Arianne enters Memorandum of Understanding with China Machinery Industry Construction Group (SINOCONST)
-Contemplated deal directly ties participation to financing; supports parallel discussions on offtake
DAN: TSX-V (Canada)
JE9N: FSE (Germany)
DRRSF: OTC (USA)
SAGUENAY, QC, June 4, 2019 /CNW Telbec/ - Arianne Phosphate (the "Company" or "Arianne") (TSXV: DAN) (OTC: DRRSF) (FRANKFURT: JE9N), a development-stage phosphate mining company, advancing the Lac à Paul project in Quebec's Saguenay-Lac-Saint-Jean region is pleased to announce that it has entered into a non-binding Memorandum of Understanding ("MoU") with SINOCONST, a large Chinese state owned enterprise ("SOE"). Under the terms of the MoU, Arianne and SINOCONST have agreed to work towards a final binding agreement relating to the development of Arianne's Lac à Paul project which, would include full project financing. On a parallel track, efforts to secure offtake are expected to be undertaken by SINOCONST in support of the financing package discussed under the MoU. Participation in the development of Lac à Paul on the part of SINOCONST is tied to finalized project financing commitments.
"This is a very exciting development for Arianne and the advancement of its Lac à Paul project," said Brian Ostroff, CEO of Arianne Phosphate. "Where China used to be self-sufficient in phosphate, many industry analysts now see the country heading for a deficit in phosphate rock concentrate, joining the likes of India, another country of over 1 billion people. Arianne believes that concluding definitive financing agreements would be mutually beneficial; it would allow Arianne the financing necessary to develop its mine and allow China, through SINOCONST, an opportunity to access high-quality phosphate concentrate. The intent is now for both parties to reach a fully binding agreement and, as per the MoU, would directly tie SINOCONST's participation in the project's development to their ability to provide necessary project financing which, we believe, will be supported by offtake discussions; a structure often seen in Chinese involvement in large mining projects. For Arianne, this is a welcomed addition to discussions we have ongoing with other potential suppliers, offtakers and financial partners and our feeling is that this should accelerate all discussions."
Although no assurances can be made as to a final agreement being reached, conversations surrounding the MoU have been ongoing for some time and both sides have indicated a strong willingness to progress to a final binding agreement in as quick a timeframe as possible.
China Machinery Industry Construction Group Inc. (SINOCONST) was founded in 1953 and, is one of the earliest large state-owned enterprises in China. SINOCONST has 15 wholly owned subsidiaries and employs over 10,000 people. During the past 60 years since its establishment, SINOCONST has been involved in hundreds of projects in 40 separate countries in different sectors including both mining and agriculture. Aside from its involvement in many global development projects, SINOCONST has established in-depth strategic cooperation relationships with many large financial institutions that can assist in the financing of these large developments. As well, given its industrial, geographic and financial advantages, SINOCONST and its subsidiary China Machinery Industry Hainan Co. Ltd., are striving to expand their import and export trading businesses that currently cover machinery, agricultural and food products and minerals.
Qualified Person
Jean-Sébastien David, P.Geo., Qualified Person by NI 43-101, has approved this release. Mr. David is also the Company's Chief Operating Officer.
About Arianne Phosphate
Arianne Phosphate ("Arianne Phosphate Inc.") (www.arianne-inc.com) is developing the Lac à Paul phosphate deposits located approximately 200 km north of the Saguenay/Lac St. Jean area of Quebec, Canada. These deposits will produce a high quality igneous apatite concentrate grading 39% P2O5 with little or no contaminants (Feasibility Study released in 2013). The Company has 109,475,913 million shares outstanding.
Neither 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.
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Cautionary Statements Regarding Forward Looking Information
This news release contains "forward-looking statements" and "forward-looking information" within the meaning of applicable securities regulations in Canada and the United States (collectively, "forward-looking information"). Forward-looking information includes, but is not limited to, anticipated quality and production of the apatite concentrate at the Lac à Paul project. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects, "is expected", "budget", "scheduled", "estimates", forecasts", "intends", "anticipates", or "believes", or the negatives thereof 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. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: volatile stock price; risks related to changes in commodity prices; sources and cost of power facilities; the estimation of initial and sustaining capital requirements; the estimation of labour and operating costs; the general global markets and economic conditions; the risk associated with exploration, development and operations of mineral deposits; the estimation of mineral reserves and resources; the risks associated with uninsurable risks arising during the course of exploration, development and production; risks associated with currency fluctuations; environmental risks; competition faced in securing experienced personnel; access to adequate infrastructure to support mining, processing, development and exploration activities; the risks associated with changes in the mining regulatory regime governing the Company; completion of the environmental assessment process; risks related to regulatory and permitting delays; risks related to potential conflicts of interest; the reliance on key personnel; financing, capitalization and liquidity risks including the risk that the financing necessary to fund continued exploration and development activities at Lac à Paul project may not be available on satisfactory terms, or at all; the risk of potential dilution through the issue of common shares; the risk of litigation. Forward-looking information is based on assumptions management believes to be reasonable at the time such statements are made, including but not limited to, continued exploration activities, no material adverse change in commodity prices, exploration and development plans proceeding in accordance with plans and such plans achieving their stated expected outcomes, receipt of required regulatory approvals, and such other assumptions and factors as set out herein. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such forward-looking information. Accordingly, readers should not place undue reliance on forward-looking information. Forward-looking information is made as of the date of this press release, and the Company does not undertake to update such forward-looking information except in accordance with applicable securities laws.
SOURCE Arianne Phosphate Inc.
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