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Armadale Capital To Sell Interest In Mpokoto Project For USD562,500

Fri, 12th Jan 2018 10:59

LONDON (Alliance News) - Natural resources-focused investment company Armadale Capital PLC said on Friday it has signed a heads of agreement with Weghsteen Capital Advice SA to sell its interest in the non-core Mpokoto gold project located in the Democratic Republic of Congo.

The 80% interest in Mines d'Or de Kisenge Sarl, owned by Armadale subsidiary Kisenge Mining Pty Ltd, will be sold for USD562,500 and a 1.5% royalty on gold produced.

The company said USD75,000 will be paid on signing the purchase contract, USD187,500 within 12 months of signing, and USD300,000 on the commencement of production.

Weghsteen is acting on behalf of investment vehicle Radismore Ltd, which is funded and committed to start gold production within two years. The heads of agreement is subject to the execution of a formal binding agreement, which is expected in the first quarter of 2018.

The sale is expected to allow Armadale to focus on fast tracking the Mahenge Liandu graphite project with the Mpokoto funds used to support development, and consider other investment opportunities.

"We are pleased to have secured this strategic sales agreement and believe that Radismore and its associates have the necessary funds and skill set to advance Mpokoto into production and unlock the asset’s value potential. Crucially, we will retain an interest in Mpokoto through a royalty without the burden of development and production cost," said Director Nick Johansen.

"This strategic interest in turn means that we can concentrate our resources on developing the Mahenge Liandu Graphite project in Tanzania, which offers near term development opportunity with multiple value accretive milestones expected this year. A drilling programme aimed at significantly increasing the size of the deposit is planned for the second quarter of 2018, whilst the results of a scoping study are due in the first quarter, and a feasibility study is expected to commence thereafter with the objective of reaching a decision to mine in the near term," Johansen added.

Shares in Armadale Capital were up 1.1% at 2.28 pence on Friday.

By Dayo Laniyan;

Copyright 2018 Alliance News Limited. All Rights Reserved.

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