CRP
15/09/2014 09:49
GENERAL
REL: 0949 HRS Chatham Rock Phosphate Limited
GENERAL: CRP: Chatham issues September operations update
Update
15 September 2014
Pace not letting up
The pace and level of activities by the CRP team is at full throttle as we
work on a number of fronts to advance the project.
Our first focus is ensuring the Marine Consent process proceeds as scheduled
so we can get a decision by the Environmental Protection Authority's
decision-making committee before Christmas.
The second is continuing to finance the current very high level of activity
and the inevitable associated costs. We're approaching the peak of our
spending commitments - financing all of the charges associated with the
Marine Consent process.
All up we estimate our and the EPA's costs (which CRP pays for) will be
around $4 million. These include all of the experts for CRP and the EPA and
all of the associated staff, travel, venue and other costs.
Hence the need for more money
We have announced two successful capital raising tranches over recent weeks.
One was for $1.24 million and one for $1.22 million. The shares were issued
at NZD 0.12 per share (or the approximate foreign currency equivalent). In
addition, for each share issued, one CRPOB $0.688 option was issued.
To enable all shareholders to participate at these current prices directors
resolved to extend the offer on the same terms. The share offer is in the
ratio of two new shares for every 17 shares you currently hold, with one
non-voting option granted for every new share. You will be sent documents
telling you about your entitlements and the relevant time frames.
We naturally encourage everyone to help us raise the money we need to
complete the Marine Consent process. We really appreciate the money you've
contributed in the past and hope you take advantage of what we believe will
be temporary exceptional value at these share price levels.
In addition to the offer to shareholders, qualifying habitual investors will
be able to take up any shortfall of shares not subscribed for by shareholders
within three months of the offer closing.
Merger Talks
You may have noticed that as part of the "cleansing notice" regarding the
issue we advised we have been in discussions with a publicly quoted company
with respect to a potential merger transaction.
We can't say much more at this stage. The discussions are at an early stage,
on-going and at present no agreement has been reached - binding or
non-binding - on the terms of such a transaction. Rest assured, if and when
we get to a position where these discussions progress to a documented stage,
we'll announce further details.
Evidence and queries
In late August we submitted all of our evidence from our 31 experts. While
some is technical, there is some quite readable information about the project
so it's worth having a good look around the relevant part of the EPA website
devoted to our project.
http://www.epa.govt.nz/EEZ/chatham_rock_phosphate/Pages/default.aspx
In addition to our evidence the submitter evidence was filed last Friday.
As well as the evidence from our expert witnesses, we completed the mammoth
task of providing detailed answers to 62 queries from the EPA. Every new
report and piece of evidence increases our confidence we have built the case
to demonstrate to the Decision Making Committee why this project should be
approved.
All of the pieces of the jigsaw are building a compelling picture to
demonstrate the environmental impacts are comparatively minor or can be
readily managed and the benefits - both environmental and economic - are
significant for New Zealand.
Hearings underway next week
Public hearings get underway next Thursday 25 September, and the venue will
mostly be at the Basin Reserve in Wellington. If you get the chance feel
free to pop in and see the action, even for a few hours.
This week caucusing or discussions between expert witnesses will seek to
identify areas of agreement and outstanding areas of contention.
We're not the only one
We were delighted to see Mexican based undersea phosphate project Don Diego
file its environmental impact assessment (EIA) with the Mexican Secretary of
Environment and Natural Resources. A response is expected in 60 business
days.
This is a great step forward for the marine mining industry, demonstrating
the industry has real momentum and that well-researched and considered
undersea phosphate mining projects have a major part to play in ensuring the
world's food security.
As with CRP, Don Diego used experts in marine dredging, plume modeling, sound
propagation, ecotoxicology, phosphate research and engineering for the
environmental studies and scientific findings in the EIA.
A non-technical summary of the EIA is attached.
Last word
Finally, if you missed it, it's worth reading an article written by business
journalist Pattrick Smellie regarding the concerns we had involving the EPA's
issue of a staff report.
http://www.stuff.co.nz/business/opinion-analysis/10436122/Politics-of-mining-
keep-digging
We remain concerned the staff report was premature, contained many
inaccuracies, demonstrated bias and most importantly was delivered at a point
in time when the EPA staff were fully aware that it could be destructive to
our financing arrangements.
We're conscious we have many international shareholders who don't fully
understand the New Zealand environment. There were several international
media reports saying the staff report was the final decision - which of
course it was not.
Reassuringly, numerous local and international stakeholders saw the EPA staff
report for what it was and expressed their views in writing to several
Ministers.
Much more could be said about this now but that can wait.
Notwithstanding the EPA staff sideshow we remain totally confident that our
project will be granted (by the EPA Decision Making Committee, not by the
support staff) a marine consent as a logical outcome arising from our
multi-million dollar investment, our fact based and science supported
approach, and several person-years of effort.
Chris Castle, Managing Director
[email protected] or +64 21 55 81 85
End CA:00255227 For:CRP Type:GENERAL Time:2014-09-15 09:49:46
