Mkango Advances to Phase Ii of Neodymium Alloy Project with Metalysis and Raises £500,000 IN Placing
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MKANGO RESOURCES LTD.
706 27 Avenue NW,
Calgary, Alberta T2M 2J3
MKANGO ADVANCES TO PHASE II OF NEODYMIUM ALLOY PROJECT WITH METALYSIS
AND RAISES £500,000 IN PLACING
THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES
Calgary, Alberta: September 29, 2017 - Mkango Resources Ltd. ( AIM / TSX-V: MKA ) (the "Company " or
"Mkango") is pleased to announce that it has commenced Phase II of its research and development (“ R&D”)
programme with Metalysis Limited (“Metalysis”) and has raised £500,000 (C$833,333) at 3.5 pence (C$0.058)
per share in a placing (the “Placing”).
• Successful Phase I production of a neodymium -iron-boron (“NdFeB”) alloy powder has been achieved
using Metalysis’ solid-state technology
• NdFeB alloys are used to make permanent magnets, critical components of most electric vehicles,
direct drive wind turbines and many other high growth applications
• Phase I results support the commencement of a Phase II R&D programme with Metalysis, and a binding
joint venture principles and exclusivity agreement for advanced alloys using neodymium or
praseodymium with other elements for magnet manufacturing has been signed
• Neodymium and other r are earths used in permanent magnets are also key components of Mkango’s
advanced stage rare earths project (“Project”) in Malawi, so the collaboration with Metalysis
significantly enhances the strategic value of the Project
• Neodymium oxide prices have approximately doubled since th e start of the year , and the supply -
demand outlook for rare earths used in permanent magnets is very positive
Will Dawes, Chief Executive of Mkango, commented : "Mkango is now uniquely positioned in the rare earths
sector and these ve ry promising developments provide a strong platform for moving into Phase II R&D. Our
collaboration with Metalysis enhances our ability to meet supply chain requirements for accelerating growth in
the electric vehicle market, amongst other applications.
This programme is underpinned by our advanced stage Songwe Hill rare earths project in Malawi , where
Mkango is spearheading the sustainable development of rare earths for the emerging, global low carbon
economy.”
Dion Vaughan, Chief Executive of Metalysis , commented: "We are very pleased to commence Phase II of our
R&D programme with Mkango. Producing a neodymium-iron-boron alloy illustrates the wide range of advanced
alloys Metalysis’ process can produce. We look forward to collaborating with Mkango over the coming months
on this exciting project.”
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R&D programme with Metalysis
Proof of concept tests at R&D scale have successfully demonstrated that a NdFeB alloy can be generated using
Metalysis’ process from a mixed feedstock containing oxides of neodymium, iron and boron.
Metalysis can produce metal alloys directly from oxide feedstock without melting, reducing processing steps
and enabling optimised control of metal powder characteristics. Me talysis’ powders have proven particularly
well suited to 3D printing; one of a number of attributes to be evaluated in the future.
The Phase II, 12-month work programme includes product quality optimisation, test work scale-up, and further
analyses of the alloy to determine characteristics such as its morphology, chemical composition, and physical
and magnetic properties . Phase II will also incorporate customer appraisal of the product and further
investigation of opportunities in relation to 3D printing of magnets.
Mkango and Metalysis have signed a joint venture principles and exclusivity agreement for advanced alloys
using neodymium or praseodymium with other elements for magnet development. This includes joint venture
principles for commercialising intellectual property rights and/or a licence agreement with Metalysis for the
production of neodymium or praseodymium alloy powders. Under these principles, Mkango will hold an 85%
interest in the joint venture and Metalysis would receive a 15% carried interest.
The Placing
Mkango has entered into an agreement with Talaxis Ltd (“Talaxis”), a wholly owned subsidiary of Noble Group
(“Noble”) whereby Talaxis will invest £ 500,000 (£475,000 net of finders’ fees) in Mkango to be completed by
way of a Placing of 14,285,715 common shares of Mkango at 3.5 UK pence per common share. As a result,
following the Placing, Talaxis will hold an interest of 14.5% in Mkango. Noble Resources International Pte Ltd
(“Noble Resources”), a wholly owned subsidiary of Nob le, currently holds 12 million common share purchase
warrants ("Warrant") which entitle it to acquire one common share of Mkango at a price of 6.6 UK pence until
December 30, 2018. Noble Resources has agreed not to exercise that proportion of its Warrants which would
result in Noble indirectly holding 20% or more of the outstanding common shares of the Company.
On closing of the Placing , the term of the Warrants and of the services provided to Mkango under the
collaboration agreement with Noble Resources announced in December 2016 will be extended to December
31, 2020. Also on closing, the term of the 1,200,000 warrants held by Zenith Advisory Services Pty Ltd. and of
the ongoing advisory services provided to Mkango in respect of the Asian and Australian m arkets, will be
extended to December 31, 2020. The Company will pay cas h finders' fees totaling £25,000 and issue 714,285
non-transferable finders' warrants (“Finder’s Warrants”) to Zenith Advisory Services Pty Ltd. in connection with
the Placing. Each Finder's Warrant will entitle the holder to acquire one Share for 3.5 UK pence for one year
from the closing of the Placing.
The uses of proceeds from the Placing will be to commence Phase 2 R&D with Metalysis, in addition to
continued optimisation of the Project, ongoing evaluation of additional opportunities and other expenditures.
The Placing is expected to close on or around October 23, 2017 and is subject to the receipt of all necessary
approvals including the app roval of the TSX Venture Exchange . The common shares to be issued under the
Placing will be subject to a four month resale restriction under Canadian securities laws and the rules of the
TSX Venture Exchange. An application will be made for the new shares to be admitted to AIM. Following
admission, the Company will have 98,198,187 common shares in issue.
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About Metalysis Limited
Metalysis owns a solid -state technology to produce valuable periodic table metal and alloy powders. Invented
at the University of Cambridge, UK, the technology provides a more environmentally friendly , efficient process
compared to traditional metal production methods.
With commercial partners in industry and ac ademia, Metalysis uses its process to produce, powders primarily
used in 3D printing, aerospace and automotive advanced manufacturing applications.
The Company is carrying out its Generation 4 (“Gen 4”) technological expansion, on track for completion in
CY2017.
For more information, please visit www.metalysis.com.
About Mkango Resources Limited
Mkango's primary business is the exploration for rare earth elements and associated minerals in the
Republic of Malawi, a country whose hospitable people have earned it a reputation as “the warm heart of
Africa.” Mkango holds, through its wholly owned subsidiary Lancaster Exploration Limited, a 100% interest in
two exclusive prospecting licenses in southern Malawi, the Phalombe licence and the Thambani licence.
The main exploration target in the Phalombe licence is the Songwe Hill rare earths’ deposit, which features
carbonatite hosted rare earth mineralisation and was subject to previous exploration in the late 1980s.
Mkango completed an updated Pre -feasibility Study for the project in November 2015. Mkango’s strategy for
Songwe is to further optimise the project with a view to maximising efficiency and reducing costs, thereby
providing a strong platform for entering into partnerships, marketing and offtake arran gements. In December
2016, Mkango entered into an agreement with Noble Resources to collaborate in the rare earths sector.
The main exploration targets in the Thambani licence are uranium, niobium, tantalum and zircon.
For more information, please visit www.mkango.ca.
Cautionary Note Regarding Forward-Looking Statements
This news release may contain forward-looking statements. Readers are cautioned not to place undue reliance
on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon
which they are based will occur. By their nature, forward -looking statements involve numerous assumptions,
known and unknown risks and uncertainties, both general and specific, that contr ibute to the possibility that
the predictions, forecasts, projections and other forward -looking statements will not occur, which may cause
actual performance and results in future periods to differ materially from any estimates or projections of future
performance or results expressed or implied by such forward -looking statements. Such factors and risks
include, without limiting the foregoing, delays in obtaining financing or governmental or stock exchange
approvals. The forward-looking statements contained in this press release are made as of the date of this press
release. Except as required by law, the Company disclaims any intention and assumes no obligation to update
or revise any forward-looking statements, whether as a result of new information, futur e events or otherwise,
except as required by applicable law. Additionally, the Company undertakes no obligation to comment on the
expectations of, or statements made by, third parties in respect of the matters discussed above.
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For further information on Mkango, please contact:
Mkango Resources Limited
William Dawes Alexander Lemon
Chief Executive Officer President
[email protected] [email protected]
UK: +44 207 3722 744
Canada: +1 403 444 5979
www.mkango.ca
@MkangoResources
Blytheweigh
Financial Public Relations
Tim Blythe, Camilla Horsfall, Nick Elwes
UK: +44 207 138 3204
SP Angel Corporate Finance LLP
Nominated Adviser and Broker
Jeff Keating , Caroline Rowe
UK: +44 20 3470 0470
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TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any equity or other
securities of the Company in the United States. The securities of the Company will not be registered under the
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