Keely Lynch, The Market Online: Magnum Mining and Exploration has progressed a funding agreement with Saudi Arabia-based company, Midmetal, for the development of a Green Iron project in the region. To discuss this development, I'm joined by Magnum Mining's Director, Neil Goodman. Welcome. Neil, tell us about this agreement and what is it for and how has it come about.
Neil Goodman, MD, Magnum Mining & Exploration: Well, it's an agreement to raise about $210M worth of capital for our Saudi HIsmelt plant which will produce about a million tons a year of Green Pig Iron. And this came about after we talked to V Capital about them funding our Biochar production in Southeast Asia. So they were, and they still are, interested in Biochar production for the HIsmelt project, but they also expressed some interest in the HIsmelt plant itself. V Capital then introduced us to 2x1 and then we negotiated this agreement over the Ramadan period.
Lynch: And Neil, should investors be excited about this deal?
Goodman: They should. I am! The Board is! This is a major step forward. The funding that will be raised by V Capital and 2x1 will be added to the funding available from the Saudi government and this will be sufficient to build the HIsmelt plant in its entirety. In addition, another $10M will be injected into Magnum itself. This will provide working capital to support the Biochar and the Iron Ore projects developments.
Lynch: And remind us, what is the significance of this type of project in Saudi Arabia.
Goodman: Well the beauty of the HIsmelt technology is its flexibility in using different raw materials. This plant will convert locally produced waste materials from steel plants in the Gulf into Pig Iron using sustainably produced Biochar. And there's no other technology can do this. So other Green Iron technologies require very pure Iron Ore - very expensive - and they’ve got to combine it with very expensive hydrogen. With this project Saudi Arabia will be well placed to supply local and international steel mills with a green feed material for a profit.
Lynch: And what are some of the next steps from here?
Goodman: So the next steps for us are to go back to Saudi Arabia soon to talk to the investors for the capital about the terms of the capital investment. We'll talk to the Saudi government again about the terms for their loan, and for access to the land and to the port. And then on to local steel mills to talk about supplies for their waste materials and also off-take off the Pig for their steel production.
Lynch: Well, certainly a busy couple of months up ahead for you guys. Thank you so much for your time. Neil Goodman from Magnum Mining and Exploration, we look forward to speaking again soon.
Goodman: Thank you.
MGU Price at posting:
2.1¢ Sentiment: Buy Disclosure: Held
