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EPIC: HMI
Market: AIM
52-week High/Low: 22.98p / 6.80p
Sector: General Mining
Market Cap: 18.71M
Harvest Minerals Ltd.

Harvest Minerals Ltd.

Harvest Minerals is a potash and phosphate exploration and development company with projects located in Brazil.

The Group has four principal fertilizer projects – the Sergi Potash Project, the Capela Potash Project, the Arapua Fertilizer Project and the Mandacaru Phosphate Project. The Company’s Brazilian subsidiary Triunfo Mineracao holds 100% of the mineral rights in respect of the Sergi Potash Project and the Mandacaru Phosphate Project, 51% of the mineral rights in respect of and the Capela Potash Project. The Company’s other Brazilian subsidiary Triunfo Fertilizantes holds 100% of the mineral rights in respect of the Arapua Fertilizer Project. The Group is currently undertaking various exploration and development activities on all projects and, subject to capital availability, intends to undertake further exploratory analysis and drilling activities, where appropriate, over the course of the coming year on the assets to further prove up their potential.

The Company is listed on the London Stock Exchange’s AIM market.

Harvest Minerals Ltd.

www.harvestminerals.net

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Harvest Minerals Ltd. Snapshot

 

  • Drill ready potash targets in known salt layers at the Capela Potash Project in Brazil.
  • Brazil is the largest potash importer and the third largest potash consumer in the world.
  • 90% of potash imported and the rest is produced by Vale on adjacent block to Capela Potash Project.

 

Capela Potash Project

The Company has acquired a 51% interest with option to acquire remaining 49% in the Capela Potash Project sitting next to Taquari-Vassouras the only potash mine in Brazil.

  • The project is located in the Sergipe Alagoas Basin, which hosts significant deposits of sylvinite and carnallitite. Rocks with highest potassium concentrate.
  • The Capela Potash Project is located in the development friendly state of Sergipe, in an area with established infrastructure, 13km adjacent to Brazil’s only producing potash mine, Vale’s Taquari-Vassouras mine.
  • Capela Potash Project is composed by eight mineral properties with exploration licenses granted andcovering total area of 11,212 hectares.
  • The world class SED-001-11 well intersected over 16m of high grade Sylvinite as part of a total of 79m over multiple horizons.
  • 3D seismic confirmed that the Capela Potash Project is the possible northern extension to Vales Taquari-Vassouras Potash Mine to the south.
  • 3D seismic at the Capela Project has also confirmed potential salt layers at shallow depths of 235 - 325 meters.

The Company acquired 51% of the Capela Potash Project in August 2014,which is also located in the north-eastern part of Brazil, in the State of Sergipe. It is located approximately 13 km away from Vale’s Taquari-Vassouras mine. The Company has the option to increase its interest in the Capela Potash Project to 100% by performing the final payment obligation in accordance with the terms of the Capela Potash Project Agreement.

A recently completed 3D seismic has confirmed that the Capela Potash Project is the possible northern extension to Vale’s Taquari-Vassouras mine to the south. The 3D seismic has identified the potential presence of salt layers at relatively shallow depths. The Company advanced its preparation for a potential drilling programme, subject to available funding, through the completion of pre-drilling site visits as well as the progression of drilling quotes, landowner access permits and environmental licenses.

 

 

 

Arapua Fertiliser Project

The Company has acquired Arapua Fertiliser Project further developing its strong presence in Brazil’s fertiliser industry.

  • The Arapua Fertiliser Project is located in the State of Minas Gerais, approximately 400 kilometres south east of the Brazilian capital city Brasilia and within one of the major agro-industrial centers of Brazil.
  • The Arapua Fertiliser Project is composed by eight mineral properties with exploration licenses granted and covering total area of 14,946 hectares. The project is divided into three blocks Arapua, Pindaibas and Maxixeblocks.
  • At the Arapua block, notable grades from recent grab samples ranged from 5% to 24% P2O5, over apatite-rich kamafugitic rocks.
  • At Pindaibas block, recent auger drilling returned values up to 14.8% P2O5.
  • The apatite-rich rocks are nearly horizontal and strongly weathered allowing to an easy mineable operation.

 

Sergi Potash Project

The Sergi project is located in the Sergipe Basin and covers an area of 65 sq. km.

  • Ideally situated within 40km south of Vale’s Taquari-vassouras potash mine and plant.
  • High grade and economic zones of Potash intercepted:

Sylvinite:

  • Upper zone,  8.27m intercept averaging 20.94% KCl, including 5.08m at 24.84% KCl.
  • Lower zone, 8.46m intercept averaging 28.98% KCl, including 5.47m at 39.65% KCl.

Carnalite:

  • Upper zone, 12.81m intercept averaging 16.70% KCl.
  • Lower zone, 5.56m interceort averaging 21.11% KCl.
  • Full review underway by Garrisons in house Potash expert.
  • Release of tonnage and grade Exploration target in coming weeks.
  • Basic parameter economic scoping study commenced, based on underground development and utilising Vales infrastructure and plant.
  • Low capex expected due to existing infrastructure.

 

Mandacaru Phosphate Project

On  21  December  2015,  HMI  announced  that  it  had  been  awarded  two  exploration  licences  covering  the  Mandacaru Phosphate Project located in Ceara State, Brazil. Historical exploration activities conducted over the property include ground radiometric survey, mapping, surface rock sampling, trenching and a 2,141 metre diamond drilling programme from 31 holes of diamond drilling.

On 16 June 2016, HMI announced that the Mandacaru Phosphate Project contains a JORC (2012) compliant total resource of  4.38  MT  @  4.55%  P2O5,  which  includes  an  indicated  resource  of  1.47MT  @5.30%  P2O5 and  an  Inferred  resource  of  2.91 Mt @ 4.18% P2O5. The project has an estimated additional exploration potential of 4Mt of phosphate ore with similar grades,  from  the  extension  of  the  estimated  mineralized  layers,  to be proven  up  by  further  exploration  assessment.  This resource estimate was completed by GE21.

 

What is Potash(K) ?

  • Potash (K) is one of the three primary nutrients (N, P, K).
  • Potassium (K) is a soft and light alkali metal of a silver-white colour. Sylvite and carnallite are the two minerals with the highest concentration of potassium.
  • Most crops need potassium (K) much more than any other nutrient elements.
  • In plant cells potassium (K) is present in the form of salts in the cell sap and in the cytoplasm. It is one of the most vital elements.
  • Potash and phosphates are extracted from the ground through mining processes.
  • Brazil is the world’s fastest growing fertiliser market.
  • Fertiliser demand in Brazil will grow twice as fast as overall global demand.
  • Brazil is the world’s largest exporter of sugar, coffee and orange juice and the 2nd largest in soybean exports.
  • Brazil imports 90% of its potash.

What is Phosphate(P) ?

Phosphate (P) is also one of the three primary nutrients (N, P, K).

Phosphorus (P) is essential to a plant’s growth, its functions cannot be performed by any other nutrient, and an adequate supply of P is required for optimum growth and reproduction.

Phosphorus is classified as a major nutrient, meaning that is frequently deficient for crop production and is required by crops in relatively large amounts.

Brazil is one of the largest users of phosphate and accounts for 80% of Latin America consumption.

Brazilian Potash, Phosphate and Fertilizer Market

The fertilizer sector in Brazil is one of the fastest growing in the world. Over the last 15 years Brazil’s crop revenue has increased from US$23 billion to US$126 billion. Brazil is the world’s largest exporter of sugar, coffee and orange juice and the second largest exporter of soybeans. The country is currently the world’s fifth largest fertilizer consumer, and demand in Brazil is forecast to grow twice as fast as overall global demand until 2025. The country is one of the largest potash importers and the third largest potash consumer in the world, as well as the second largest world importer of phosphate.


Approximately 90% of the country’s potash demand is met through imports, with the remaining 10% produced by Vale’s Taquari-Vassouras Potash mine that is located adjacent to the Group’s Capela Potash Project (approximately 13 km away) and the Sergi Potash Project (approximately 40 km away). The Taquari-Vassouras mines has been in production since 1985 and currently has production capacity of 625,000 metric tonnes per year. Brazil also imports 50% of its phosphate consumption.

The Directors understand that the Taquari-Vassouras mine is expected to close from 2017 onwards leaving both the Group’s Sergi Potash Project and Capela Potash Project ideally positioned for a low capex development, if the Group is able to take advantage of the existing infrastructure at Taquari-Vassouras.

Brian McMaster  Executive Chairman

Mr. McMaster has almost 20 years’ experience in the area of corporate reconstruction and turnaround and performance improvement and 20 years in the mining industry. Mr. McMaster’s experience includes founding Highfield Resources, an ASX listed potash company with projects in Spain as well as numerous reorganisations and the recapitalisation and listing of 12 Australian companies.

Mr. McMaster’s career to date includes significant working periods in the United States, South America, Asia and India. Mr McMaster was a founding director in venture capital and advisory firm, Garrison Capital Pty Ltd, and is also currently a director of a number of ASX listed companies.

Matthew Wood  Executive Director

Mr. Wood has 20 years of experience in the resource sector with both major and junior resource companies and has extensive experience in the technical and economic evaluation of resource projects throughout the world. Mr. Wood’s expertise is in project identification, negotiation, acquisition and corporate development. Mr. Wood holds an honours degree in geology from the University of New South Wales in Australia and a graduate certificate in mineral economics from the Western Australian School of Mines.

Luis Azevedo  Executive Director

Mr. Azevedo is geologist and lawyer an independent Member of the Board of Directors of Brazil Minerals, Inc, Avanco Resources, Talon Metals and Harvest Minerals Ltd (formerly Tiumph Tin Ltd). Mr. Azevedo is both a licensed lawyer and geologist with +25 years of business and mining experience in Brazil. He is currently the Managing Partner at FFA Legal, a legal firm he founded with main office in Rio de Janeiro, Brazil, and which is focused solely on natural resources companies. His practice is highly active in mergers in acquisitions for companies owning mineral assets and/or operating mining enterprises in Brazil. His experience spans base metals, industrial minerals, diamonds, and precious metals, and he continually works in contact with the highest federal levels of all branches of government in Brazil.

Mr. Azevedo previously worked for Western Mining, Barrick Gold, and Harsco. He assembled land packages that resulted in four initial public offerings of Canadian companies in Brazil (Talon, Avanco, Beadell, Brazilian Gold and Carnavale) since 2004. Mr. Azevedo received a Geology degree from UERJ – Universidade do Estado do Rio de Janeiro in 1986, a Law degree from Faculdade Integradas Cândido Mendes in 1992, and a Post degree from PUC-Rio, Pontifícia Universidade Católica of Rio de Janeiro in 1995.

Mark Reilly  Non Executive Director

Mr.Reilly is a chartered accountant with 23 years experience in banking, finance and corporate reconstruction. He commenced his career with Coopers & Lybrand before establishing his own practice in 1997. He is currently the Managing Director of AIM quoted Forte Energy NL, a junior exploration company with prospective uranium assets in West Africa. Mr Reilly is also a director of ASX-listed Black Star Petroleum Limited.

Frank Moxon  Non Executive Director

Mr. Moxon is Managing Director of Hoyt Moxon Ltd, a corporate finance consultancy. He has over 25 years’ experience as a corporate financier to developing and growth companies in a wide range of industrial sectors, but has specialised for some 17 years in natural resources, and is or has been a director of a number of mining and oil & gas companies quoted in London, Australia and Canada. Amongst other things he is a former head of corporate finance at Williams de Broë Plc and, until its August 2012 sale to PTT for £1.2 billion, was senior independent non-executive director at Cove Energy Plc. He has a BSc in Economics and is a Chartered Fellow of the Chartered Institute for Securities and Investment and a Fellow of the Institute of Materials, Minerals & Mining.

Jack James Company Secretary

Mr. James has over 20 years of experience in chartered accounting specialising in corporate advisory and reconstruction. Mr. James is a partner of Palisade Business Consulting, which provides accounting, secretarial and advisory services to private and public companies, government and other stakeholders. Mr. James has a Bachelor of Business from the Queensland University of Technology and is a Chartered Accountant.

 

Significant Shareholders

 Shareholder  No. of
Shares Owned 
% of Fully
Paid Shares 
AMERICAS INVESTMENTS & PARTICIPATION LIMITED        16,000,000            15.19%
KMINE HOLDING LTD        16,000,000            15.19%
HARGREAVES LANSDOWN (NOMINEES) LIMITED          9,009,594              8.55%
PERSHING NOMINEES LIMITED        29,561,656             28.06%

 

Australian office

Street Address:
22 Lindsay Street PERTH WA 6000 Australia

Postal Address:
PO Box 8546 PERTH WA 6849
Australia

Contact Numbers:
Tel: +61 8 9200 1847
Tel: +61 8 9200 6264

UK office

Level 2
34 Dover Street
Mayfair, London WS14NG

Brazilian office

Av. Jornalista Ricardo Marinho 360, sala 113
Ed. Cosmopolitan Barra da Tijuca
Rio de Janeiro
CEP 22631-350
Brazil

Nominated & Financial Adviser

Strand Hanson Limited
26 Mount Row
London W1K 3SQ
United Kingdom


Joint Brokers


Beaufort Securities Limited
131 Finsbury Pavement
London
EC2A 1NT
United Kingdom

Mirabaud Securities LLP
33 Grosvenor Place
London SW1X 7HY
United Kingdom

Solicitors to the Company

As to Australian law:
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
Australia


As to English law:
Charles Russell Speechlys LLP
5 Fleet Place
London EC4M 7RD
United Kingdom


Share Registrar

In Australia:
Computershare Investor Services
Level 11, 172 St Georges Terrace
Perth WA 6000
Australia

In the UK:
Computershare Investor Services Plc
The Pavilions
Bridgwater Road
Bristol BS13 8AE
United Kingdom

Auditors

HLB Mann Judd
Level 4, 130 Stirling Street
Perth WA 6000
Australia

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Proactive Investor UK Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

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