and engineering of a tailings thickener and associated facilities,
including the expected timing of completion thereof and commencement of optimization of the minerals facility; the
ability of the Company to produce and sell a high quality zircon sand concentrate and a high TiO2 ilmenite product,
including the ability of the Company to redesign its minerals flowsheet and zircon circuitry to include production of
these products; the ability of the Company to enter into commercial contracts with oil sands producers and to achieve
commercialization of the CVW™ technology, including the anticipated scope of such commercial contracts; the ability
of the Company to enter into commercial contracts with other strategic partners in relation to building and operating
facilities, as required; the ability of the Company to continue with its cost reduction initiatives and to be supported by
its current cash position; the ability of the Company to retain qualified staff; the ability of the Company to obtain
financing on acceptable terms, including available grant and financing opportunities from government programs and
News Release – November 24, 2020 Page 6
finalizing funding agreements for such government programs, as well as any additional funding requirements required
to complete the detailed engineering phase ; the translation of the results from the Company's research, pilot
programs, Project activities during the FEED, Project activities post-FEED and studies into the results expected on
a commercial scale; the belief that the Company's technology will provide important environmental and economic
benefits that will assist with the recovery of a resilient and sustainable energy industry in Alberta and Canada; the
anticipated timing for the completion of detailed engineering and construction once all Project activities post-FEED
are completed and a fin al decision to proceed has been made; future crude oil and zircon prices and the impact of
lower prices on activity levels and cost savings of oil sands producers; the impact of increasing competition; the
ability to protect and maintain the Company's inte llectual property; currency, exchange and interest rates; the
regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which the Company
operates; and the ability of the Company to successfully market its CVW™ techn ology. The Company has not
commercially demonstrated its technologies and there can be no assurance that our research, pilot programs, Project
activities during the FEED, Project activities post-FEED and related studies will prove to be accurate nor that such
commercialization efforts will be successful, as actual results and future events could differ materially from those
expected or estimated in such forward -looking information. As a resu lt, we cannot guarantee that any forward -
looking information will materialize and we caution you against relying on any of this forward -looking information.
Accordingly, readers should not place undue reliance on forward-looking information.
Additional information on these and other factors are disclosed in our most recently filed management's discussion
and analysis, including under the heading “Discussion of Risks”, and in other reports filed with the securities
regulatory authorities in Canada from time to time and available on SEDAR (sedar.com).
The forward-looking information contained in this news release describes our expectations as of November 24, 2020
and, accordingly, is subject to change after such date. Except as may be required by Canadian securities laws, we do
not undertake any obligation to update or revise any forward -looking information contained in this news release,
whether as a result of new information, future events or otherwise.
Neither the TSX Venture Exchange nor its Regulation Se rvices Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release .
For further information, contact:
Scott Nelson Jennifer Kaufield
President & CEO Vice President Finance & CFO
Tel: (403) 561-0439 Tel: (403) 874-9498