Strategic Minerals (SML ) has received an extension of its access to the magnetite stockpile in New Mexico from the recently announced rollover to 31 March 2023 until 31 March 2027.
The mineral company’s Managing Director, John Peters, alongside Clovis Hooper, the President of Strategic’s 100% owned subsidiary Southern Minerals Group, have repeatedly sought an exclusive, longer-term extension of access to the magnetite stockpile at Cobre.
Both companies said they believe the certainty of access from an exclusive extension will provide long term cash flow for both while establishing a framework in which SMG can more aggressively seek additional sales, through its ability to provide long term certainty of supply.
Until now, the stockpile owner had been reluctant to provide longer term access to allow for the possibility of reorganising its mining activities, conducted nearby the magnetite stockpile.
Ten years of operations combined with the work undertaken to ensure contactless and safe operations throughout the pandemic has now resulted in this milestone extension, it stated.
Given that, historically, March and early April are the busiest times for operations at Cobre, a concerted marketing program is being planned for May of this year, Strategic told investors.
The Company said sales at Cobre have recovered to previous levels after the dip experienced from October 2021 through to January 2022 and that the combination of the extension of access and the planned marketing programme is expected to reflect in sales growth in 2H.
Commenting, John Peters, Managing Director of Strategic Minerals, told investors: “While a long time in coming to fruition, the extension of access at Cobre to 31 March 2027 is a huge achievement by the excellent team at Cobre and especially by its President Clovis Hooper.
“This extension should underpin the Company’s future profitability and provides scope to broaden Cobre’s clientele, which is expected to lead to higher sales in the future.”
Separately, in line with the court order obtained by the Receiver for CV Investments LLC on 22 February 2022, SMG expects to formally lodge its claim for US$21.9m, as per its recent arbitration, within the next two weeks, well ahead of the Bar Date of 25 April 2022, it noted.
The Company’s management and the Board anticipate this may produce a financial result for SMG before the end of the year, although there is no guarantee as to timing or amount.
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