CMO - CHROMETCO LIMITED - Shareholder update

CHROMETCO LIMITED

(Incorporated in the Republic of South Africa)

(Registration number: 2002/026265/06)

Share code: CMO

ISIN Code: ZAE000070249

(“Chrometco” or “the Company”)

 

SHAREHOLDER UPDATE

 

Shareholders attention is drawn to the announcement made by International Ferro Metals Limited (“IFM”) that IFM has been placed into business rescue on 26 August 2015.

 

Shareholders are also referred to the announcement released on SENS on 10 October 2014 wherein the Company advised shareholders that it had signed agreements with IFM, in order for IFM to mine open pitable LG6 at Chrometco's Rooderand Mine and for IFM to purchase the ore mined.

 

Mining at Rooderand by IFM commenced in November 2014. The difficulties related to the ore body exhibiting a higher degree of geological faulting, steeper dips and a higher degree of weathering resulted in mining operations being suspended in May 2015, pending review of the results and further mine planning by IFM IFM had indicated that it expected to take a final decision on its future plans at Rooderand in the 3rd quarter of 2015, taking into account that the 12 month contract lapses in October 2015 and that it had an option to extend the contract beyond that date.

 

As at commencement of IFM’s businesses rescue process, there remain outstanding contractual and financial obligations due to Chrometco in terms of the agreements referred to above and which are mainly related to rehabilitation obligations.

 

Chrometco expects to liaise with IFM’s business rescue practitioner on the way forward and on the fulfilment in due course by IFM of its obligations to Chrometco.