(Alliance News) - Armadale Capital PLC on Tuesday announced a "meaningful upgrade" to the mineral resource estimate for its Mahenge Liandu graphite project in Tanzania.
The results of a recent infill drilling campaign have seen the resource estimate increase to 59.5 million tonnes at 9.8% total graphitic content. Notably, the firm said, the upgrade was largely underpinned by two coherent high-grade 3.1 million tonnes at 15% graphitic content near surface zones, including 1.2 million tonnes at 17.3%.
"The implication of the resource model is that more high-grade near surface graphite can potentially be mined at a lower extraction cost in the early years, to bolster potential cashflow and enhance the project's overall valuation," the company explained.
The results are expected to have a positive outcome on the definitive feasibility study currently being prepared.
"This latest upgrade is extremely welcome news and there are a number of clear positives to take from it. Firstly, we now have materially higher confidence in the mineral resource estimate with 11.5Mt @ 10.5% in the Measured category; and secondly it has demonstrated the potential to mine higher volumes of graphite in the early years at a higher Ebitda margin to enhance the Project's overall upside," said Armadale Director Nick Johansen.
Shares in Armadale were up 0.5% at 2.11 pence in London on Tuesday.
By Lucy Heming; lucyheming@alliancenews.com
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Armadale Capital (ACP)