15th Apr 2024 10:17
(Alliance News) - Blencowe Resources PLC on Monday reported "significant progress" on its definitive feasibility study work for its project in Uganda.
The developer of the Orom-Cross graphite project said this included a 600 tonne bulk sample test work at the Jilin Huiyang New Material Technology Co Ltd facility in China.
This marks a "significant step forward" for the Orom-Cross DFS, Blencowe said, with the same facility having previously conducted successful bulk metallurgical test work for Blencowe on the 100-tonne Orom-Cross sample in 2023.
Blencowe said it plans to utilise this product to generate large volumes of both 96% concentrate and 99.95% uncoated spheronised purified graphite product for final qualification with potential off-take partners.
It said this process "aims to maintain the same consistently high quality as previously delivered via this commercial-scale production process in 2023".
Senior management will visit both China and South Korea over the next few weeks to continue discussions on offtake agreements, Blencowe said, noting strong interest having been shown to date.
Blencowe said it is confident that this will continue with the ongoing large-scale test work.
Blencowe Executive Chair Cameron Pearce commented: "This latest 600 tonne bulk sample testing is a critical part of our DFS. We aim to demonstrate that end products maintain the same high quality and purity in commercial scale processing that have already been achieved in all previous testing to date.
"We are making significant progress across all DFS objectives. Orom-Cross is a world class graphite project with unique characteristics, and its potential is becoming increasingly evident as we deliver each milestone."
Jangada Mines PLC, a mining project development company with interests in Brazil and elsewhere, reported it was "pleased" with Blencowe's announcement. Jangada owns around 10% of Blencowe.
Jangada Executive Chair Brian McMaster commented: "Blencowe's progress across all its DFS objectives highlight Orom-Cross as a world-class graphite project with unique potential. This latest bulk sample testing is particularly pivotal as it looks to provide sufficient quantities of 99.95% spheronised purified graphite for testing with tier one offtakers to qualify its product.
"We look forward to receiving further updates as Blencowe focuses on delivering significant incremental upside to the project's already strong economics: a 2022 PEA indicated a long-life, high margin, low capital cost mining operation with a post-tax [net present value] of USD482 million."
Shares in Blencowe were up 6.8% to 5.08 pence each in London on Monday morning, while Jangada shares were untraded and quoted at 1.55p each.
On Wednesday last week, Blencowe received the third tranche of its grant from the US International Development Finance Corp, to fund work on the Orom-Cross graphite project in Uganda.
The USD1.0 million tranche payment represents 20% of the total USD5.0 million grant due to be given by the DFC to the mineral exploration and development company.
Blencowe has received USD3.0 million of the grant since the agreement was finalised in September 2023 for its work on the Orom-Cross definitive feasibility study.
The Orom-Cross graphite project was issued by the Ugandan government in 2019. Blencowe hopes to establish a downstream processing facility that would upgrade the purity of the graphite.
This graphite upgrade would more than quadruple the value of the small flake concentrate, increasing it to USD2,500 per tonne from USD600.
Blencowe also completed a successful pre-feasibility study for the project in July 2022.
By Greg Rosenvinge, Alliance News senior reporter
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