TIDMACP
Armadale Capital Plc / Index: AIM / Epic: ACP / Sector:
Investment Company
21 February 2020
Armadale Capital Plc ('Armadale' or 'the Company')
Project Update
Armadale Capital plc (LON: ACP), the AIM quoted investment group
focused on natural resource projects in Africa, is pleased to
provide an update on the Mahenge Liandu graphite project ('Mahenge'
or 'the Project') in south-east Tanzania as it progresses towards
commercialisation in line with the group's transformation from
explorer to emerging producer.
Highlights
-- Definitive feasibility study ('DFS') is on track to be completed in this
quarter (Q1 2020) following inclusion of results from the following work
studies:
-- A detailed mine plan that will target high-grade, near surface
graphite mineralisation for the first 3-5 years of production.
This aims to maximise the returns in the early years of operations
and is nearing completion
-- The study will include a ramp up from 400ktpa to 1mtpa throughput
after 4 years which will maximise the value of the project as
demand for graphite continuing to increase
-- A final round of metallurgical test-work is being completed at
Bureau Veritas, in Perth, on high-grade composites of the diamond
core with average grades of 14.9% and 15.6% Total Graphitic Carbon
('TGC'). This is to confirm the flowsheet is suited to high grade
ore
-- Site locations for the ROM pad, crushing circuit, process plant
and tailing storage facilities have been finalised and a new
access road has been marked out from site to the town of Mahenge
to facilitate mine construction as well as mine production
-- Logistics for the operation have been costed with a local
well-established Tanzanian contractor to truck the product from
site to Dar es Salaam, where it will then be containerised for
shipping
-- The results of the work programme will be the final part of the
definitive feasibility study which is on track to be completed in
March
-- ACP director, Steve Mahede, recently met with senior Tanzanian officials
and was confident that developing the mining projects through to
production was a major priority to generate export earnings as well as
positive economic multiplier benefits
-- Commencing post-DFS era work programmes, with teams working on road
access, production bores, ongoing commercialisation and project funding
discussions with funding partners
Armadale Chairman, Nick Johansen, said: "With one of the largest
high-grade resources in Tanzania this dovetails perfectly with our
ongoing commitment to push the envelope to transform into an
emerging producer by H1 2021.
"In support of this, refinements to our resource modelling and
mine plan from the scoping study have increased our confidence that
the project is going to be a low cost, long life operation.
"We look forward to sharing these key value metrics within the
next month as we finalise the DFS, results for which we know are
eagerly anticipated. I would like to thank shareholders for their
patience in this regard and give my assurance that finalising this
study is our primary objective. We will then look to accelerate
commercialisation and funding initiatives with our partners to
ensure we remain on track with our fast-paced growth plans."
Mahenge Liandu Graphite Project, Tanzania
Armadale's wholly-owned Mahenge Liandu Graphite Project is
located in a highly prospective region, with a high-grade JORC
compliant indicated and inferred mineral resource estimate
announced October 2019 -- 59.5Mt at 9.8% TGC. This includes 11.5Mt
@ 10.5% Measured 32.1Mt Indicted at 9.6% and 15.9Mt at 9.8% TGC,
making it one of the largest high-grade resources in Tanzania.
The work to date has demonstrated the Project's potential as a
commercially viable deposit, with significant tonnage, high-grade
coarse flake and near surface mineralisation (implying a low strip
ratio) contained within one contiguous ore body.
Currently, Armadale Capital is completing a Definitive
Feasibility Study based on the results of a Scoping Study that was
completed in March 2018. The study was based on a throughput of
400,000tpa over a 32-year mine life and showed the project has
robust economics and warrants further development.
The Scoping Study verified the Mahenge Liandu Project could
produce a coarse flake, high-purity graphite product underpinning a
compelling business case to progress commercialisation plans.
The Scoping Study, based on a 400,000tpa throughput, highlighted
the following key positive metrics:
-- Producing an average of 49,000tpa of high-quality graphite products for a
32-year mine life;
-- The near surface nature of the deposit produced a low 1:1 strip ratio for
the life of the mine;
-- The Project has a low operating cost of US$408/t, based on an average
12.5% TGC life of mine grade;
-- The Project has a pre-tax IRR of 122% and NPV of US$349m, with a low
development capex of US$35m; and
-- The maximum draw-down during the construction of the project is US$34.9m
and the after-tax payback period is 1.2 years.
There remains significant scope to further improve returns, with
staged expansions as the current mine plan is based on circa 25% of
the total resource.
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
**ENDS**
Enquiries:
Armadale Capital Plc
Nick Johansen, Non-Executive Director
Tim Jones, Company Secretary +44 (0) 20 7236 1177
Nomad and broker: FinnCap Ltd
Christopher Raggett / Simon Hicks +44 (0) 20 7220 0500
Joint Broker: SI Capital Ltd
Nick Emerson +44 (0) 1483 413500
Press Relations: St Brides Partners Ltd
Charlotte Page / Beth Melluish +44 (0) 20 7236 1177
Notes
Armadale Capital Plc is focused on investing in and developing a
portfolio of investments, targeting the natural resources and/or
infrastructure sectors in Africa. The Company, led by a team with
operational experience and a strong track record in Africa, has a
strategy of identifying high growth businesses where it can take an
active role in their advancement.
The Company owns the Mahenge Liandu graphite project in
south-east Tanzania, which is now its main focus. The Project is
located in a highly prospective region with a high-grade JORC
compliant Indicated and inferred mineral resource estimate of
59.48Mt @ 9.8% TGC, making it one of the largest high-grade
resources in Tanzania, and work to date has demonstrated Mahenge
Liandu's potential as a commercially viable deposit with
significant tonnage, high-grade coarse flake and near surface
mineralisation (implying a low strip ratio) contained within one
contiguous ore body.
Other assets Armadale has an interest in, include the Mpokoto
Gold project in the Democratic Republic of Congo and a portfolio of
quoted investments.
More information can be found on the website
www.armadalecapitalplc.com.
View source version on businesswire.com:
https://www.businesswire.com/news/home/20200220005513/en/
CONTACT:
Armadale Capital Plc
SOURCE: Armadale Capital Plc
Copyright Business Wire 2020
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February 21, 2020 02:00 ET (07:00 GMT)
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