9th Dec 2019 13:43
(Alliance News) - Savannah Resources PLC on Monday said it has secured a mining concession for the Mutamba heavy minerals sands project from the Mozambique government.
The diversified resources group said the minister of Mineral Resources & Energy has issued Mining Licence 9735C to its subsidiary Matilda Minerals Lda. The licence covers 11,948 hectares. It is valid to April 2044 and includes a 25-year extension option.
The company, which operates the Mutamba project in a joint venture with mining major Rio Tinto PLC, said the licence is the first of the three permits to be issued and will result in the full tenement permitting of Mutamba.
Savannah currently holds a 20% interest in the Mutamba project but can increase its stake to 35% upon delivery of the a pre-feasibility study and ultimately to 51% upon delivery of a feasibility study. The project contains an indicated and inferred mineral resource of 4.4 billion tonnes, grading 3.9% total heavy minerals.
David Archer, Savannah's chief executive, said: "We are delighted with the issue of the first concession by the government of Mozambique, and now look forward to the issue of the remaining two mining licences, 9229CC and 9228C. When combined, these three concessions contain an indicated and inferred mineral resource of 4.4 [billion tonnes] at 3.9% total heavy minerals; this makes Mutamba one of the most attractive undeveloped mineral sands deposits in the world."
"Our focus is now on progressing the pre-feasibility study at Mutamba towards completion, which, upon delivery, will trigger the increase in our interest in the Project from 20% to 35%," Archer added.
Savannah shares were up 9.3% at 2.35 pence each in London on Monday afternoon. Rio Tinto's shares were 1.3% higher at 4,272.00p each.
By Tapan Panchal; [email protected]
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