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Euro Manganese Inc [TSXV / ASX:EMN] has closed a second tranche of the private placement offering it announced on 21 October of this year. The new tranche is composed of 1.2m common shares and over 26m of CHESS Depositary Interests (CDIs). These were priced at C$0.19 per share for the common shares, and A$0.20 for the CDIs.

Listed in both Toronto and Australia, Euro Manganese is a battery raw materials opportunity that sits in the heart of Europe, in the Czech Republic. EMN controls what is by far Europe’s largest manganese deposit. It holds the rights to Europe’s largest manganese resource. It is within range of Europe’s strategically important electric vehicle and battery hub, from which we anticipate massive demand for its output.

EMN stands to become the continent’s only primary producer of high-purity manganese products. China produces around 93-97% of these critical battery raw materials.

Aggregate gross proceeds under the offering were reported as approximately C$11.4m (A$12m). Euro Manganese said that the net proceeds would be used to further progress its Chvaletice Manganese Project in the Czech Republic. This includes placing the order on the Chvaletice Demonstration Plant and advancing the project’s permitting.

Proceeds will also be used for the continuation of a feasibility study and other general corporate purposes.

Proceeds will facilitate ongoing site development

The new placing will facilitate the ongoing development at the site. Euro Manganese is focusing on the extraction of independently verified manganese from tailings, the residue from historic mining activity in the former Czechoslovakia. It is being developed into a major supplier of high purity electrolytic manganese metal (HPEMM) and high purity sulphate monohydrate (HPMSM). These are both essential ingredients for Europe’s lithium-ion battery revolution.

Euro Manganese is being developed into a highly important strategic piece of the raw materials puzzle for a European EV and battery industry that is gearing up for an important industrial revolution in the way vehicles and other devices are produced in the future. As part of this, the company’s management is alive to the fact that supply chains must be eminently sustainable.

High ESG standards

The environmental criteria being used at the project at Chvaletice are consistent with the high ESG standards we expect major manufacturers like Tesla, Volkswagen and other OEMs will demand. Feedback from local communities has been sought and has been overwhelmingly positive. The project is focusing on the reprocessing of existing mine tailings rather than new mining activity, and the company will be responsible for resettling the tailings in a more environmentally friendly manner than previously without the need for hard rock mining and without generating any significant new waste.

It should be noted that the construction of a demonstration plant was recently started and is a critical next step in the project. This will be a seven-times scaled up version of the company’s existing successful pilot plant, which it took live, was built in 2018. The demonstration plant is designed to produce 32kg of HPEMEM per day, or 100kg of HPMSM per day, and to form the basis for the supply chain qualification of the Chvaletice manganese products.

Euro Manganese has also confirmed that approximately 55% of its the demonstration plant’s annual production capacity has already been allocated under memoranda of understanding to five customers.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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