Last checked at 29 Jan 2024 07:00
Date: 29 January 2024 Blencowe Resources Plc
("Blencowe" or the "Company")
US International Development Finance Corporation provides Letter of Interest for Orom-Cross project financing
DFC lead mandated partner for Orom-Cross project funding
Blencowe Resources Plc (LSE: BRES) is pleased to announce it has received a formal Letter of Interest ("LOI") from the US International Development Finance Corporation ("DFC") in which the DFC has indicated its willingness to participate in debt funding for the Orom-Cross graphite project ("Orom-Cross or the "Project") in Uganda, subject to all necessary due diligence. This comes following recent discussions with DFC project funding division and follows the 2023 agreement with the DFC's technical assistance division, who have already entered into a US$5 million Technical Assistance Grant ("TAG").
To date US$2 million of grant funds have been received from the DFC under the TAG, with the balance expected during the course of 2024 as certain milestones are met. The TAG also provided for the DFC to have the right to be mandated to directly provide (and/or arrange for) financing or investment for the Project on commercial terms.
This LOI is the first step of engagement with the DFC project funding division to advance the project financing process. During the course of 2024 Blencowe will work closely with the DFC to reach a decision to mine subject to the DFS results and other due diligence. Graphite is high on the US Government critical metals and minerals list and their strategy is to open up long term supply chains of graphite. Demand for graphite is accelerating fast and is expected to continue growing into the future due mainly to its non-replaceable role within the lithium-ion battery that stores energy.
The Company is seeking to position Orom-Cross to deliver a 'green' graphite product through a variety of production initiatives, including the use of hydro-electric power for all mining and processing energy requirements. Orom-Cross aims to become one of the leading sustainable mining projects worldwide and this is a very important component of the DFC charter and critical within a rapidly changing landscape where every participant along the EV supply chain is being audited on their sustainability credentials by Original Equipment Manufacturers (OEMs).
Orom-Cross's potential ability to aid in the further development of the Ugandan economy, empowering its population and driving investment and future development has also proved attractive to the DFC.
Cameron Pearce, Executive Chairman commented;
"This Letter of Interest is an important next-step in the process for DFC to consider project financing support to build Orom-Cross into a producing mine. Project funding will be crucial for the Company this year as we work to conclude the DFS and this engagement with the DFC continues to underpin our long-term relationship with the DFC, as lead mandated partner, to assist in this exercise."
Mr Pearce added "Our executive management team will be meeting DFC in the near term to evaluate the project implementation strategy and build on the momentum we have already created together. We believe this is a unique partnership that is significantly de-risking Orom-Cross and we will continue to showcase this exceptional asset as we deliver the DFS results this year.
For further information please contact:
Blencowe Resources Plc Sam Quinn |
www.blencoweresourcesplc.com Tel: +44 (0)1624 681 250 info@blencoweresourcesplc.com
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Investor Relations Sasha Sethi | Tel: +44 (0) 7891 677 441 sasha@flowcomms.com
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Tavira Financial Jonathan Evans | Tel: +44 (0)20 3192 1733 jonathan.evans@tavira.group
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First Equity Limited Jason Robertson | Tel: +44(0)20 7330 1833 jasonrobertson@firstequitylimited.com
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Twitter https://twitter.com/BlencoweRes
LinkedIn https://www.linkedin.com/company/72382491/admin/
Background
Orom-Cross Graphite Project
Orom-Cross is a potential world class graphite project both by size and end-product quality, with a high component of more valuable larger coarse flakes within the deposit.
A 21-year Mining Licence for the project was issued by the Ugandan Government in 2019 following extensive historical work on the deposit. Blencowe completed a successful Pre-Feasibility Study on the Project in July 2022 and is now within the Definitive Feasibility Study phase as it drives towards first production.
Orom-Cross presents as a large, shallow open-pitable deposit, with an initial JORC Indicated & Inferred Mineral Resource of 24.5Mt @ 6.0% TGC (Total Graphite Content). This Resource has been defined from only ~2% of the total tenement area which presents considerable upside potential ahead. Development of the resource is expected to benefit from a low strip ratio and free dig operations together with abundant inexpensive hydro-electric power off the national grid, thereby ensuring low operating costs. With all major infrastructure available at or near to site the capital costs will also be relatively low in comparison to most graphite peers.
