Jervois Pays Tranche 1 of SMP Refinery Purchase and Enters Lease

(TheNewswire)

TheNewswire December 7 th 2020 – Jervois Mining Limited (“Jervois” or the “Company”) (ASX:JRV) (TSXV:JRV) (OTC:JRVMF) advises that it has paid the first tranche of R$15 million (US$2.9 million*) cash for the acquisition of the São Miguel Paulista nickel-cobalt refinery (“ SMP Refinery ”), in the city of São Paulo, Brazil.

Following this payment Jervois and Companhia Brasileira de Alumínio (“ CBA ”), a 100% owned subsidiary of Votorantim SA, have entered into an initial lease arrangement (“ Refinery Lease ”) providing Jervois access to undertake a Feasibility Study (“ FS ”) for the restart.  Subject to Jervois’ Early Termination Right up to September 2021, the lease shall continue until closing of Jervois’ acquisition of SMP Refinery (“ Closing ”) which is subject to the satisfaction of usual condition precedents and is expected to occur by December 2021.

On Closing, the first tranche of R$15 million (US$2.9 million*) shall be applied to the R$125 million (US$24.0 million*) cash SMP Refinery purchase price.  The timing of the balance of the purchase price is conditional upon permitting, restart FS outcomes and future production thresholds – with an outside date of June 2023.

As part of the purchase arrangements and as contained in the Refinery Lease, Jervois will pay for SMP Refinery care and maintenance (including environmental remediation) of the site from March 2021, via the cash payment of a monthly lease cost of R$1.5 million (US$0.3 million*).  Up until Closing, CBA will continue to manage the site.  After Closing, 100% ownership and operating control will transfer to Jervois as it moves forward to restart the refinery.

As announced on 27 November 2020, Elemental Engineering have commenced sysCAD modelling of the SMP Refinery flowsheet for optimization of product integration, including hydroxides and carbonate products, oxides and sulphide concentrates.  Jervois’ recently established commercial team, led by Greg Young based in the United States, are actively pursuing supply contracts for nickel and cobalt intermediates to process alongside concentrate from Jervois’s 100% owned Idaho Cobalt Operations in the United States.

On behalf of Jervois Mining Limited

Bryce Crocker, CEO.

For further information, please contact:

About SMP Refinery

SMP Refinery is a nickel and cobalt electrolytic refinery designed and constructed by Outotec that commenced operations in 1981.  The facility is located in an industrial zone in the city of São Paulo, Brazil.  It was placed on care and maintenance by CBA in 2016 after its primary source of raw materials at the time, CBA’s Niquelândia nickel-cobalt mine in the Brazilian State of Goiás , was also paused.  SMP Refinery’s production capacity was 25,000 metric tonnes per annum (“ mtpa ”) of refined nickel cathode and 2,000mtpa refined cobalt cathode.

SMP Refinery produced electrolytic nickel with 99.9% purity, exceeding the base specification required by the London Metal Exchange (“ LME ”).  This product was historically used in premium applications such as superalloys, specialty stainless steels, electroplating and batteries.  SMP Refinery broken cobalt cathodes were also of high quality and historically used in superalloys and batteries.  Nickel and cobalt cathodes were sold under the brand “Tocantins” and have an established customer base in key regions of demand today – the United States, Europe and Japan.

“Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.”

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