Ann: GENERAL: CRP: Chatham seeks more capital to rebuild

• Release Date: 29/06/15 12:15
• Summary: GENERAL: CRP: Chatham seeks more capital to rebuild
• Price Sensitive: No
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					CRP
29/06/2015 12:15
GENERAL
PRICE SENSITIVE
REL: 1215 HRS Chatham Rock Phosphate Limited

GENERAL: CRP: Chatham seeks more capital to rebuild

Media Release
29 June 2015
CRP seeks more capital to rebuild

Chatham Rock Phosphate is embarking on a new round of capital-raising for the
shortfall of its earlier share issue.
CRP is seeking to raise $766,000.  The shares are being marketed among
wholesale investors, particularly within the farming community.
"This is an opportunity to invest in a green local phosphate source,"
according to CRP managing director Chris Castle.
"CRP is now fund-raising as part of re-applying for an environmental consent.
Assuming we receive this consent, we will quickly move towards production."
Mr Castle noted CRP has a 20-year mining permit.
Following the latest capital-raising among existing shareholders, interests
associated with the directors and management are now CRP's largest
shareholders, with New Zealand farmers and hundreds of other Kiwis owning
more than half the company.
Mr Castle said the offer is being marketed as an opportunity to own part of
an independent local source of low cadmium, low carbon footprint rock
phosphate.
"The money currently sought allows CRP to rebuild the company over the next
12 months. A lot can happen in a year, the history of this company makes that
very evident."
CRP has undertaken an assessment of its current market value and notes there
is little downside because CRP shares are already priced on the market's
assumption that CRP will either not get the marine consent on the second
attempt or not be able to raise the funding to reapply.
The market capitalisation post the consent decline settled at $3.7 million
but has since drifted to $2.45 million (despite raising $713,000).
Mr Castle said entry into CRP at 0.6 cents a share values the company (post
placement) at $2.76 million or an enterprise value of $1.4 million net of
cash.

"That's $2 million less than our market capitalisation in April 2010, when we
had no management team as such, no contracts with Boskalis, no 20-year mining
permit, no legislation for applying for a marine consent, significantly less
knowledge about the deposit, no direct involvement or expertise in the
phosphate market, and only $250,000 in the bank.
"Even without the environmental consent, or the certainly of gaining it,
CRP's market value has exceeded $40 million for almost all of the period
September 2012 to February 2015.
Mr Castle said he is confident of a successful outcome for the environmental
permitting process next time, due to:
o An expected improvement in the Marine Consent procedure, including
interpretation of the EEZ Act
o CRP was turned down on limited and unexpected grounds that we consider
erroneous and can be dealt with more robustly on resubmission, (high-profile
fishing industry and Iwi concerns were mutually agreed to be groundless)
o CRP is confident of much wider and tangibly expressed support from relevant
government agencies, the farming sector, and other stakeholders
o The company more fully understands the rules of the game and expects the
Environmental Protection Authority to have learned from the CRP and earlier
Trans Tasman Resources applications.

Mr Castle said CRP's core attributes enabling it to make such significant
progress since being granted a prospecting permit in early 2010 include
CRP's:
o proven ability to fund the company from its inception ($33.5 million in
five years starting from a zero base)
o obtaining a 20-year mining permit
o building an internationally recognised project team
o developing unique intellectual property
o on-going partnership with Boskalis Offshore B.V.

He noted CRP has diversified with five marine applications offshore Namibia,
a developing relationship with other key players (including locals) in that
market, and is undertaking due diligence on other phosphate assets in
multiple offshore locations. Qualifying projects would be acquired using
equity and executing such acquisitions will be a focus later in 2015.
CRP is also entering the phosphate trading market aimed at using the existing
management team and industry contacts to generate cash flows prior to
production from the Chatham Rise.
Finally CRP is proceeding with a listing on the TSX.V through a reverse
takeover of Antipodes Gold, which will appeal to existing North American
shareholders, and which will facilitate fundraising in Canada, the largest
mineral-resources focused marketplace. A secondary listing in New Zealand
would remain for local shareholders.
Profitability and Value

 On 23 October 2014 we made a detailed market announcement regarding our
anticipated project economics and cost structures, including detailing our
underlying assumptions. This was updated in a further market announcement on
27 January 2015. Readers are referred to those announcements for more details
and copies can be provided on request. While the assumptions remain
applicable (and critically the assumption that we will obtain a marine
consent) those economics are significantly influenced by prevailing foreign
exchange rates. In particular, costs are largely expected to be incurred in
Euros and income is largely expected to be earned in US dollars.
Based on current exchange rates and the aforementioned assumptions, CRP's
annual profit before royalties and taxation would exceed $96 million. New
Zealand would benefit from CRP paying $34 million in annual taxes and
royalties, plus millions in port charges. Jobs - many high value and
knowledge-based - would be created in the port, on the mining ship,
undertaking environmental monitoring and broader scientific research, in the
agriculture and hospitality sectors and on the Chatham Islands.
These valuations are tabled below.
Valuer Enterprise Valuation Date
Simmonds Corporate Finance $29.8m (range midpoint)  March 2011
McDouall Stuart  $30.6m (range midpoint) March 2011
Edison Research  $400m May 2014
Chatham management $488m Current
Current offer price $1.4m Current

Chris Castle +64 21 55 81 85 or [email protected]
Warning - Forward Looking Statements
This release contains forward looking statements. Forward-looking statements
and information are not historical facts, are made as of the date of this
release, and include, but are not limited to, statements regarding
discussions of future plans, guidance, projections, objectives, estimates and
forecasts and statements as to CRP's expectations with respect to, among
other things, mineral properties and the matters described in this release.

These forward looking statements involve numerous risks and uncertainties and
actual results may vary. Important factors that may cause actual results to
vary include without limitation, the timing and receipt of certain approvals,
changes in commodity prices, changes in interest and currency exchange rates,
risks inherent in exploration results, timing and success, inaccurate
geological and metallurgical assumptions (including with respect to the size,
grade and recoverability of mineral reserves and resources), changes in
development or mining plans due to changes in logistical, technical or other
factors, unanticipated operational difficulties (including failure of plant,
equipment or processes to operate in accordance with specifications, cost
escalation, unavailability of materials, equipment and third party
contractors, delays in the receipt of government approvals, industrial
disturbances or other job action, and unanticipated events related to health,
safety and environmental matters), political risk, social unrest, and changes
in general economic conditions or conditions in the financial markets.
End CA:00266310 For:CRP    Type:GENERAL    Time:2015-06-29 12:15:25