SAGUENAY, QUEBEC – (August 23, 2017) – Arianne Phosphate (the “Company” or “Arianne”) (TSX VENTURE: DAN; OTC: DRRSF; FRANKFURT: JE9N), a development-stage phosphate mining company, advancing the Lac à Paul project in Quebec’s Saguenay-Lac-Saint-Jean region, reported its financial results for the three- and nine-month periods ended June 30, 2017. All amounts are in Canadian dollars unless noted.
“The first half of the year was a very active and productive period for Arianne,” said Brian Ostroff, CEO of Arianne Phosphate. “The Company entered into numerous agreements with large global enterprises to further the development and assist in the financing of our project. As well, we have been actively engaged in conversations with industry players to help secure both off take agreements and a strategic partner. Despite industry challenges as a whole, issues such as supply disruptions and environmental concerns have only served to highlight the quality of our asset and continues to drive strong interest in our project as we move towards development.”
Q2 2017 Financial and Operational Highlights
- In June 2017, the Company signed a Memorandum of Understanding (“MoU”) with a major global producer of sulfuric acid, to explore the possibility of setting up a downstream operation that would produce phosphoric acid. The MoU will allow for both companies to combine their respective market knowledge and address how best to move the potential venture forward. Costs, logistics and end markets will all continue to be reviewed to determine the full extent of the opportunity. Matters such as capacity, end products and location will be further studied to better assess feasibility and decisions regarding a possible business venture made from that review.
- In June 2017, the Company announced that Arianne shareholders have re-elected Messrs. Jean Lamarre, Dominique Bouchard, Brian Ostroff, James Cowley, David DeBiasio, Marco Gagnon, Siva Pillay and Steven Pinney as directors of the Company during the Annual General Meeting of Shareholders of the Company.
- In April 2017, the Company signed a MoU agreement, with Groupe Alfred Boivin (“GAB”) for the trucking of the Company’s high purity phosphate concentrate between the Lac à Paul mine site and the marine terminal on the north shore of the Saguenay River. The services offered by GAB are perfectly aligned with Arianne’s transportation strategy and will allow for the final design specifications of our trucks and trailers, as well as logistics and road and fleet maintenance. This MoU provides for a research and development program for the final selection of the truck, and the creation of the trailer.
- In April 2017, Arianne signed a MoU agreement with FLSmidth to provide all production equipment and engineering for the future plant, in collaboration with the various key suppliers involved in the Lac-à-Paul project development. FLSmidth is a leader in phosphate processing technologies covering the full flowsheet. FLSmidth comes with both strong technical ability as well as the ability to assist Arianne in sourcing the necessary financing solutions and, had already introduced the project into EKF, the Danish Export Credit Agency.
- In April 2017, the Company signed a MoU agreement with a joint venture between SNC-Lavalin (“SNC”) and Cegertec to act as project manager consultants and provide project management support, coordination and consulting for the Lac a Paul project. The joint venture will integrate all pieces into a fully functioning plan that should help us achieve engineering, cost and scheduling certainty.
Arianne is a development-stage company and, as such, did not generate revenue or positive cash flow in Q2 2017. In the second quarter ended June 30, 2017, the Company incurred net losses of $0.8M for the three-month period and $1.6M for the six-month period. This compares to a net loss of $0.8M for the three-months and $1.6M for the six-months period in the comparable periods of 2016.
At June 30, 2017, the Company had $1.0M cash on hand. These funds will be allocated towards general working capital and advancing development of Lac a Paul in 2017. Based on current spending estimates for future project development, Arianne will need additional financing in 2017.
For 2017, Arianne will be focused on the ongoing advancement and development of its Lac a Paul project. Expected milestones include:
- Reduce cash operating production costs and capital expenses;
- Sign an “Impact and Benefit Agreement (IBA)” with the First Nations;
- Assist the Port of Saguenay in securing their environmental permitting from CEEA; and
- Secure financing for construction and development of the Lac a Paul project.
Arianne’s Management Discussion and Analysis and condensed consolidated interim financial statements for the three- and six-month periods ended June 30, 2017 are available on the Company’s website and on SEDAR at www.sedar.com.
Jean-Sébastien David, P.Geo., Qualified Person by NI 43-101, has approved this release. Mr. David is also the Company’s Chief Operating Officer.