16th Apr 2019 13:04
LONDON (Alliance News) - African natural resource investor Armadale Capital PLC on Tuesday said "significant progress" has been made at the Mahenge Liandu graphite project in Tanzania.
Shares in Armadale were down 13% at 1.40 pence in early afternoon trade.
A definitive feasibility study on Mahenge Liandu is due in the fourth quarter of 2019, following on from a scoping study that found a USD349 million net present value at the project.
The scoping study also suggested a development capital expenditure of USD35 million for Mahenge Liandu, with a pretax initial rate of return of more than 100% and a 32-year mine life.
The remaining work on Mahenge Liandu is underway and includes marketing, logistics, and a resource update. The environmental social impact assessment for the project, as well as the relocation action plan, have been finalised and will likely be submitted in April.
With work now underway to upgrade this Resource to declare a Maiden Reserve, the potential of the Project is set to increase. We are now working on securing the mining permit and completing the Definitive Feasibility Study which will allow us to make the decision to mine and ultimately advance Mahenge Liandu into production.
Armadale Non-Executive Director Nick Johansen noted that Mahenge Liandu "is one of the highest-grade large flake deposits globally" and has a current JORC resource of 51.1 million tonnes at 9.3% total graphitic carbon.
"With work now underway to upgrade this resource to declare a maiden reserve, the potential of the project is set to increase. We are now working on securing the mining permit and completing the definitive feasibility study which will allow us to make the decision to mine and ultimately advance Mahenge Liandu into production," Johansen said.
"We are encouraged by the strengthening graphite market which has been reflected across a number of comparable graphite-projects that are securing project finance and advancing to mine construction. The Tanzanian government is now actively recognising the requirement for foreign investment in the mining sector and we are pleased to note the accommodating investment conditions," he added.
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