Update on SDA Mill disposal

RNS Number : 9901V

Rose Petroleum PLC

09 November 2017

 

9 November 2017

Rose Petroleum plc

("Rose", the "Company" or the "Group")

Update on SDA Mill disposal

Further to its announcement on 31 October 2017, Rose (AIM: ROSE), the AIM quoted natural resources business, is pleased to provide an update on the process to dispose of the Company's mineral processing mill operation in San Dieguito de Arriba, Mexico and its associated assets, licenses and agreements (together, the "SDA Mill") to Magellan Gold Corporation (OTCQB: MAGE) ("Magellan").

The sale of the SDA Mill is nearing conclusion. The final major item for closing to occur, restructuring of Mexican ownership of the SDA Mill, is at an advanced stage and is expected to be concluded in November 2017. Other key closing items already in place include the necessary funding from Magellan and Rose's shareholder approval.

Given the imminent completion of the disposal, Rose has agreed with Magellan to recommence toll-milling activities at the SDA mill under an interim agreement in order to take advantage of a commercial opportunity that has arisen. Rose has agreed to recommence toll milling operations on the basis that the US$900,000 total cash consideration for the SDA Mill purchase is placed in escrow, and that there is no financial cost or legal or operational risk to Rose in respect of the toll milling operations. Magellan has therefore funded costs of the interim operations under an approved budget and will be entitled to proceeds therefrom.  The processing plant is currently treating third-party ore on a toll basis at the rate of 100 tons per day.

As per Rose's announcement on 31 October, closing of the transaction is expected shortly, once the outstanding administrative matters in Mexico have been resolved, and with the funds for completion being placed in escrow, the Board is confident of closing the transaction in the near future.

Matthew Idiens, CEO commented "As we near completion of the disposal, we are encouraged by the commitment shown by both parties with the interim milling agreement, allowing for operations to recommence at the SDA mill and Magellan taking on a fully operational business at completion. We look forward to updating the market shortly on progress."

Enquiries:

Matthew Idiens (CEO) Chris Eadie (CFO)	Rose Petroleum plc	Tel: [phone] Tel: [phone]
Jeremy Porter / James Reeve / Liz Kirchner	Allenby Capital Limited	Tel: [phone]
Andy Thacker	Turner Pope Investments	Tel:  [phone]

 

END

 

 

DISLVLLBDFFEFBF