Armadale appoints Xinhai Mineral for Mahenge test work

(Sharecast News) - Armadale Capital reported on Tuesday that engineering, procurement, construction and manufacturing company Xinhai Mineral, part of the Chinese Yantai Xinhai group, had been selected to start metallurgical bulk test work as part of the first phase of the front-end engineering design (FEED) studies for the development of the Mahenge graphite project.
The AIM-traded firm said the objective of the bulk test work was to provide sufficient data to confirm the results underpinning the definitive feasibility study, and confirm the preferred flow sheet prior to the completion of the front-end engineering design to develop an EPCM fixed-price contract.

As part of the process, bulk ore samples were selected from diamond core to produce a blend of 22% oxide ore and 78% fresh ore, with an average grade of between 12% and 14 % TGC, which the company said was representative of the life-of-mine production profile.

The objectives of this test work would include confirming overall rates of graphite recovery for all material types, maximising graphite flake sizes to achieve a minimum of 50% in excess of 150 microns, and achieving a minimum grade of 95% TGC in all size fractions.

Bulk ore samples had been despatched and received by Xinhai Mineral, with test work to start this week.

Xinhai would then use the data in the final design of the processing plant.

"Xinhai are a highly experienced Chinese contracting group and leaders in their field of optimising mineral processing solutions, mine design and build and equipment manufacturing, and we very much look forward to working with them," said chairman Nick Johansen.

"We are also pleased to report that our first bulk ore samples have now been received by Xinhai who are due to begin work upon these imminently with the objective of completing a metallurgical test programme to enable the detailed selection of the processing plant equipment."

Johansen said development efforts were "gathering pace" at Mahange, and in addition to the appointment of Xinhai Mineral, Armadale announced that, following a positive site visit and follow-up consultation, the environmental and social impact assessment was also progressing.

"The assessment is one of the final necessary components in the mining licence process and receipt of a licence will be one of the final and most important de-risking milestones for the project.

"Our financing discussions are also progressing well and we continue to see strong levels of interest as we ensure that we put the best options forward for shareholders at this exciting stage of development for Armadale."

At 1633 GMT, shares in Armadale Capital were down 1.27% at 3.9p.