TIDMKIBO
RNS Number : 7243P
Kibo Mining Plc
07 October 2011
KIBO MINING PLC
Operational Update
Dated: 7 October 2011
Kibo Mining plc ("Kibo" or the "Company") (AIM: KIBO, AltX: KBO)
the mineral exploration and development company focused on gold and
nickel projects in Tanzania, is pleased to provide an operations
update. The Company has more than doubled its licence area in
Tanzania to over 18,000 square kilometres in the last six months
gaining a strategic position in both the Lake Victoria Goldfields
and the emerging gold districts of eastern Tanzania. This has
necessitated a major re-organisation of its operations in Tanzania
to meet the demands of exploring and managing a large
geographically dispersed licence portfolio effectively. This
re-organisation is now complete and field exploration programmes
have re-commenced.
Summary Highlights
-- the Board has approved a GBP5.3M exploration programme to
evaluate the Lake Victoria, Haneti and Morogoro projects;
-- Stage 1, with a budget of GBP1.3M, is now being implemented.
Gold and nickel are the primary targets;
-- the Company has completed the integration of its exploration
office and staff with Mzuri Exploration Services ("MXS"). This will
increase its capacity to implement fully supported contemporaneous
multi-project field programmes;
-- the Company has received the final results from metallurgical
testing at the Golden Horseshoe Reef deposit (the "GHR") which
indicate high gold recoveries; and
-- negotiations are underway with Tanzanian Royalty Exploration
Corporation Limited ("TREC") and a financial institution to allow
the Company to immediately exercise its option over the Itetemia
and Luhala projects and to work on securing debt and equity
financing to advance mine development at the GHR.
The Company is progressing on two fronts:
(a) exploration to evaluate its large ground holding and focus
on priority areas to quickly define target areas for Stage 2
drilling; and
(b) evaluation of whether it can bring forward the immediate
exercise of its option over the Itetemia and Luhala projects and
proceed with developing a mine on the the GHR deposit which has a
JORC-compliant mineral resource of 422,000 oz. of gold.
The exploration is underway as are negotiations of the terms of
its agreement with TREC for immediate exercise of its option on
Itetemia and Luhala and with a financial institution to secure debt
financing for the development of the GHR.
Noel O'Keeffe, CEO of Kibo commented:
"The Board is pleased to provide this operational update
following a period of corporate and operational re-structuring
during 2011 to meet the demands of a significantly expanded
exploration property foot print in Tanzania.
We are excited by the exploration opportunities offered by our
expanded licence portfolio both in the gold prolific Lake Victoria
Goldfield and the newly emerging areas in eastern Tanzania. Now
that field programmes have re-commenced, we look forward to
updating the Shareholders on a regular basis as exploration results
emerge.
We will also update Shareholders on the results of our on-going
negotiation with TREC and a financial institution which will allow
the Board to make a definitive decision on its plans for Itetemia
and Luhala".
Tanzanian operations overview
The Company has appointed Dar es Salaam based MXS to manage its
field programme implementation and tenement portfolio. Kibo's
Tanzanian employees have been integrated into the MXS operational
structure where they will continue in their previous roles
providing geological and financial management for Kibo's
operations. MXS provide strong project and financial management, IT
and government liaison skills which will be crucial to Kibo's
success as one of the largest licence holders in the country.
The Board has approved a GBP5.3M exploration programme (Table 1)
to be implemented in two stages over a 3 year period. Stage 1 has
commenced with the mobilisation of field teams for a GBP1.3M work
programme to be implemented over the next 7 months on the Lake
Victoria, Haneti and Morogoro projects. These projects encompass a
substantial land area in excess of 18,000 square kilometres and the
programmes will concentrate on the most prospective licences
prioritised by a combination of geological setting, proximity to
existing deposits and areas of anomalous geochemical results from
previous surveys. The programmes will be conducted by three
exploration teams assigned to ensure contemporaneous progress on
all projects and staffed by the Company's existing employees with
recruitment of additional personnel as required. The field teams
will be under the direct supervision of MXS Exploration Manager,
Bertie Peppler, a South African geologist with significant
Tanzanian experience.
Table 1: Kibo Exploration Budget 2011 -2014
Stage1 Stage 2
Project Sub-project Budget Budget Total
----------- ----------------- ---------- ---------- ----------
GBP GBP GBP
----------- ----------------- ---------- ---------- ----------
Lake
Victoria Mahangu 141,000 1,180,000 1,321,000
----------- ----------------- ---------- ---------- ----------
UN Road 57,000 500,000 557,000
----------------------------- ---------- ---------- ----------
Geita East 57,000 110,000 167,000
----------------------------- ---------- ---------- ----------
Geita West 57,000 80,000 137,000
----------------------------- ---------- ---------- ----------
Geita North 57,000 140,000 197,000
----------------------------- ---------- ---------- ----------
Central 57,000 130,000 187,000
----------------------------- ---------- ---------- ----------
Haneti 450,000 700,000 1,150.000
------------------------------ ---------- ---------- ----------
Morogoro Morogoro South 200,000 600,000 800,000
----------- ----------------- ---------- ---------- ----------
Morogoro North
(Dodoma Block) 200,000 600,000 800,000
----------------------------- ---------- ---------- ----------
Total 1,276,000 4,040,000 5,316,000
------------------------------ ---------- ---------- ----------
The field teams will operate from the Company's exploration
office in Mwanza which is convenient to the Lake Victoria project
and from temporary exploration camps which are being established in
the Morogoro-Dodoma area to facilitate work on the Morogoro and the
Haneti projects.
Maps and more detailed descriptions of the projects are
available on the Kibo website (http://kibomining.com/en/home) under
the "Project" sub-menu and within the Venmyn Competent Person's
Report (Corporate /Documents sub-menu) which forms part of the
Pre-Listing Document prepared for the Company's admission to the
JSE in June this year. This link should be consulted to accompany
the summary of the Company's near-term exploration plans discussed
below.
Haneti
Field exploration at Haneti will follow up on the anomalous
nickel values obtained to date from soils, pitting and trenching in
the Kwahemu, Yobo, Mihanza and Mwaka hill areas east of Haneti
Village. Previously reported results include 93m at 0.4% nickel
from Mwaka Hill and an open soil anomaly with values of 0.1% to
0.3% nickel at Kwahemu Hill. The programme will focus on
establishing the depth, composition and nickel concentrations in
the laterite profiles preserved on these hills by extension of
previous soil sampling grids, pitting, trenching and RAB drilling.
Ground EM surveying over Mihanza and Mwaka Hill will also be
carried out in order to more accurately assess nickel sulphide
targets for drilling. Results emerging from work on these areas
will be used to set the technical specifications for an aerial
geophysical survey which is planned to locate additional nickel
sulphide drill targets within the 80 kilometre long Haneti-Itiso
Ultramafic Complex.
The work proposed for Haneti provides for a focused follow up
programme in an area which the Company has been exploring over the
last few years and which will now receive the more sustained field
programme that it warrants. The Dutwa laterite deposit (African
Eagle Resources), and the nickel sulphide Kabanga (Barrick/Xstrata)
and Nachingwea (Continental Nickel) deposits in Tanzania provide
strong evidence for the prospectivity of Haneti for similar styles
of mineralisation.
The southern and western part of the Haneti project is
prospective for gold mineralisation as evidenced by Shanta Gold's
Singida deposit (approx. 1M oz. at 1.5 grams per tonne) located
just outside the western border of the project, artisanal gold
mining activity within the westernmost project tenement and
evidence from recent geological mapping by the Company for the
extension of the gold hosting Londoni Greenstone Belt
south-eastwards into the southern part of the Haneti block. The
Company is awaiting the issue of prospecting licences on two long
outstanding Letters of Offer for the two westernmost Haneti
tenements.
Lake Victoria
Work on the Lake Victoria project will focus on areas where
previous reconnaissance soil, stream and regolith sampling has
produced anomalous gold values. The areas selected for initial
follow up occur within the Mhangu sub project tenement block.
Specific work activity on these areas will comprise detailed infill
soil sampling, pitting, further regolith mapping and geological
mapping. Concomitant with the work on these priority areas,
geological appraisal of the remaining large number of licences
within the other sub-project tenement blocks is on-going in order
to streamline the portfolio and generate a pipeline of projects for
systematic detailed sampling and definition of drill targets. The
Stage 1 budget for Lake Victoria and Morogoro does not provide for
drilling expenditure which is contingent on encouraging results
emerging from the first pass surveying. Operational flexibility
will allow for early drilling of gold targets where warranted.
The primary objective of stage 1 exploration on the Lake
Victoria project is to follow up on areas of high gold-in-soil
anomalies from licences within the Mhangu block in order to
establish robust targets for drilling and most expenditure is
allocated to this block which is adjacent to significant gold
deposits at Nyanzaga (4.1 M oz. gold resource), Kitongo (300,000
oz. gold resource) and Kibo's option property Luhala (112,000 oz,
gold resource). Expenditure on the other sub-project blocks will be
directed towards first pass geological evaluation by prospecting
and mapping on licence areas that have not been field checked and
infill soil geochemical surveys in areas showing regional gold
anomalism from previous surveys.
Morogoro
Kibo's Morogoro project is located in one of the most exciting
new non-traditional gold exploration area to emerge in Tanzania in
the last few years. The Company holds, licences, offers and
applications covering an area of almost 9,000 square kilometres
separable into two regional blocks, Morogoro South and Morogoro
North (Dodoma Block). The geology of these areas differs from the
Lake Victoria area further north in that higher grade metamorphic
rocks such as gneisses, granulites and marbles dominate.
Morogoro South comprises tenement areas south and west of the
regional town of Morogoro covering approximately 4,900 square
kilometres. The Company's initial exploration focus will be on a
regional geological structure, the Ruvu Nappe, located circa 30 km
southwest of Morogoro. Previous reconnaissance geological mapping
and stream sediment sampling have revealed gold mineralisation
associated with this structure along 45 kilometres of its length
and both artisanal hard rock and placer gold mining is on-going.
Stage 1 field exploration in this area will comprise regional
stream sediment sampling, prospecting and geological mapping to
resolve areas for follow-up geophysical surveying, trenching and
drilling. A large anorthosite body approximately 25 kilometres west
of the Ruvu Nappe, is possibly indicative of nickel-PGM
mineralisation potential in this region and will also be prospected
and sampled during the field programme. Company licence
applications and offers in the western part of the Morogoro Block
cover part of a copper mineralised province with numerous copper
occurrences and some artisanal copper production. Data on the
detailed geology and copper mineralisation styles will be compiled
as they also represent an excellent mineral exploration opportunity
for the Company in this region.
Morogoro North (Dodoma Block) comprises mineral tenements east
of Dodoma covering approximately 4,000 square kilometres adjacent
to Government designated artisanal gold mining blocks. Gold mining
within these blocks is from quartz reefs within high grade gneisses
and granulites of high metamorphic grade. These reefs extend on to
Company licences and applications where some artisanal mining is
on-going. The detailed geology and gold mineralisation in these
areas has not yet been thoroughly evaluated but the data that is
available is consistent with geology and mineralisation styles
similar to those present at the Canaco Resources, Magambazi gold
deposit some 50 kilometres to the northeast. Stage 1 field
exploration at Morogoro North will comprise detailed infill soil
sampling and mapping on prospecting licences around the villages of
Gairo, Kilama and Berega where gold-in-soil anomalies from previous
reconnaissance sampling occur.
Metallurgical Testing of the GHR Deposit
Metallurgical test work was carried out by Mintek in South
Africa on four samples of the GHR ore recovered from artisanal pits
at the site. The samples were carefully selected to represent
oxidised, transitional and fresh ore types and dispatched to Mintek
in Johannesburg in accordance with Kibo's quality procedures for
secure transport of mineralised material for testing. The test work
carried out by Mintek comprised chemical analyses, excess
preg-robbing leaching, diagnostic leaching and gravity
concentration tests. The results from the key excess preg-robbing
leaching tests are summarised in the table below.
Table 2 Results of Metallurgical Testing of the GHR Ore
Samples
Gold
Head
Grade Cyanide Lime
(grams Consumption Consumption Gold Recovery
per (NaCn in (CaO in (%
Sample No Ore Type tonne) kg/t) kg/t) Dissolution)
------------- -------------- ------- ------------ ------------ ----------------
IMET-01 Oxidised 7.48
------------- -------------- ------- ------------ ------------ ----------------
Direct Cyanidation 0.22 3.76 93.8
----------------------------- ------- ------------ ------------ ----------------
Carbon -in
leach 0.48 3.76 94.3
----------------------------- ------- ------------ ------------ ----------------
IMET-02 Transitional 7.38
------------- -------------- ------- ------------ ------------ ----------------
Direct Cyanidation 0.37 2.26 94.4
----------------------------- ------- ------------ ------------ ----------------
Carbon -in-leach 0.62 2.25 95.4
----------------------------- ------- ------------ ------------ ----------------
Fresh
(minor
IMET-03 sulphide) 5.93
------------- -------------- ------- ------------ ------------ ----------------
Direct Cyanidation 0.63 1.51 89.6
----------------------------- ------- ------------ ------------ ----------------
Carbon -in-leach 0.89 1.51 89.7
----------------------------- ------- ------------ ------------ ----------------
Fresh
(massive
IMET-04 sulphide) 10.95
------------- -------------- ------- ------------ ------------ ----------------
Direct Cyanidation 1.32 15.12 93.5
----------------------------- ------- ------------ ------------ ----------------
Carbon -in-leach 1.53 15.12 93.9
----------------------------- ------- ------------ ------------ ----------------
The high gold recoveries and low reagent (cyanide & lime)
consumptions obtained from these tests indicate that all ore types
at the GHR are amenable to conventional cyanide and carbon-in-leach
extraction. The diagnostic leaching tests also confirmed that all
ore types can be expected to yield high recoveries from
carbon-in-leach processing with recoveries of 94.03%, 94.02%,
89.26% and 94.53% obtained for samples IMET-01 to IMET-04
respectively. The gravity recovery test work (Knelson gravity
concentration tests) showed recoveries in the primary concentrate
of 20.4%, 26%, 16.4% and 32.2% for samples IMET-01 to IMET-04
respectively and these value are sufficiently high to consider a
cost efficient gravity gold recovery circuit prior to cyanide
treatment in the design of an ore processing flow sheet.
This metallurgical testing at the GHR is part of the evaluation
process that the Company has been undertaking to assist with a
decision as to whether to proceed with a development plan for the
GHR. A favourable decision is contingent on the outcome of
negotiations with TREC and development funding being available as
discussed in the next section.
Itetemia & Luhala
The Company believes that in order to undertake further work on
the Itetemia and Luhala projects, it needs to exercise its option
and vest its interest in the properties. Kibo is currently in
discussion with TREC, from whom it holds its interest in Itetemia
and Luhala under a 2007 Option & Royalty Agreement, to
re-negotiate terms of the Agreement to allow the Company to
accelerate the exercise of this option. Exercise of the option is
particularly relevant for the GHR, which Kibo believes can be
developed quickly. Simultaneously with discussions with TREC the
Board is also in negotiations with a financial institution to
provide debt finance to develop the GHR.
Upon completion of these negotiations the Company will be in a
position to make a decision on the development of these properties.
Meanwhile no significant expenditure will be incurred on the
projects. The Company's near term focus will be on the exploration
in advancing the projects at Lake Victoria, Haneti and Morogoro
which it considers to have excellent discovery potential for
significant mineral deposits.
Review by qualified person
Enquiries:
Noel OKeeffe +353 (0)91 Kibo Mining Chief Executive
384562 plc Officer
John Simpson +44 (0)207 Daniel Stewart Nominated
7766550 & Company Adviser
Plc
Andreas Lianos +27 (0)83 River Group Designated
4408365 Advisor
Nick Bealer +44 (0)207 Cornhill Capital Broker (Corporate
7109612 Ltd Broking)
Andrew Frangos +44 (0)207 Cornhill Capital Broker (Corporate
7109610 Ltd Finance)
Matt Beale +44 (0)796 Forthbridge Public Relations
6389196 Consulting
UK
Updates on the Company's activities are regularly posted on its
website www.kibomining.com
This information is provided by RNS
The company news service from the London Stock Exchange
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