ELEMENT ASA: DIVESTMENT OF MINDORO NICKEL PROJECT
Oslo - 28 May 2020 - Element ASA (the "Company") today announces that it has entered into and consummated an agreement for the divestment of all of its ownership interests in the Mindoro Nickel Project, which are held in several legal entities in the Philippines ("Filipino Entities").

The Mindoro Nickel Project is a large nickel-laterite deposit located on the island of Mindoro in the Philippines, containing geologic resources that have been explored since 1996 by the Company and its predecessors. However, the Mindoro Nickel Project has for long been subject to a mining ban which has caused a halt to the Company's development activities in the Philippines.

Over the last years, Element has been actively seeking to sell the Filipino Entities and is now pleased that a sale of all such entities have been completed. The Company has received a symbolic purchase price for the Filipino Entities; however, the purchase price may increase to USD 1 million if the abovementioned mining bans are lifted within five years following the consummation of the transaction.

The Filipino Entities have been sold to a local Philippine company on an "as-is, where-is"-basis, and the buyer has assumed all the Company's liabilities related to the Mindoro Nickel Project.

About the rationale for selling the shares in the Filipino Entities Geir Johansen, CEO of Element says: “We are very happy to finally be able to announce the sale of all our legal entities in the Philippines. We have initially received a symbolic payment for the sale, however the important thing for the Company, is to separate the Element group from the activities of the Filipino Entities. The buyer has assumed all risk, both past, present, and future and will pay another USD 1 million to Element if the mining ban in the Philippines is lifted within the next 5 years”.

Additionally, Element was spending USD 700.000 – 1.000.000 annually to keep the organization in the Philippines running while waiting for the mining ban to be lifted. If the ban was to be lifted, development of the Mindoro Nickel Project would require investments of several hundred million USD, an amount all but impossible for Element to finance, says Geir Johansen, Chief Executive Officer of Element”

“This transaction marks the end of Element’s restructuring process which we started back in 2019. We have refocused the company away from mining through the sale of CMT, AMI and now also the Mindoro Nickel Project. Adding the successful termination of the ABO loan agreement in December 2019, Element is now a “clean” publicly listed company with no legacy risks related to the Filipino Entities, 3200 shareholders and total assets of some USD 7 million including NOK 15-20 million in cash. Going forward, Element will focus on block chain related investments and the strategic alternatives that could open up from this announcement, says Thomas Christensen, chairman of Element”.


For further information, please contact:

Geir Johansen
CEO
E-mail: gj@elementasa.com
+47 4771 0451

Thomas Christensen
Chairman
+47 9225 5444