Titanium Corporation Reports Second Quarter Ended
News Release – August 27, 2019 Page 1
TITANIUM CORPORATION REPORTS SECOND QUARTER ENDED
JUNE 30, 2019
CALGARY, ALBERTA – August 27, 2019 – Titanium Corporation Inc. (the “Company” or
“Titanium”) (TSX-V: TIC) today released its results for the three and six-month periods ended
June 30, 2019.
With the completion of the FEED project and progress on post FEED activities, the Company has
continued to make excellent progress on commercialization of its CVW™ technology at Canadian
Natural’s Horizon oil sands site. The Company continued engagement with various government
agencies during the quarter to advance the contracting of the $50 million in Government grant
funding for the next phase of the project. The FEED project was completed on time and budget
and on August 1, 2019 the Company announced the receipt of $991,000 from ERA representing a
20% holdback of ERA’s contributions pending final project reporting and a third-party audit of
project costs now completed.
"The recent payment by ERA marks the official completion of the FEED phase of our project ”,
commented Scott Nelson, Titanium’s President and Chief Executive Officer. “We are now focused
on achieving a joint decision to move forward with the commercial project and associated
government funding agreements.”
Highlights for the three and six-month periods ended June 30, 2019 and recent months include:
• On August 1, 2019 the Company announced receipt of the final payment of $991,000 related
to the $5.0 million grant from Emissions Reduction Alberta ("ERA") for partial funding of the
FEED phase of the CVW™ Horizon Project. The payment represents a 20% holdback by ERA
which was subject to final project reporting and completion of a third -party audit of project
costs. The $9.9 million engineering design phase was supported by $5.0 million of grant
funding from ERA with the Company funding $1.4 million and Ca nadian Natural Resources
Limited funding $3.5 million. The Company completed the FEED Project on time and on
budget working with Canadian Natural and the engineering firms of Stantec and IHC Robbins.
Third-party engineering commenced in April 2018 and was completed in first quarter of 2019.
The Company also retained consultants and technical firms to assist with other aspects of the
engineering design and associated planning including project management, regulatory
approvals, Indigenous engagement and minerals marketing. Optimization of the project is on-
going including refining capital and operating costs to achieve the most efficient and cost
effective implementation of CVW™ technology.
• On August 7, 2019 the Company announced the appointment of Bruce Griffin to the Board of
Directors as an independent Director of the Company. Mr. Griffin has also been appointed to
the Company's Commercialization Committee. Mr. Griffin is currently the Senior Vice
President Strategic Development of Lomon Billions Group, the world's third largest producer
of high performance titanium dioxide products. Mr. Griffin brings a deep understanding of the
global minerals industry from its key markets and customers to its leading players and has
broad experience in operations, strategy, finance and capital markets.
News Release – August 27, 2019 Page 2
• In May 2019 the Company announced the first and second closings of its non-brokered private
placement for gross proceeds of $4, 262,640 resulting in the issuance of 6, 089,485 common
shares and 3, 044,743 warrants entitling the holder to purchase one common share of the
Company at an exercise price of $1.40 expiring on May 9 or May 30, 2022. As a result of the
transaction the Company now has 88, 166,359 common shares issued and outstanding. Legal
expenses, exchange fees, and cash selling commissions are expected to be $218,400 resulting
in net proceeds to the Company of $4,044,240. The net proceeds of the offering will be used
to fund ongoing efforts to commercialize the Company’s CVW™ technology and for general
operating purposes.
• On March 14, 2019 the Company announced $50 million in funding toward the next phase of
the CVW™ Horizon Project. The Federal Government awarded $45 million from two clean
technology programs; Environment and Climate Change Can ada, through its Low Carbon
Economy Fund (“LCEF”) has committed to investing $40 million and NRCan’s Clean Growth
Program (“CGP”) has committed to investing $5 million in Titanium's first of a kind
sustainable technology designed to remediate oil sands fro th treatment tailings. Emissions
Reduction Alberta (“ERA”) awarded $5 million from their Partner Intake Program aimed at
improving environmental performance in Alberta’s oil and gas sector. Funding from the LCEF
and CGP programs are subject to finalizing funding agreements which will outline the
conditions under which federal funding would be provided, including securing the remaining
funding necessary to complete the project, fulfilling all applicable requirements associated
with the project environmental assessments and Indigenous consultation requirements and
finalizing the scope of the project costs eligible for program funding.
• The Company has been meeting with other government agencies and Canadian investment
banks regarding their potential participation in the structuring and financing of the project and
their support of the Company in financial markets.
• The Company is continuing cash conservation programs including those under which
executive officers and directors receive a portion of their compensation and fees in RSUs and
DSUs. This program is aimed to conserve cash and further align Management and the Board
with shareholder interests.
FINANCIAL OVERVIEW
Titanium is focused on achieving long -term financial success by implementing its innovative
CVW™ technologies in commercial operations at oil sands sit es. With the FEED project
completed, the Company is working with Canadian Natural on the potential implementation of its
technology at Canadian Natural’s Horizon site. However, until commercial arrangements and
investment decisions are made, and facilities are constructed and operating, the Company expects
to continue to incur losses. Currently, quarterly income/losses are comprised of research and
development (“R&D”) project costs , recovery of project costs, and general and administrative
(“G&A”) expenditures.
Net (Income) Loss – For the three-month period ended June 30, 2019 the Company reported net
income of $52,000 or $0.001 per share. The net income of $ 52,000 was the result of the receipt
News Release – August 27, 2019 Page 3
during the quarter of ERA and Canadian Natural project contributions for costs incurred by the
Company in previous fiscal periods. The Company received $965,000 in April 2019 from ERA
and Canadian Natural for project costs incurred for the fifth and final milestone of the project. The
recovery of FEED project costs of $965,000 exceeded total R&D costs of $375,000 and $550,000
in G&A expenses. For the three-month period ended June 30, 2018, the Company recorded a loss
of $3,045,000 or $0.04 per share as project costs were being incurred and the recovery of ERA
and Canadian Natural costs occurred in subsequent quarters. For the six-month period ended June
30, 2019, the Company had net income of $ 478,000 compared to a loss of $ 4,599,000 for the
comparative period ended June 30, 2018. The recovery of FEED project costs of $ 2,485,000 for
the six-month period ended June 30, 2019 exceeded total R&D costs of $917,000 and $1,105,000
in G&A expenses. For a development stage company, and given the commitments under the FEED
project, the net income reported was in line with expectations.
Research & Development– R&D spending in the current quarter of $375,000 consisted primarily
of post FEED project costs related and compensation for technical staff. R&D had a net recovery
of $590,000 for the three-month period ended June 30, 2019 due to the $965,000 recovery of FEED
project costs noted above from the prior fiscal period. Project costs were lower by $2,536,000 for
the three-month period ended June 30, 2019 compared with the same period in 2018 due to the
completion of the project on February 28, 2019. For the six-month period ended June 30, 2019, a
net recovery of R&D costs was $1.6 million compared to a net R &D cost of $3.4 million for the
six-month period ended June 30, 2018 where the expected project costs aligned with the higher
work volumes and contributions for those costs were collected in future periods. The Company
continues to work on commercial proj ect related areas including , market development and a
minerals evaluation program for the new Horizon south mining area expected to be mined in the
timeframe a potential CVW™ project would be commissioned.
General & Administrative – G&A expenses for the th ree-month period ending June 30, 2019
were $550,000 compared to $581,000 for the three-month period ended June 30, 2018, a $31,000
decrease. The decrease relates primarily to a reduction in investor relations and regulatory costs
offset by an increase in travel. The Company reduced its investor relations cost as investor
relations services were provided on an as need ed basis versus a fixed retainer in the prior fiscal
period. Increase in travel costs during the three -month period ended June 30, 2019 rela ted to
market development work with potential customers for future minerals off take agreement s with
customers in international markets. For the six -month period ended June 30, 2019 , G&A costs
were $1.1 million compared to $1.2 million for the comparative six-month period in 2018. As
noted above, the decrease in G&A costs relate primarily to investor relations expenses being lower.
Cash Position - The Company had $4.8 million of cash consisting of interest -bearing cash
accounts at June 30, 2019 as compared to $0.8 million at December 31, 2018. The increase in
cash related primarily to the closing of the private placement in May of 2019 and collection of
$2.5 million in FEED project cost contributions during the six-month period ended June 30, 2019.
The Company closed the private placement in two tranches with the issuance of 6,089,485 units
($0.70 per share) for net aggregate proceeds of $4.1 million net of share issue costs. With the
News Release – August 27, 2019 Page 4
completion of the FEED project, collection of partner contributions, re ceipt of the holdback of
$1.0 million in July 2019, and the closing of the private placement, the Company’s cash position
was $5.6 million as of July 31, 2019.
To view the Company’s management discussion and analysis and interim unaudited financial
statements for the three and six month period ended June 30, 2019, please visit our website at
www.titaniumcorporation.com or SEDAR at www.sedar.com.
About Titanium Corporation Inc.
Titanium Corporation’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 reduced; hot tailings water is improved in quality for recycl ing; 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 Company’s shares 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, including statements relating to overall project economics; the advantages of
the Company's technology and the creation of a mineral sands industry; the timing and expectations for
completion of the post-FEED project activities; the scope of activities that will be undertaken in the post -
FEED project; the Company's ongoing engagement with indigenous communities and other stakeholders;
the use of proceeds from the private placement; and the expected next steps for the Company as described
in this news release. These statements 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 assisting investors and
others in understanding certain key elements of our commercialization progress and business plan, as well
as our objectives, strategic priorities and business outlook, and in obtaining a better understanding of our
anticipated operating environment. Readers are cautioned that such 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.
In addition to other factors and assumptions which may be identified in this news release, assumptions have
been made regarding, among other things: the success of the post-FEED study project activities; Canadian
Natural’s support for the Company’s current optimization plans and potential refinements of the project
News Release – August 27, 2019 Page 5
scope; the economic viability of the Company’s current optimization plans and potential refinements to the
project scope; 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 retain qualified staff; the translation of the results
from the Company's research, pilot programs, FEED project activities, post-FEED study project activities
and studies into the results expected on a commercial scale; future 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 general stability of the economic and political environment in which the Company
operates; the ability to obtain and maintain the Company's intellectual 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 successf ully market its
CVW™ technology. The forward-looking information contained in this news release is based on the results
of our research, pilot programs, FEED project activities, post-FEED project activities and related studies
and commercialization efforts. The Company has not commercially demonstrated its technologies and there
can be no assurance that such research, pilot programs, FEED project activities, post -FEED project
activities and related studies will prove to be accurate nor that such commerciali zation efforts will be
successful, as actual results and future events could differ materially from those expected or estimated in
such forward-looking statements. As a result, we cannot guarantee that any forward -looking information
will materialize and w e 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 MD&A, 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 August
27, 2019 and, accordingly, are 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 Services 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