Global Atomic Signs Construction Agreement for Process Plant Expansion in Turkey | Financial Buzz

Global Atomic Signs Construction Agreement for Process Plant Expansion in Turkey

  • EPC contract signed with Grupo Sarralle
  • Construction completion targeted for September 2019
  • Annual zinc production expected to increase from 33 million pounds in 2017 to 60 million pounds, attributable to the BST JV (100%)
  • EBITDA is expected to more than double from C$22.0 million recorded in 2017 to C$47.9 million attributable to the BST JV (100%), at current zinc prices and exchange rates
  • Net income from the BST JV attributable to Global Atomic is expected to increase from C$6.9 million in 2017 to C$17.2, at current zinc prices and exchange rates

TORONTO, June 22, 2018 (GLOBE NEWSWIRE) — Global Atomic Corporation (“Global Atomic” or the “Company”), (TSX-V:GLO) is pleased to announce it has signed an Engineering, Procurement and Construction (“EPC”) contract with Grupo Sarralle, headquartered in Spain, to complete the expansion of its electric arc furnace dust (“EAFD”) plant in Iskenderun, Turkey.  Costs for expansion will be funded through forecasted cash flow and lines of credit available to the Befesa Silvermet Turkey, S.L. (“BST”) joint venture, of which Global Atomic holds a 49% interest.  Expansion costs are estimated at US$26 million, of which US$24 million is a fixed price EPC contract. 

The expansion project will modernize the entire processing plant, expanding throughput to 110,000 tonnes of EAFD processing capacity per annum and producing approximately 60 million pounds of zinc in concentrate, attributable to the BST Joint Venture.  At expanded production levels and assuming current zinc and foreign exchange prices, EBITDA is forecasted to more than double to C$47.9 million, implying C$23.4 million in EBITDA for Global Atomic’s 49% interest.  Net income attributable to the Company’s interest in the BST JV is expected to grow to C$17.2 million.

Stephen G. Roman, Chairman, President and CEO, commented, “This is a pivotal point for the Company.  Within a year we expect plant expansion and modernization to be completed, which will double our annual cash flows.  Our expectation is the expansion will be a significant value catalyst going forward.”

Production and financial projections may change do to varying underlying assumptions including, but not limited to, availability of EAFD to process, future price of zinc, currency exchange rates, ability for equipment or processes to operate as anticipated, and credit availability.

About Global Atomic

Global Atomic is a TSX Venture listed company providing a unique combination of high grade uranium development and cash flowing zinc concentrate production. 

The Company’s Uranium Division includes six exploration permits in the Republic of Niger covering an area of approximately 750 km2.  Uranium mineralization has been identified on each of the permits, with the most significant discovery being the DASA deposit situated on the Adrar Emoles III concession, discovered in 2010 by Global Atomic geologists through grassroots field exploration.

Global Atomics’ Base Metals Division holds a 49% interest in BST, which operates a processing facility located in Iskenderun, Turkey that converts Electric Arc Furnace Dust into a high-grade zinc oxide concentrate and sold to zinc smelters around the world.  The Company’s joint venture partner, Befesa Zinc S.A.U. (“Befesa”, listed on the Frankfurt exchange under ‘BFSA’), holds a 51% interest in and is the operator of BST.  Befesa is a market leader in EAFD recycling, capturing approximately 50% of the European EAFD market with facilities located throughout Europe and Korea.

Key contacts:

Stephen G. Roman George A. Flach, P.Geo.
Chairman, President & CEO Vice President, Exploration
Tel: (416) 368-3949 Tel: (416) 368-3949
Email: sgr@globalatomiccorp.com Email: gaflach@globalatomiccorp.com

The information in this release may contain forward-looking information under applicable securities laws.  Often, but not always, forward-looking statements can be identified by words such as “pro forma”, “plans”, “expects”, “may”, “should”, “could”, “will”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, “targets”, “believes”, or variations including negative variations thereof of such words and phrases that refer to certain actions, events or results that may could, would, might, or will occur or be taken or achieved.  Forward-looking information is subject to known and unknown risks, uncertainties and other factors which cause the actual plans, results, performance or achievements of Global Atomic to differ materially from any future plans, results, performance or achievements expressed or implied by the forward-looking statements.  Such factors include, among others, actual operating cash flows, operating costs, free cash flows, mineral resources, total cash, transaction costs, salaries, administrative and other costs of the Company differing materially from those anticipated; project infrastructure requirements and anticipated processing methods differing materially from those anticipated; risks related to partnership or other joint operations; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; inability to find additional sources of capital on favourable terms; dilution due to future equity financings; fluctuations in zinc and other metal prices and currency exchange rates; uncertainty relating to resources; inability to successfully complete new development projects, planned expansions or other projects within the timelines anticipated; adverse changes to market, political and general economic conditions or laws, rules and regulations applicable to the Company; changes in project parameters; and ability to obtain sufficient electric arc furnace dust to maintain operations.  Readers are cautioned not to place undue reliance on this forward-looking information.  The Company does not assume the obligation to revise or update this forward-looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.

 

Primary Logo