Mahenge Liandu Graphite Project DFS Update

Mahenge Liandu Graphite Project DFS Update

Armadale Capital Plc

Armadale Capital Plc / Index: AIM / Epic: ACP / Sector: Investment Company

26 April 2019

Armadale Capital Plc (‘Armadale’ or ‘the Company’)

Mahenge Liandu Graphite Project DFS Update

Armadale Capital plc (LON: ACP) the AIM quoted investment company focused on natural resource projects in Africa, is pleased to provide a progress update in respect of its Tanzanian Mahenge Liandu Graphite Project (“Mahenge Liandu” or the “Project”) Definitive Feasibility Study (“DFS”), further to the announcement dated 16 April 2019 which can be viewed at https://bit.ly/2GFwWdH.

Highlights

• Received final Environmental and Social Impact Assessment report (“the ESIA Report”) from external consultants – favourable findings
• Completed decommission implementation plan considering options on how to utilise the site after mining is completed
• Received Relocation Action Plan (“RAP”), principally to engage with the local community
• On schedule to submit final ESIA Report and RAP to the National Environment Management Council of Tanzania (“NEMC”) by the end of April 2019

Nick Johansen, Director of Armadale said: “We are very pleased with the speed at which the DFS is advancing as we look to advance the world-class Mahenge Liandu Graphite Project in south-east Tanzania and establish a significant high-grade graphite mine. Both the ESIA Report and RAP are integral to this process, enabling us to apply for a mining licence, so we are delighted with the findings that appear favourable. We are now completing our in-house work on these documents and look forward to submitting both to the NEMC shortly. Other multiple workstreams are ongoing regarding the DFS and commercial discussions related to the Project; we anticipate updating the market with further progress in the near term.”

Environmental and Social Impact Assessment Report

As part of a DFS at the Mahenge Liandu Graphite Project, Armadale has received a final ESIA Report from its external consultants, which concludes that the potential impacts associated with the proposed graphite mine and processing site are of a nature and extent that can be reduced, limited and eliminated by the application of appropriate mitigation measures.

The ESIA Report was compiled after consultations with relevant heads and technical staff of different departments and agencies in zonal authorities in Morogoro Town (Regional Commissioner Office), Ifakara Town (Zones Mines Office and Rufiji Basin Water Board), District authorities in Ulanga Town (District Commissioner Office and District Executive Director Office), Resident Mines Office at Morogoro Town and surrounding village government leaders and group representatives.

The ESIA Report includes baseline environmental data, which was collected in 2018 and examines environmental mitigation options that can reduce the impact on the environment caused by mining at the site.

A decommission implementation plan considered options on how to utilise the site after mining is completed and how to reduce the long-term impact of the mining operation after the mine closes.

Relocation Action Plan

Armadale has received the RAP, which covers the area of the proposed mining licence of 9.0km² from its Tanzanian based consultants. The area affected by the Project has limited areas of development and a low population density and the Company anticipates a low compensation cost relative to the overall capital requirement of the Project. The objective of the RAP is:

1. to engage the community and give them an understanding of the impacts of the development;

2. to identify the property and assets within the proposed licence;

3. to value the property and assets including compensation costs, disturbance allowances and other assistance values;

4. to involve the community in developing a plan for physical relocation; and

5. to provide measures to ensure the livelihoods of the people in project area are maintained at the levels before the project inception.

Document Submissions

The Company is finalising its comments to the ESIA Report and RAP and expects to submit both documents to the NEMC by the end of April 2019 as expected.

The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.

**ENDS**

Enquiries:
Armadale Capital Plc Paul Johnson, Non-Executive Director (UK) Tim Jones, Company Secretary			[phone]
Nomad and broker: FinnCap Ltd Christopher Raggett / Max Bullen-Smith			[phone]
Joint Broker: SI Capital Ltd Nick Emerson			[phone]
Press Relations: St Brides Partners Ltd Isabel de Salis / Juliet Earl			[phone]

Notes

Armadale Capital Plc is focused on investing in and developing a portfolio of investments, targeting the natural resources and/or infrastructure sectors in Africa. The Company, led by a team with operational experience and a strong track record in Africa, has a strategy of identifying high growth businesses where it can take an active role in their advancement.

The Company owns the Mahenge Liandu graphite project in south-east Tanzania, which is now its main focus. The Project is located in a highly prospective region with a high-grade JORC compliant Indicated and inferred mineral resource estimate of 51.1Mt @ 9.3% TGC, making it one of the largest high-grade resources in Tanzania, and work to date has demonstrated Mahenge Liandu’s potential as a commercially viable deposit with significant tonnage, high-grade coarse flake and near surface mineralisation (implying a low strip ratio) contained within one contiguous ore body.

Other assets Armadale has an interest in, include the Mpokoto Gold project in the Democratic Republic of Congo and a portfolio of quoted investments.

More information can be found on the website www.armadalecapitalplc.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20190425005637/en/