Armadale Capital Plc AGM Statement
27 June 2019 - 4:00PM
UK Regulatory
TIDMACP
Armadale Capital Plc / Index: AIM / Epic: ACP / Sector:
Investment Company
27 June 2019
Armadale Capital Plc ('Armadale' or 'the Company')
AGM Statement
Armadale Capital plc (LON: ACP) the AIM quoted investment
company focused on natural resource projects in Africa, is holding
its annual general meeting ('AGM') at 11.00 am today at Salisbury
House, London Wall, London EC2M 5QQ. At the meeting, Paul Johnson,
Non-Executive Director of Armadale, will make the following
statement:
"We continue to make excellent progress advancing our key,
actively managed investment, the Mahenge Liandu Graphite Project
('Mahenge Liandu' or 'the Project') in Tanzania, towards first
production in 2021. The Project, which is owned 100% by Armadale,
is situated in a highly prospective graphite region with a
high-grade JORC Compliant Indicated and Inferred Mineral Resource
Estimate of 51.1Mt at 9.3% total graphite content ('TGC'),
including 38.7Mt Indicated at 9.3% and 12.4Mt at 9.1% TGC. This
makes Mahenge Liandu one of the largest high-grade graphite
resources in Tanzania; a resource upgrade is expected to be
announced in the near-term which will further consolidate our
already attractive project credentials.
"Our 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, all contained within
one contiguous ore body. The Scoping Study we completed in March
2018 further proved up the robust economics of the Project,
delivering an NPV of US$349m and IRR of 122%. The Project capex
drawdown was US$35m, demonstrating the potential for an extremely
low project development cost, with a payback estimated of 1.2 years
and a 32-year life of mine.
"Based on these encouraging Scoping Study results, we commenced
a Definitive Feasibility Study ('DFS') in Q2 2018 to confirm the
commercial viability of the deposit. The DFS is focusing on
defining graphite product quality with a wide diameter diamond core
drilling programme aimed at generating samples for marketing. In
line with this, on Tuesday, we announced assay results of the first
four of an 18-hole reverse circulation ('RC') drill programme,
which show exceptionally high-grade near surface intercepts. These
encouraging results are part of broader zone of high-grade
mineralisation and are expected to have a positive outcome on the
DFS, aiding our transition from exploration to mining phase.
"Eight diamond drill-holes have also been drilled and are
currently being assayed to produce a concentrate that will enable
completion of the final plant design that will be used in the DFS;
results of this test work are expected in the near-term. The
concentrate samples, along with the high-grade RC core already
received will be used to assist commercial discussions and for
downstream product test work. I'm pleased to say that commercial
discussions are progressing positively; in February this year, we
announced a MOU with the Matrass Group, a China based graphite
mining and processing company for high quality graphite products
produced at Mahenge Liandu. The MOU includes a proposed offtake of
30,000tpa of graphite concentrate for an initial five-year term,
representing over 60% of average target annual production. Key
meetings with current and prospective Chinese offtake and project
finance partners are taking place with the intention to progress to
binding agreements as part of our commitment to accelerating
commercialisation plans.
"Our various other work streams to support the DFS are all
progressing positively with overall completion of the study
expected in Q4 2019. These activities include environmental and
social studies covering the Project area and completion of a
Relocation Action Plan; granting of a mining permit; a geotechnical
drilling programme to define the final pit wall design; calculation
of Proved and Probable Reserves; and finalisation of production
flowsheets and final plant design parameters. Our work at Mahenge
Liandu is underpinned by strengthening graphite market fundamentals
driven by demand for spherical graphite from the new energy sector
as well as emerging demand for expandable graphite used in products
such as fireproof insulation.
"Whilst the advancement of Mahenge Liandu into production is the
Board's primary focus, and one which we believe will deliver
significant value for shareholders, we continue to maintain and
review Armadale's small portfolio of quoted investments,
principally in resource companies where the Directors believe there
are opportunities for capital gain. In line with this, in January
2019, Armadale entered into an agreement with African Royalty
Company Pty Limited, a related company to Arrow Mining Pty Ltd, for
the sale of the Mpokoto Gold Project. Under the terms, we will
receive a 1.5% royalty on gold sales achieved once the project is
in production, ensuring the Company retains exposure to the
development upside. Furthermore, Armadale maintains an ongoing
review of other company and project level investments that may
complement its existing portfolio.
"I would like to take this opportunity to thank our shareholders
for their ongoing support and I look to the coming year with
optimism as we work to realise the exceptional potential of Mahenge
Liandu."
**ENDS**
For further information, please visit the Company's website
www.armadalecapitalplc.com, follow Armadale on Twitter
@ArmadaleCapital or contact:
Enquiries:
Armadale Capital Plc +44 (0) 20 7236 1177
Paul Johnson, Non-Executive Director (UK)
Tim Jones, Company Secretary
Nomad and broker: finnCap Ltd +44 (0) 20 7220 0500
Christopher Raggett / Max Bullen-Smith
Joint Broker: SI Capital ++44 (0) 1483 413500
Nick Emmerson
Press Relations: St Brides Partners Ltd +44 (0) 20 7236 1177
Isabel de Salis / Juliet Earl
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
51.1Mt @ 9.3% 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.
View source version on businesswire.com:
https://www.businesswire.com/news/home/20190626005632/en/
This information is provided by Business Wire
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