GreenX Metals Limited ANNUAL REPORT 2023
All of these activities are inherently risky and the Board is unable to provide certainty of the expected results of
these activities, or that any or all of these likely activities will be achieved. Furthermore, GreenX will continue to
take all necessary actions to preserve the Company’s rights and protect its investments in Poland, if and as
required. The material business risks faced by the Group that could have an effect on the Group’s future prospects,
and how the Group manages these risks, include the following:
• Litigation risk – All industries, including the mining industry, are subject to legal and arbitration claims.
Specifically, and as noted above, the Company is continuing with its Claim against the Republic of Poland,
and will strongly defend its position and will continue to take all relevant actions to pursue its legal rights in
the Claim process. During the period, the hearing for the Claim was completed with Tribunal to render an
Award (i.e., a decision) in due course with no specified date available for the Tribunal decision. There is
however no certainty that the Claim will be successful. If the Claim is unsuccessful, then this may have a
material impact on the value of the Company’s securities.
• Earn-in and joint venture contractual risk – The Company's earn-in right to the ARC is subject to the EIA with
Greenfields as announced in October 2021. The Company’s ability to achieve its objectives is dependent on it
and other parties complying with their obligations under the EIA. Any failure to comply with these obligations
may result in the Company not obtaining its interests in ARC and being unable to achieve its commercial
objectives, which may have a material adverse effect on the Company’s operations and the performance and
value of the Shares. There is also the risk of disputes arising with the Company’s joint venture partner,
Greenfields, the resolution of which could lead to delays in the Company's proposed development activities
or financial loss.
If and when the Company earns in its interest in the ARC, an incorporated joint venture will be established
between the Company and Greenfields. The nature of the joint venture may change in future, including the
ownership structure and voting rights in relation to ARC, which may have an effect on the ability of the
Company to influence decisions on ARC.
With regards to the Option Agreement for ELN, it should be noted that the Option Agreement is subject to
a number of conditions precedent including the payment of the option fee by the Company and there is a
risk that the transaction may not complete and the Company will not acquire the ELN project.
• Operations in overseas jurisdictions risk – ELN and ARC are located in Greenland, and as such, the operations
of the Company will be exposed to related risks and uncertainties associated with the country, regional and
local jurisdictions. Opposition to the projects, or changes in local community support for the projects, along
with any changes in mining or investment policies or in political attitude in Greenland and, in particular to
the mining, processing or use of copper, may adversely affect the operations, delay or impact the approval
process or conditions imposed, increase exploration and development costs, or reduce profitability of the
Company. Moreover, logistical difficulties may arise due to the assets being located overseas such as the
incurring of additional costs with respect to overseeing and managing the projects, including expenses
associated with taking advice in relation to the application of local laws as well as the cost of establishing a
local presence in Greenland. Fluctuations in the currency of Greenland may also affect the dealings and
operations of the Company.
Failure to comply strictly with applicable laws, regulations and local practices relating to mineral rights
applications and tenure, could result in loss, reduction or expropriation of entitlements, or the imposition of
additional local or foreign parties as joint venture partners with carried or other interests. Further, the
outcomes in courts in Greenland may be less predictable than in Australia, which could affect the
enforceability of contracts entered into by the Company.
The projects are remotely located in an area that has an arctic climate and that is categorised as an arctic
desert, and as such, the operations of the Company will be exposed to related risks and uncertainties of arctic
exploration, including adverse weather or ice conditions which may and has prevented access to the projects,
which can impact exploration and field activities or generate unexpected costs. It is not possible for the
Company to predict or protect the Company against all such risks.
The Company also had previous operations in Poland which may be subject to regulations concerning
protection of the environment, including at the Debiensko and Kaczyce projects which have both been
relinquished by the Company. As with all exploration projects and mining operations, activities will have an
impact on the environment including the possible requirement to make good any disturbed or damaged
land.
Existing and possible future environmental protection legislation, regulations and actions could cause
additional expense, capital expenditures and restrictions, the extent of which cannot be predicted which
could have a material adverse effect on the Company's business, financial condition and results of operations.