Shares in Alba Mineral Resources (ALBA) jumped on Friday after details were published of the floatation of GreenRoc Mining, a spin-off vehicle based on its Greenland mining assets. 

The London-listed firm announced in its final results for the year ended 30 November 2020 published back in May 2021 its intention to form a new AIM-quoted, Greenland-focused, spin-out company that would unlock ‘real and sustained value’ across its asset portfolio. 

The plan formed after the pandemic had placed some doubt upon Alba’s ability to execute its field programmes, particularly at the Amitsoq Graphite Project where it had plans to drill.

At the time, it said it believed that moving the Greenland Projects into a new listed vehicle would allow the market to set ‘a clear value for those assets in isolation’ rather than as part of a larger pool of diverse mining, oil and gas and exploration assets, as is currently the case.  

The newly formed vehicle, which was spun out as GreenRoc earlier this year, expects to raise £5m in its IPO upon its admission in mid-September for a market capitalisation of £11 million. 

GreenRoc Mining’s assets include the Thule Black Sands Ilmenite Project, the Amitsoq Graphite Project, the Melville Bay Iron Project and the Inglefield Multi-Element Project. 

The Company said it plans to progress exploration and development activities in respect of the Greenland Projects ‘with the aim of securing a mining licence and commencing commercial production at one or more of the projects within the earliest practicable timescale.’

Following the recently completed drilling programme at the Amitsoq Project, the objective will be to define a maiden JORC-compliant Mineral Resource Estimate for Amitsoq, allowing the Company to move to commissioning a detailed economic assessment of the Project.

Meanwhile, following the recently completed extension drilling programme at TBS, the objective will be to define a substantial increase to the Mineral Resource Estimate.

In consideration of the divestment of its Greenlandic assets to GreenRoc, Alba Mineral Resources is to receive GreenRoc shares valued at £6m on Admission, which shareholding is expected to represent 54.0% of the enlarged share capital of GreenRoc on Admission.

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Last week, Alba Mineral Resources announced that it had successfully completed Phase 2 drilling operations at the Company’s Thule Black Sands Project in northern Greenland. 

Alba said 249 holes were completed for 550 metres, nearly double the planned 125 holes. Depths of mineralised sand reached up to 6m in some places, with average depths of 2.2m.  

The Group said a significant upgrade in the defined resources at TBS will enable Alba to move forward with scoping level studies to assess the economic exploitation of the project. 

He also noted that a significant upgrade would allow Alba to plan for the EIA/SIA work which will need to be completed in 2022 as a precursor to an application for a mining licence.

In this Q&A from May 2021, Alba Minerals’s Chairman, George Frangeskides elaborates on the rationale behind spinning out their Greenland assets into a new listed entity. He discusses the benefits to both Alba and its shareholders, funding and the advantages of Greenland.

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