Bougouni Project Development & Exploration Update

RNS Number : 7658M

Kodal Minerals PLC

18 September 2019

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR")

Kodal Minerals Plc / Index: AIM / Epic: KOD / Sector: Mining

18 September 2019

Kodal Minerals plc ('Kodal Minerals' or the 'Company')

Project Development and Exploration Update

Kodal Minerals, the mineral exploration and development company focused on its Bougouni Lithium Project in southern Mali (the 'Project' or the 'Bougouni Project'), is pleased to provide this update on recent activities.

Highlights:

Bougouni Project Development

·    Site visit to the San Pedro Port (the 'Port'), Côte d'Ivoire completed;

o Engagement with the Port authorities regarding the potential export of spodumene concentrate; full support and availability confirmed.

·    Receipt of indicative pricing on transport of spodumene concentrate following discussions with an experienced shipping and logistic service company with relevant experience of bulk commodity transport throughout West Africa.

·    Continued improvements in the open pit ('Open Pit') optimisation studies following discussions with experienced Malian mining contractors confirming competitive mining costs for Bougouni Open Pit operations.

·    Bulk sample loaded onto a ship and departed Dakar; 

o Sample material is expected to arrive in the Shandong province, China, in mid-October.

·    The bulk sample size will be processed through an existing dense media separation ('DMS') facility, providing beneficial information in support of processing and recoveries at an operational scale.

Exploration

·    Final assay results received for the exploration drilling completed prior to the wet season;

o Broad zones of mineralisation confirmed at the Marigo prospect and low-level mineralisation from the reconnaissance at the Mafele concession. 

·    Results include:

o 42m at 0.22% Li₂O from 54m in drill hole MDRC131, Marigo prospect;

o 17m at 0.35% Li₂O from 58m and 31m at 0.23% Li₂O from 91m in drill hole MDRC132, Marigo prospect.

·    Reconnaissance surface geochemical sampling completed at the Dabakala and Korhogo concessions in Côte d'Ivoire. 

·    Gold assay results confirm a coherent gold anomaly at Dabakala extending for over 10km in strike with results up to 97ppb gold.

·    Gold assay results at the Korhogo prospect confirm anomalous zones extending for 2km with results up to 83ppb gold.

Bernard Aylward, CEO of Kodal Minerals, commented: "We are continuing to de-risk our flagship asset, the Bougouni Lithium Project, through the completion of our engineering studies.  This important technical work represents significant components of our upcoming Feasibility Study and we are using the most experienced consultants to ensure we achieve the best result.  The finalisation of the metallurgical test work programme, the review of the proposed transport, port facilities and mining contractors all feed into our mining optimisation studies and scheduling that will complete the feasibility work.

"Our exploration programmes continue to highlight the potential for further discoveries at both the Bougouni Project and Bougouni West, while our reconnaissance geochemical sampling at our gold projects in Côte d'Ivoire highlights additional value accretive opportunities for the Company and our shareholders.

"As previously announced, our Environmental and Social Impact assessment ('ESIA') has been lodged with the Mali Department of Environment and is moving through the process of review and approval, on which we look forward to updating our shareholders.  Following this process, we anticipate finalising the various components of our Mining Licence application and lodging it with the Malian authorities for approval.  This is a transitional time for Kodal and we would like to thank our operational and technical teams for their efficiency in undertaking the various studies we are undergoing as well as our shareholders for their ongoing support.  I look forward to updating the market in due course."

Further Information

Mine Engineering

Mine engineering for the Feasibility Study is well advanced and Open Pit optimisations are nearing completion.  Optimisations indicate that processing of Ngoualana's material through the DMS-only plant supports a mining plan focussed on extraction of Ngoualana ores for an initial period of 2-3 years.  This option could provide the Company with a low-cost start-up operation that will be supplemented with the deferred installation of a flotation plant thereafter.  This is continuing to be reviewed in studies and the Company is consistently looking at the best option for the development of the Project.

Detailed mine design and scheduling will commence following completion of the Open Pit optimisation review, and it is estimated that an initial mine life based on defined in-pit JORC resources will extend over an 8-10 year period, with average concentrate production in the order of 150,000-175,000 tonnes per annum of saleable concentrate product.

Study phase engineering design work is complete for mining geotechnical and non-process infrastructure, including office, camp, access roads, water and power facilities.  With the recent completion of metallurgical test work, the mineral process flowsheet definition has been finalised and now allows the Company to move to finalising the plant engineering and supporting process infrastructure designs for the study phase.

Bulk Sample and Metallurgy

The bulk sample has been dispatched from the Dakar port and is expected to arrive in the Shandong province, China, in mid-October.  Following arrival at port in Shandong, the material will be transported to the Ruifu Chemical lithium concentrator plant.  This plant comprises a 2Mtpa processing plant incorporating a DMS circuit and floatation circuit.  The proposed programme will see the bulk sample treated through the plant and all stages of processing will be monitored.  Kodal will have its Project Manager and engineering process consultants on site to oversee the work.  The results of this operational scale processing run will provide valuable plant scale recovery data to both the off-take partner and Kodal, the importance of which is often overlooked during the feasibility phase.

Product Transport Study

The Company's management team visited the preferred port facility for the load-out of final lithium concentrate, the San-Pedro Port in Côte d'Ivoire. A meeting was held with key representatives from the San Pedro Port Authority ('SPAP') who escorted the Company's management team on a tour of the facilities.

The visit included an inspection of the Port's container handling facility, and importantly their bulk materials handling establishments.  SPAP is currently servicing exports of many bulk commodities, including iron ore and manganese concentrate, most notably, the iron ore export tonnes out of San Pedro are more than double the Company's future demands.  Very positive feedback was received from SPAP personnel, expressing their interest to assist with the Project, and providing the confidence that the San Pedro Port has the knowledge and capacity to handle bulk material exports for the Bougouni Project.

The Company has also completed a survey of the proposed transport route from Bougouni to the San Pedro Port to confirm suitability for bulk commodity transport.  This information has been supplied to the local logistic group who have confirmed suitability of the preferred route.

Exploration

Bougouni Lithium Exploration

Final assay results have been received for the exploration drilling completed at the Marigo Prospect, Bougouni Lithium Project, and at the Mafele Concession, Bougouni West Project.

Marigo Prospect

The Marigo Prospect ('Marigo' or the 'Prospect') is defined by geological mapping that identified outcropping pegmatite veins with abundant coarse spodumene minerals.  The Prospect is located mid-way between the Boumou and Sogola-Baoule prospects and the pegmatite veins are interpreted as striking in an east-west direction similar to the other prospects in the region.

This first campaign drilling programme consisted of 4 drill holes for 474m, with all holes intersecting pegmatite.  The assay results confirm that the pegmatites are mineralised, however in this location the lithium mineralisation is low tenor.  The review of the drill hole location and drill chips indicate that the degree of weathering and proximity to a creek area may have led to a dilution of lithium in the weathering process.  The wide zones of shallow mineralisation are very encouraging, and the Company is focussing on the strike extensions of the Prospect in areas where there is less weathering and potential impact of dilutive activity.  This weathering effect has previously been noted at the Ngoualana and Sogola-Baoule prospects where the zones closest to active drainages and deeper weathering have demonstrated reduced lithium grades, similar to the Finniss project in Darwin of Core Lithium and Greenbushes of Talison Lithium in Australia.

Mineralised intersections for the reverse circulation ('RC') drilling calculated using a 0.2% Li₂O lower cut-off, maximum 2m internal continuous dilution are tabled below:

Hole Id	Northing	Easting	Hole Depth m	From m	To m	Thickness m		Li2O %
MDRC129	653960	1254800	103	28	33	5	0.23
MDRC130	653795	1254785	127	40	50	10	0.21
MDRC130				70	79	9	0.20
MDRC130				99	104	5	0.20
MDRC131	653700	1254800	120	54	96	42	0.22
MDRC132	653700	1254740	124	58	75	17	0.35
MDRC132				91	122	31	0.23

Notes:  Drill holes are RC drill holes. Drill holes prefixed MDRC* are from the Marigo prospect located within the Madina concession.  Drill holes have been sampled on a 1.0 basis with samples collected via a riffle split system. Drill hole collars are surveyed using a differential GPS with sub 1-metre accuracy, coordinate system WGS84 - Zone 29N, and all holes are survey down-hole for dip and azimuth on approximately 30m intervals. All drill holes are geologically logged, and sampling for analysis in based on geological boundaries.  Samples analysed by ALS Global. Assay results are reported as Li% and converted to Li₂O% by a factor of 2.153. 

Mafele Concession

The Mafele Concession is located approximately 25km to the west of the Bougouni Lithium Project and was acquired by Kodal in February 2019.  The maiden drilling programme was a reconnaissance drill test of several geological and geophysical targets. 

All drill holes intersected lithium mineralised pegmatite bodies, however, the lithium grade was generally low.  Further exploration activity will focus on targeting the pegmatite ones in areas of less weathering and attempt to define zones of thicker pegmatite veins.

Côte d'Ivoire Gold Exploration

Kodal maintains a suite of prospective gold exploration gold projects in Mali and Côte d'Ivoire.  During the wet season, the Company has taken the opportunity to send a field crew to Côte d'Ivoire to undertake a programme for regional geochemical sampling at the 100% owned Dabakala and Korhogo projects in north-central Côte d'Ivoire.

The geochemical sampling consisted of conventional surface samples and termite mound sampling (where available) on a nominal 2km x 200m sample spacing at Dabakala (225 samples), infilling an area of previously defined gold anomalism, and a nominal 1km x 200m spacing at Korhogo (190 samples) targeting infill at several gold anomalous zones and structural targets within the Korhogo project.

The Dabakala project is a single concession in central Côte d'Ivoire where previous work completed by the Company highlighted an extensive surface geochemical anomaly and field geological mapping indicated the association of sheared and altered geology associated with the anomaly.  This is a large surface anomaly, extending for over 10km of strike and up to 800m in width and exploration is at an early stage.  The follow-up work completed by the company infilled the anomaly to a nominal 1km x 200m spacing over the key anomaly (and notes that still is very wide and reconnaissance level) and assay results received confirm the anomaly with results up to 97ppb returned and confirming the extent of the anomaly.  Further work is required to define this prospect prior to initial drill testing.

The Korhogo project is a single concession is north central Côte d'Ivoire and several phases of geochemical sampling has defined surface geochemical anomalies.  The recent sampling by the company has confirmed gold anomalous zones extending for over 2kms in strike and up to 600m in width.  Further exploration is required to review these targets and prioritise further work.

The Company is continuing to review opportunities for the prospective suite of gold projects.

**ENDS**

For further information, please visit www.kodalminerals.com or contact the following:

Kodal Minerals plc Bernard Aylward, CEO	Tel: [phone]
Allenby Capital Limited, Nominated Adviser Jeremy Porter/Nick Harriss	Tel: [phone]
SP Angel Corporate Finance LLP, Financial Adviser & Broker John Mackay	Tel: [phone]
St Brides Partners Ltd, Financial PR Catherine Leftley/Cosima Akerman	Tel: [phone]

About Kodal Minerals

Kodal Minerals' primary focus is on the rapid advancement towards production of its flagship Bougouni Lithium Project in Southern Mali.  The JORC Resource Estimate places the Bougouni Project in the top 15 hard rock lithium projects globally and was calculated using only three of the eight currently recognised prospects demonstrating the significant exploration upside potential remaining across the 450km² project area.  The Mineral Resource estimate for the Ngoualana, Sogola-Baoule and Boumou prospects are tabulated below.  These mineral resources are reported in accordance with the JORC Code:

Prospect	Indicated			Inferred			Total
	Tonnes (Mt)	Li2O% Grade	Contained Li2O  (kt)	Tonnes (Mt)	Li2O% Grade	Contained Li2O  (kt)	Tonnes (Mt)	Li2O% Grade	Contained Li2O  (kt)
Sogola_Baoule	8.4	1.09	91.9	3.8	1.13	42.8	12.2	1.10	134.8
Ngoualana	3.1	1.25	39.2	2.0	1.12	22.1	5.1	1.20	61.3
Boumou				4.0	1.02	40.4	4.0	1.02	40.4
TOTAL	11.6	1.13	131.2	9.7	1.08	105.3	21.3	1.11	236.5

Notes:  Mineral resources are reported using a 0.5%Li₂O cut-off.  Figures may not sum due to rounding.  The contained metal is determined by the estimated tonnage and grade.

The Bougouni Project and recently acquired 200km² Bougouni West project are located in an emerging lithium province that is already attracting the attention of investors and off-take partners interested in securing a long-term supply of lithium.  With the support of its strategic investor and off-take partner Suay Chin International Pte, a Singapore-based lithium and chemical trader, Kodal Minerals is well positioned to continue its ambitious development programme at Bougouni.

Further to this, Kodal Minerals is the manager of additional lithium and gold projects that are undergoing low cost exploration programmes in addition to JV funded gold properties in Côte d'Ivoire that offer potentially significant long-term value.

 

END

 

 

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