Argex Titanium awards Tecnicas Reunidas EPC contract
MONTREAL, March 4, 2015 /CNW Telbec/ - Argex Titanium Inc. (TSX: RGX) ("Argex" or the "Company") an emerging producer of high-grade titanium dioxide (TiO2) used as white pigment in paint, plastic, paper, cosmetics and other applications, announced today that its newly formed, wholly-owned subsidiary, Argex Canada Inc. ("Argex Canada"), has awarded an Engineering, Procurement and Construction contract (the "EPC Contract") to the Tecnicas Reunidas Group ("TR") for Argex's first industrial scale 50,000 tonne per annum Titanium Dioxide (TiO2) plant, which will be located in Salaberry-de-Valleyfield, Canada (the "Project").
The EPC Contract will be performed in two phases. The first phase is the front end engineering design completion (FEED/FEL3) work and the second phase will be for the Detailed Design and Construction portion of the Project. The FEED/FEL3 will be undertaken at TR's headquarters in Madrid based on Argex's basic design process package for an expected cost of USD 10 million. The work on the FEED/FEL3 will only commence upon the issuance of a Limited Notice to Proceed ("LNTP") to be issued once Argex receives the financing for the FEED/FEL3. If such LNTP is not issued by Argex Canada by June 29, 2015, TR may elect to terminate the EPC Contract. Upon completion of the FEED/FEL3, the parties will agree on a guaranteed target contract price ("GTCP") for the Construction portion of the work
The GTCP will be based on a 50/50 shared cost savings/overrun approach between Argex Canada and TR. The GTCP's expected value will be determined during the Initial Period but the overall value of the EPC Contract (including the FEED/FEL3 portion) is currently estimated at approximately USD 200 million.
"The finalization of the EPC Contract represents an important step in the realization of our Project," stated Richard Poulin, Executive Vice President of Argex, "Tecnicas Reunidas' deep experience in similar projects and TR's know-how acquired from its own in-house solvent extraction technology facility represent an important value-added to the construction of our Valleyfield facility. "
The Tecnicas Reunidas Group is an international general contractor, engaging in the engineering, design and construction of various types of industrial facilities for a broad spectrum of customers throughout the world, including many of the principal national oil companies as well as several multinational companies.
Most of TR's business is concentrated on large turnkey industrial projects, although they also provide engineering, management, start-up and operating services for industrial plants. Since 1960, the TR group of companies has designed and built more than 1000 industrial plants worldwide.
TR's multinational clients and licensors include the world's leading companies. The projects have been developed in over 50 countries covering the six continents. International projects account for 78% of the company's annual turnover.
About Argex Titanium
Argex Titanium Inc. has developed an advanced chemical process for the volume production of high grade titanium dioxide (TiO2) for use in high quality paint, plastics, cosmetics and other applications.The company's unique proprietary process takes relatively inexpensive and plentiful source material from a variety of potential vendors, and produces TiO2 along with other valuable by-products. Argex's process provides a significant cost and environmental advantage over current legacy TiO2 production methods. The company's primary near term goal is to rapidly advance toward a 50,000 tonne per annum production module as a first step in its goal to transform the 5.2 million tonne per annum TiO2 industry.
Forward-Looking Statements
This news release contains statements that may constitute "forward-looking information" or "forward-looking statements" within the meaning of applicable Canadian securities legislation. Forward-looking information and statements may include, among others, statements regarding future plans, costs, objectives or performance of Argex, or the assumptions underlying any of the foregoing. In this news release, words such as "may", "would", "could", "will", "likely", "believe", "expect", "anticipate", "intend", "plan", "estimate" and similar words and the negative form thereof are used to identify forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits Argex will derive. Forward-looking statements and information are based on information available at the time and/or management's good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond Argex's control. These risks, uncertainties and assumptions include, but are not limited to, those described under "Risk Factors" in Argex's Annual Information Form for the fiscal year ended December 31, 2013, which is available on SEDAR at www.sedar.com; they could cause actual events or results to differ materially from those projected in any forward-looking statements. Argex does not intend, nor does Argex undertake any obligation, to update or revise any forward-looking information or statements contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable laws.
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SOURCE Argex Titanium Inc.
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