Update on Lithium Ore Sales & Offtake Agreement for Blesberg and Issue of Equity

Marula Mining PLC

 (“Marula’’ or the “Company”)

22 September 2023

Update on High-Grade Lithium Ore Sales and Offtake Agreement

for the Blesberg Lithium and Tantalum Mine and Issue of Equity

Marula Mining (AQSE: MARU) an African focused mining and development company, provides an update on the sale of high-grade lithium ore from the Blesberg Lithium and Tantalum Mine in South Africa (“Blesberg” or the “Project”), and the status of its negotiations over a long-term offtake agreement for production from the stockpiles at Blesberg and from the Company’s broader development plans for the proposed Blesberg open pit mining operations as announced on 31 August 2023. 

Further to the announcement on 31 August 2023, the Company announces that there has been a delay to the shipment of an initial 27.5 tonne of high-grade material processed from the historic stockpiles at Blesberg (“Initial Shipment”) to China, as a result of the restructure of the transaction through the Company’s Dubai-based agent. Payment for the Initial Shipment will be received by Marula’s South African subsidiary, South African Lithium and Tantalum Mining Pty Ltd through its Dubai-based agent upon delivery and certification of the material in Cape Town which is expected to occur shortly.

The Company can also now confirm that, further to the announcement made on 31 August 2023, it has terminated the offtake agreement with Southern Jade Resources Pty Limited (“SJR”) for the first 2,000 tonnes of spodumene material produced from the stockpiles at Blesberg (the “Termination”).

As part of the Termination, Traxys Projects LP (“Traxys”), a wholly owned subsidiary of Traxys Europe SA, has agreed to be issued, in aggregate, 15,714,279 new ordinary shares in the Company at an issue price of 14 pence per share in full satisfaction of the US$2.5 million prepayment advanced by SJR and an additional US$250,000 of deemed accrued interest. The prepayment was used by the Company to increase its interest in Blesberg and fund the first phase capital and working capital costs at Blesberg. An initial tranche of 4,714,284 new ordinary shares in the Company at an issue price of 14 pence per share are to be issued now and the balance will be issued on or before 29 September 2023.

As a result of the Termination, the Company can now proceed to finalise a new long-term offtake agreement for the sale and purchase of spodumene and lithium products produced at Blesberg with new parties. Discussions on a long-term offtake agreement for production from Blesberg are continuing, with high-grade spodumene undergoing metallurgical testing and independent testing and sampling groups having recently been on site to procure further samples for analysis, as part of the requirements to finalise these agreements.

Highlights

• The initial sale of 27.5 tonnes of high-grade 6% to 6.5% Li2O grade material will now be transported to Cape Town and scheduled for shipment to Huangpu in China
• Payment for the Initial Shipment will be received by Marula’s South African subsidiary, South African Lithium and Tantalum Mining Pty Ltd via the Company’s Dubai based trading agent upon delivery and certification of the material in Cape Town and mark the commencement of revenue income from product sales for the Company from Blesberg
• Three independent testing and sampling groups, CI Group Limited, Alfred H Knight International Limited and China Certification & Inspection (Group) Co. Ltd have recently completed site visits to Blesberg on behalf of their clients and taken samples for assay and analyses in South Africa and China
• Metallurgical process and flotation testwork on high-grade spodumene from Blesberg currently being undertaken as part of the requirements of finalising the long-term offtake agreement over production from the historic stockpiles at Blesberg
• Results from the metallurgical process and flotation testwork and assay and analysis work are expected to be completed by early October 2023
• Key commercial terms, including minimum product specifications and monthly quantities, selling terms, pricing, shipping, sampling and weight analysis, and payments terms all under negotiation and aimed to be completed shortly
• These offtake discussions are focused primarily for the sale of up to 50 tonnes per day of a +20mm high-grade lithium spodumene product that is anticipated to be produced from the re-processing of the historical stockpiles at Blesberg over the next 20 to 24 months and also for the production from the Company’s broader and longer-term development plans for Blesberg
• Termination of the previous offtake agreement with SJR now allows the Company to proceed and enter into these new long-term offtake agreements for the sale and purchase of spodumene and lithium products produced at Blesberg with new global trading groups in Europe and other interested parties
• Under the terms of the Termination, the Company has agreed to issue Traxys, in aggregate, 15,714,279 new ordinary shares at an issue price of 14 pence per share in full satisfaction of the US$2.5 million prepayment and deemed accrued interest of US$250,000
• 4,714,284 new ordinary shares are to be issued now and the balance issued on or before 29 September 2023  

Issue of Shares to Traxys

The Company has issued in aggregate 4,714,284 new ordinary shares in the Company at a price of 14 pence per share (“Traxys Shares”) to settle the liability of the advance of US$2.5 million by SJR (announced on 27 October 2022) and  deemed US$250,000 of accrued interest.

Admission

Application has been made for the Traxys Shares to be admitted to trading on the Aquis Stock Exchange Growth Market on or around 27 September 2023 (“Admission") and will rank pari passu with the ordinary shares of the Company in issue.

Total Voting Rights

Following Admission, the Company's issued share capital will comprise 148,692,908 ordinary shares of 0.01p each, with each share carrying the right to one vote, therefore the total number of voting rights in the Company will be 148,692,908. This figure may be used by shareholders as the denominator for calculations by which they will determine if they are required to notify their interest in the Company, or a change to their interest in the Company, under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

Jason Brewer, Marula Mining PLC CEO said:

“Over the past several months there has been interest from multiple Chinese groups in our lithium mining and processing operations at the Blesberg Lithium and Tantalum Mine and this initial shipment of high-grade spodumene allows us to deliver material into that market and it marks the commencement of albeit modest revenue from the sale of product from Blesberg.

“Whilst this agreement with a Chinese importer and exporter of metalliferous ores has the potential, in our view, to open up other opportunities in China for Marula, it is important to note that our focus remains firmly on concluding our negotiations on a long-term offtake agreement with one of the several global commodity trading groups for the production of lithium from Blesberg. 

“The negotiations with the global commodity trading groups for an offtake agreement are ongoing for all or part of the future production from Blesberg and the receipt shortly of the results from the metallurgical process and flotation testwork and assay and analysis work undertaken on high-grade spodumene material from Blesberg will allow us to move ahead and finalise these agreements.

“I look forward to updating our shareholders and investors on the progress of this initial shipment and on the finalisation of our long-term offtake agreement.”

The Directors of Marula are responsible for the contents of this announcement. This announcement contains inside information for the purposes of UK Market Abuse Regulation.

About Marula Mining

Marula Mining (AQSE: MARU) is an African focused battery metals investment and exploration company and has interests in several high value mine projects in Africa; Blesberg Lithium and Tantalum Mine in South Africa, Nkombwa Hill Project in Zambia and Kinusi Copper Mine, Bagamoyo Graphite Project and Nyorinyori Graphite Project in Tanzania. As we advance operations at these battery metals focused projects, Marula will continue to build and expand its interests in other high-quality projects in Africa.

Marula’s strategy is to identify and invest in advanced and high-value mining projects throughout East, Central and Southern Africa that the Directors believe would deliver returns for its shareholders. The Board and management team aims to establish Marula as a socially and environmentally responsible, sustainable, and profitable producer of critical metals and commodities that are of increasingly strategic importance to modern technologies and the global economy.

Marula’s shares are traded on the AQUIS Stock Exchange (AQSE), Marula is exploring opportunities to admit its shares to trading on AIM, the market operated by the London Stock Exchange Group plc, Kenya’s Nairobi Securities Exchange and South Africa’s Johannesburg Stock Exchange.

For enquiries contact:

Marula Mining PLC Jason Brewer, Chief Executive Officer Faith Kinyanjui Mumbi Investor Relations	Email : [e-mail] Email : [e-mail]
AQSE Corporate Adviser Cairn Financial Advisers LLP, Liam Murray / Ludovico Lazzaretti	[phone]
Broker Peterhouse Capital Limited, Charles Goodfellow / Duncan Vasey	[phone]
Financial PR and IR BlytheRay Tim Blythe / Megan Ray / Said Izagaren	[phone]

Caution;

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ''believe'', ''could'', "should" ''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect", ''will'' or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors.

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