Second Quarter Highlights
- The ExO NAFTA case moves toward conclusion of evidentiary phase
and prepares for closing submissions in the third quarter of
2022.
- Odyssey completes $16.1M registered direct offering, allowing
the company to continue its deleveraging efforts and providing
capital for Odyssey through a NAFTA decision.
Odyssey Marine Exploration, Inc. (NASDAQ:OMEX), a global subsea
mineral exploration and development company, provided a corporate
update.
“The second quarter was an important period for Odyssey, as the
company made considerable progress in ensuring the company’s future
as a leader in the exploration and development of critical mineral
resources across the globe. To be clear, ensuring a favorable
outcome in the company’s ongoing NAFTA litigation with Mexico
remains its most important objective. While these efforts have
taken more time and resources than expected, Odyssey is more
optimistic than ever that it will succeed in driving a positive
response for shareholders,” stated Mark Gordon, Odyssey Marine
Exploration’s Chief Executive Officer and Chairman of the
Board.
“In mid-June, Odyssey closed a registered direct offering of
equity securities that has allowed the company to continue to
deleverage its balance sheet while also providing capital for
Odyssey’s ongoing operations and projects. Odyssey expects this
financing to carry the company through a decision on the NAFTA
arbitration,” said Christopher Jones, Odyssey Chief Financial
Officer. “Additionally, the capital will provide for targeted
investments in key mineral projects that will help power the shift
to renewable energy sources.”
“The company reduced debt by over $5.0 million in the quarter.
Importantly, the company remains cautiously optimistic that it will
continue to make progress on this front, both in reducing debt and
extending maturities, to ensure long-term success for the company,”
continued Jones.
“Finally, whether it’s countries seeking to secure phosphate for
fertilizer production or OEMs looking for an alternate supply of
critical metals to power renewable energy technologies, Odyssey
remains focused on developing its already diverse portfolio of
projects that can deliver these resources. Several of our projects
are advancing through the development curve, reducing the risk and
increasing the value associated with these assets. Our research
team is also actively identifying new projects that will leverage
our experience in deep-water exploration and we are currently
evaluating a new project that already has licenses and exploration
results,” finished Gordon.
PROJECT UPDATES
Odyssey’s project development focus is on mineral types that can
be extracted economically with minimal environmental impact while
offering the potential to provide an abundant source of minerals
that will benefit society. The company believes subsea phosphorite
deposits and polymetallic nodule resources are two of the best
options for near-term extraction.
ExO Phosphate Project
Odyssey currently owns 56.3% of this project with an option to
increase equity ownership to 65.0% upon conversion of debt. The
project is currently the subject of a NAFTA arbitration action
against Mexico. Both parties have completed filing all witness
statements, expert reports and evidence in the case. Odyssey’s
filings are available at https://www.odysseymarine.com/nafta. The
final merits hearing took place on May 10, 2022, before the NAFTA
Tribunal. According to the procedural calendar, written closing
arguments will be filed in late August 2022, subject to any short
extensions. Then the evidentiary phase of the case will be closed,
and the Tribunal can begin its deliberations. Odyssey cannot
predict the length of these deliberations or when a ruling will be
issued, but we remain confident in the merits of our case.
Odyssey’s filings demonstrate that the project did not receive fair
and equitable treatment by Mexico resulting in the illegal denial
of the ExO Phosphate Project Environmental Permit. The project’s NI
43-101 highlights the strategic size and grade of the resource, the
operational viability of the project, and the project’s value.
CIC Ocean Research Project (Polymetallic Nodules)
Odyssey currently holds 13.9% of CIC Limited (a company founded
and led by Greg Stemm, Odyssey’s co-founder and former CEO).
Odyssey has the ability to earn up to 20.0 million equity units
over the next several years, which represents an approximate 16.0%
interest in CIC based on the currently outstanding equity units.
This means the company can earn approximately 3.5 million
additional equity units in CIC under our current services
agreement. Odyssey also provides support to the project as a marine
services provider to CIC and as a member of the CIC Consortium,
which includes Royal Boskalis Westminster NV and five other
companies. On February 23, 2022, CIC was awarded a five-year
exploration license by the Cook Islands and commenced exploration
activities in June 2022.
South American Phosphate Project:
Odyssey entered into a Memorandum of Understanding to create a
joint venture (JV) company in which Odyssey will own a 75%
interest. The new company will have exclusive rights to a minimum
of 19 areas (380 km2 of seabed) believed to be highly prospective
for phosphorite deposits in an Exclusive Economic Zone (EEZ) of a
country in South America. Legacy data and desktop research indicate
high-grade phosphate deposits in the concession areas. Pending
execution of the definitive agreement, Odyssey will manage the
overall Phosphate Project development, and the local JV partner
will manage business operations. A related party to the JV partner
will provide marine operations services, supervised by Odyssey. It
is anticipated that the South American deposits can be extracted
with the standard and similar technology and engineering solutions
already identified for the ExO Project, which will allow the
phosphate to be recovered in an environmentally responsible manner
without the addition of any chemicals into the sea.
Lihir Subsea Gold Project
Odyssey’s ownership stake in this project is 85.6%. The license
area is adjacent to Lihir Island, Papua New Guinea, where one of
the world’s largest terrestrial gold deposits is currently being
mined and processed by Newcrest Mining. Further development of this
project is dependent on the characterization of any present
resources during exploration.
About Odyssey Marine Exploration
Odyssey Marine Exploration, Inc. (Nasdaq: OMEX) is a deep-ocean
exploration pioneer engaged in the discovery, validation and
development of subsea mineral deposits in a socially and
environmentally responsible manner. Odyssey’s growing project
portfolio includes different mineral sets in various jurisdictions
around the world. Odyssey also provides marine services for private
clients and governments. For additional details, please visit
www.odysseymarine.com. An investor presentation is available in the
Investors section of the website.
Forward Looking Information
Odyssey Marine Exploration believes the information set forth in
this Press Release may include "forward looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Act of 1934. Certain factors that could cause
results to differ materially from those projected in the
forward-looking statements are set forth in "Risk Factors" in Part
I, Item 1A of the Company's Annual Report on Form 10-K for the year
ended December 31, 2021, which was filed with the Securities and
Exchange Commission on March 31, 2021. The financial and operating
projections as well as estimates of mining assets are based solely
on the assumptions developed by Odyssey that it believes are
reasonable based upon information available to Odyssey as of the
date of this release. All projections and estimates are subject to
material uncertainties and should not be viewed as a prediction or
an assurance of actual future performance. The validity and
accuracy of Odyssey's projections will depend upon unpredictable
future events, many of which are beyond Odyssey's control and,
accordingly, no assurance can be given that Odyssey's assumptions
will prove true or that its projected results will be achieved.
Cautionary Note to U.S. Investors
The U.S. Securities and Exchange Commission (SEC) permits mining
companies, in their filings with the SEC, to disclose only those
mineral deposits that a company can economically and legally
extract or produce. We may use certain terms in this press release,
such as "measured", "indicated," "inferred" and "resources," which
the SEC guidelines strictly prohibit us from including in our
filings with the SEC. "Inferred mineral resources" have a great
amount of uncertainty as to their existence, and great uncertainty
as to their economic and legal feasibility. It cannot be assumed
that all or any part of an inferred mineral resource will ever be
upgraded to a higher category. U.S. investors are cautioned not to
assume that part or all of the inferred mineral resource exists, or
is economically or legally mineable, and are urged to consider
closely the disclosures in our Form 10-K which may be secured from
us or from the SEC's website at http://www.sec.gov/edgar.shtml.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220815005675/en/
Laura Barton Odyssey Marine Exploration, Inc. (813) 876-1776 x
2562 laura@odysseymarine.com
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