RB Energy Provides a Corporate Update and Announces Decision to Initiate a Sale Process for Aguas Blancas
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Sep 22, 2014) - RB Energy Inc. (the "Company" or "RBI") (TSX:RBI)(OTCQX:RBEIF) is pleased to report continued positive progress in the commissioning of the Quebec Lithium plant. Recently (News Release dated September 15, 2014), SGS Canada Inc ("SGS"), an independent consulting firm, confirmed the process design and ability to ramp up to name plate production levels (20,000 tpa) of lithium carbonate in Q1 2015. The Company has engaged SGS to mobilize a team of hydrometallurgical engineers to site to assist in meeting these timelines and achieving the production target.
In anticipation of an increased production profile at Quebec Lithium, the Board of Directors has determined that it will focus the Company's business and management efforts on lithium and as such will consider strategies to strengthen RBI's balance sheet by reducing the current levels of debt. Further, the Company recognizes that the market is not attributing appropriate value to the Aguas Blancas iodine operation in Chile. The Company's latest NI43-101 technical report dated December 19, 2013 reported an after-tax net present value of $156 million1 for Aguas Blancas at a discount rate of 10%.
Consequently, upon completion of the convertible debenture offering that the Company is currently undertaking (News Release dated September 15, 2014), the Company plans to initiate a formal process to identify opportunities to maximize value for Aguas Blancas. Any proceeds from a sale of some or all of the Company's interest in Aguas Blancas as a result of such strategic process would be used to improve the financial position of the Company. If Aguas Blancas were sold in its entirety, RB Energy would become a pure lithium story with the only hard rock lithium operation in North America.
The technical contents of this release have been reviewed by Mr. Kevin Ross, Eur. Ing., a Qualified Person pursuant to NI 43-101 and the Chief Operating Officer of the Company.
About RB Energy Inc.
RBI is a Canadian company formed pursuant to the arrangement involving Sirocco Mining Inc. and Canada Lithium Corp. It currently owns Aguas Blancas, an iodine producing mine in northern Chile, and the Québec Lithium Project near Val d'Or, the geographical heart of the Québec mining industry. The Aguas Blancas mine is currently in production. The Québec Lithium Project has completed construction and is in the commissioning phase. For more information regarding RBI, please refer to its public filings available at www.sedar.com.
1 The estimated net present value is based on Aguas Blancas' December 31, 2012 mineral resources and reserves. As at December 31, 2013 the proven and probable reserves showed a 5% increase in contained iodine.
Forward-Looking Statements
Certain information contained in this news release, including any information relating to the convertible debenture offering, the participation by a cornerstone investor and others, anticipated use of proceeds, statements regarding our ability and the timing to implement all improvements and modifications identified by SGS and to complete commissioning activities, achieve and sustain commercial production and name-plate production levels of Lithium, and the realization of full value for Aguas Blancas after a formal sale process are "forward-looking statements". These forward-looking statements relate to future events or future performance and reflect the Company's expectations regarding the future growth, results of operations, business prospects and opportunities of RBI. These forward-looking information also reflect the Company's current internal projections, expectations or beliefs and are based on information currently available to the Company. In some cases forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "intend", "plan", "anticipate", "believe", "estimate", "projects", "potential", "scheduled", "forecast", "budget" or the negative of those terms or other comparable terminology. The estimates and assumptions of RBI underlying the forward-looking statements in this news release may prove to be incorrect. Assumptions upon which such forward looking information is based include, among other things, completion of the convertible debenture offering; the participation by a cornerstone investor, anticipated use of proceeds; successful and timely commissioning; ramp-up and production at the Québec Lithium Project; the lack of any further significant capital expenditures during the commissioning stage or to bring the hydrometallurgical process plant into production; the continuing support and cooperation of RBI's off-take partners; the Company's ability to achieve and sustain name-plate commercial production; as well as financial predictions premised on such assumptions; and the realization of full value for Aguas Blancas after a formal sale process . Although the Company believes that the forward-looking information contained in this news release is based on reasonable assumptions, readers cannot be assured that actual results will be consistent with such statements. Accordingly, readers are cautioned against placing undue reliance on forward-looking information. RBI expressly disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, events or otherwise, except in accordance with applicable securities laws.
On behalf of the Board,
Richard P. Clark, President and CEO