Largo Provides Operational Update and Announces New Term Loan
PRESS RELEASE April 12, 2017
LARGO PROVIDES OPERATIONAL UPDATE AND ANNOUNCES NEW TERM LOAN
TORONTO – Largo Resources Ltd. (" Largo" or the " Company") (TSX: LGO) (OTCQB: LGORF ) is
pleased to provide an operation update for its Maracás Menchen Mine (“ the Mine”) and to announce
that it has entered into a term loan agreement.
The Company is pleased to report that it has now completed its 20-day shutdown which was required
to replace the kiln refractory. The replacement was completed on time and on budget and production
has already returned to normal levels. The Mine was able to stockpile sufficient intermediate feedstock
such that production continued during the kiln shutdown (albeit at a lower than normal level) and Largo
was able to meet its productions commitments during this time frame.
While the kiln refractory was being replaced, the Company was also able to incorporate several new
improvements in the leaching and kiln sections of the plant to further increase recoveries. Improvements
were also completed in the fusion area, which should increase production capacity. The Company
anticipates that these efforts in improving overall recoveries will enable it to achieve monthly production
of up to 840 tonnes per month starting as early as May 2017 – which is 5% greater than original
nameplate capacity.
Mr. Mark Smith, Chief Executive Officer to La rgo, stated: “We are extremely pleased with the
performance of our team during the replacement of the kiln refractory. In addition to completing this
large project on budget and on time, we were also able to implement a number of other improvements
during this shut down. As a result, we are antic ipating even better production results moving forward.
This anticipated increase in production coupled with an increase of approximately 10% in the price of
V205 since the first week of January 2017 will result in significant improvement to cash flow at the
operational level.”
Largo is also pleased to announce the entering into of a US$2 million six-month term loan at the
Company level (the " Loan"). The Loan will help the parent company address its short term cash
requirements while the Company continues to focus on restructuring its current capital structure.
Pursuant to the terms of the Loan, the Company also issued 400,000 common share purchase warrants
(the "Warrants") to the lenders with each such Warrant being exercisable to acquire one common share
at a price of $0.50 until December 31, 2020.
Mr. Mark Smith, stated: "This short term injection of capital at the parent level and our increasingly
positive cash flow at the operating subsidiary level provides us with the flexibility to focus on completing
our on-going capital restructuring."
About Largo
Largo Resources Ltd. is a growing strategic mineral company focused on the production of vanadium
pentoxide at its Vanadio de Maracás Menchen Mine. Vanadium is primarily used as an alloy to
strengthen steel and reduce its weight. Vanadium enhanced steels are used in a vast and growing range
of products that are used and encountered every day; including, rebar, automobiles, transport
infrastructure etc. As trends in the steel industry now demand increasingly stronger and lighter products
for advanced applications, the use of vanadium is ex pected to grow over the medium and long term.
Largo also has interests in a portfolio of other projects, including: a 100% interest in the Currais Novos
Tungsten Tailings Project in Brazil; a 100% interest in the Campo Alegre de Lourdes Iron-Vanadium
Project in Brazil; and a 100% interest in the Northern Dancer Tungsten-Molybdenum property in the
Yukon Territory, Canada. For more information, please visit www.largoresources.com.
Disclaimer:
This press release contains forward-looking information under Canadian securities legislation. Forward-looking
information includes, but is not limited to, statements with respect to completion of any financings; Largo's
development potential and timetable of its operating, development and exploration assets; Largo's ability to raise
additional funds necessary; the future price of va nadium, tungsten and molybdenum; the estimation of mineral
reserves and mineral resources; conclusions of economic evaluation; the realization of mineral reserve estimates;
the timing and amount of estimated future production, devel opment and exploration; costs of future activities;
capital and operating expenditures; success of explorat ion activities; mining or processing issues; currency
exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking
statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "s cheduled", "estimates", "forecasts", "i ntends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or
results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". All information contained in this
news release, other than statements of current and historical fact, is forward looking information. Forward-looking
statements are subject to known and unk nown risks, uncertainties and other factors that may cause the actual
results, level of activity, performance or achievements of the Largo to be materially different from those expressed
or implied by such forward-looking statements, includi ng but not limited to those risks described in the annual
information form of Largo and in its public documents filed on SEDAR from time to time.
Forward-looking statements are based on the opinions and estimates of management as of the date such
statements are made. Although management of Largo has attempted to identify important factors that could cause
actual results to differ materially from those containe d in forward-looking statements, there may be other factors
that cause results not to be as anticipated, estimated or intended. 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. Largo does not
undertake to update any forward-looking statements, except in accordance with applicable securities laws.
Readers should also review the risks and uncertainties sections of Largo's annual and interim MD&As.
NEITHER THE TORONTO STOCK EXCHANGE (NOR IT S REGULATORY SERVICE PROVIDER) ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE
CONTACT INFORMATION:
For more information, please contact:
Largo Investor Relations