Arcadia Minerals Limited has terminated the HeBei Xinjian Construction CC subscription agreement over the Swanson Tantalum Project.
HeBei Xinjian Construction CC agreed on May 29, 2023, to construct a plant and infrastructure and execute mine development and the commissioning of the Multi Gravity Separation Plant (MGS) in return for 38% equity in Arcadia’s 80% owned Orange River Pegmatite (Pty) Ltd. The Chinese company also agreed to spend US$7 million.
The commissioning would have included the obligation by HeBei Xinjian Construction CC to construct the plant to the detailed engineering specifications provided by Arcadia.
HeBei Xinjian Construction CC would have earned equity interest upon, among other certificates, the delivery of a processing plant production certificate by Arcadia’s engineers confirming that the plant can process 20,000 tons of ore per month.
Arcadia Minerals says the A$620,000 development funds spent by HeBei Xinjian Construction CC to date are considered sunk, with no obligation for repayment.
This amount does not include the cost of constructing access roads over the mountainous terrain and establishing a processing site, which was completed at HeBei Xinjian Construction CC’s cost and considered an asset of Orange River Pegmatite without any obligation to reimburse HeBei Xinjian Construction CC.
The processing equipment reportedly purchased by HeBei Xinjian Construction CC in China worth approximately A$2.6 million was never delivered to the mine site, and, consequently, the transfer of ownership to Orange River Pegmatite has not occurred.
As a result of the termination of the agreement, Arcadia Minerals has retained its 80% interest, and the company has started seeking an alternative funding partner to resume the development of the Swanson Tantalum Mine.
The delivery of core equipment, consisting of the multigravity separators and spiral circuits, to the project’s site remains pending due to the outstanding balance of about A$548,550, which HeBei did not complete after the deposit payment.
Arcadia Minerals says the suppliers have agreed to hold off on this equipment until the company secures a new funding partner for the project.
According to a statement dated January 31, 2025, Arcadia has sourced equipment from several suppliers in Southern Africa on a competitive basis and included equipment ancillary to the core equipment needed to construct the plant in the costing schedule.
“The directors believe that the equipment necessary to complete the plant can be sourced to complete the processing plant construction within the set budget of US$9,8 million,” the statement says.
Arcadia Minerals says it has finalized an information memorandum to initiate a competitive bidding process immediately and is currently engaged in discussions with several interested parties with the financial capacity to resume the project’s development on an equity basis.
