Gratomic Provides Clarification Regarding the Finalization of Gratomic - TODAQ Off-take Agreement
Monday, May 25, 2020 1:30 PM
TORONTO, ON / ACCESSWIRE / May 25, 2020 / Gratomic Inc. ("GRAT" or the "Company") (TSXV:GRAT)(FRANKFURT:CB81)(WKN:A143MR) provides the following clarification to its May 21, 2020 press release providing an update on the purchase agreement between the Company and TODAQ where Gratomic's Aukam mined graphite will be utilized as a backstop to underpin the value of deployed TODA Notes ("TDN"). TODA Notes are a payment and loyalty asset which are backstopped by a mixed basket of digital economy commodities, land and monetary assets with graphite among the first underlying commodities, which will be supplied by Gratomic Inc.
Gratomic wishes to emphasize that no Preliminary Economic Analysis ("PEA"), Preliminary Feasibility Study or Feasibility Study has been completed to support any level of production. In fact no mineral resources, let alone mineral reserves demonstrating economic viability and technical feasibility, have been delineated on the Aukam Property.
The Company recently appointed Dr. Ian Flint to complete a preliminary economic assessment (PEA) on the Aukam Processing plant. The study, its recommendations, and their subsequent implementation, will provide conclusions and recommendation at a PEA level of comfort relating to the scale up of the existing processing plant to a commercial scale processing facility that will provide the desired concentrate grades and production rates. A preliminary economic assessment is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized.
The Company will deliver TODAQ's Product to an onsite warehouse beginning in November 2020, to fill the first three purchase orders totalling 1800 tonnes. The Company is not in a position to demonstrate or disclose any capital and/or operating costs that may be associated with the processing plant, nor the Company's ability to fulfil its obligations to deliver the 1800 tonnes of graphite as required by the purchaser orders.
Gratomic wishes to emphasize that the supply of graphite pursuant to any off-take or supply agreement referred to in this Press Release is conditional on Gratomic being able to bring the Aukam project into a production phase, and for any graphite being produced to meet certain technical and mineralization requirements. Gratomic continues to move its business towards production and as part of its business plan, expects to obtain a National Instrument 43-101 Standards of Disclosure for Mineral Projects technical report to help it ascertain the economics of the Aukam project.
No mineral resources, let alone mineral reserves demonstrating economic viability and technical feasibility, have been delineated on the Aukam Property. The Company is not in a position to demonstrate or disclose any capital and/or operating costs that may be associated with the processing plant.
The Company advises that it has not based its production decision on even the existence of mineral resources let alone on a feasibility study of mineral reserves, demonstrating economic and technical viability, and, as a result, there may be an increased uncertainty of achieving any particular level of recovery of minerals or the cost of such recovery, including increased risks associated with developing a commercially mineable deposit.
Historically, such projects have a much higher risk of economic and technical failure. There is no guarantee that production will begin as anticipated or at all or that anticipated production costs will be achieved.
Failure to commence production would have a material adverse impact on the Company's ability to generate revenue and cash flow to fund operations. Failure to achieve the anticipated production costs would have a material adverse impact on the Company's cash flow and future profitability.
For more information: visit the website at www.gratomic.ca or contact:
Arno Brand at [email protected] or 416 561-4095.
"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."
FORWARD LOOKING STATEMENTS: This press release contains forward-looking statements, which relate to future events or future performance and reflect management's current expectations and assumptions. Such forward-looking statements reflect management's current beliefs and are based on assumptions made by and information currently available to the Company. Investors are cautioned that these forward-looking statements are neither promises nor guarantees and are subject to risks and uncertainties that may cause future results to differ materially from those expected. These forward-looking statements are made as of the date hereof and, except as required under applicable securities legislation, the Company does not assume any obligation to update or revise them to reflect new events or circumstances. All of the forward-looking statements made in this press release are qualified by these cautionary statements and by those made in our filings with SEDAR in Canada (available at www.sedar.com).
SOURCE: Gratomic Inc.