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Armadale Capital Plc (ACP)

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Tuesday 16 July, 2019

Armadale Capital Plc

Positive Metallurgical Test-Work Results

Positive Metallurgical Test-Work Results

Armadale Capital Plc


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

Positive Metallurgical Test-Work Results

Armadale Capital plc (LON: ACP), the AIM quoted investment group focused on natural resource projects in Africa, is delighted to announce further confirmation that commercialisation plans for the Mahenge Liandu Graphite Project in Tanzania continue to advance. Notably, metallurgical test-work is progressing well with initial test-work in line with expectations.


  • Initial metallurgical test-work results from flotation stage demonstrated solid graphite recovery up to 95% Total Graphitic Content (TGC), consistent with expectations
  • Incremental test-work undertaken to enhance quality of final graphite concentrate product progressing well with a targeted premium purity levels expected in the 95-97% range – potentially facilitating premium pricing being factored into future off-take agreements
  • Review of legacy rainfall data indicates Project will have ample surface water to construct and then operate the mine and processing plant, materially reducing requirement for utilising costly ground water
  • New developments likely to have a positive impact on the Project’s economics, which will be reflected in the DFS when published
  • Stakeholder engagement with the local community remains a top priority and continues positively

Nick Johansen Director of Armadale said: “With many moving parts critical to developing a seamless value chain for the Mahenge Liandu Project, it is pleasing to receive metallurgical test-work that is progressing to plan and with results in line with expectations. This will augur favourably as we move more proactively to secure binding off-take commitments and project level financing from our Chinese partners.

“It is also a positive outcome that surface water will be the primary water source as, along with the potential to price our final graphite product at a premium, this will also deliver a positive uplift on the Project’s overall economics.

“Moving forward, our engagement with the local community couldn’t be stronger and we are delighted to have their support, especially as the Board moves to aggressively ramp up our efforts to transform from explorer to emerging graphite producer.”


Metallurgical test-work

Material from seven diamond drill-holes in the pit area were used to generate several metallurgical composites comprising: one master oxide; one master fresh ore; and seven variability mixtures. Test-work on the master composites indicate: the oxide ore is considered soft with low abrasion; and, fresh ore soft to moderate hardness with low to moderate abrasion that can be easily processed.

The ore was crushed up to 1mm then put through an initial rougher flotation circuit. This achieved up to 95% initial recovery levels, which is in line with expectations, with similar performances for oxide and fresh ore.

Cleaner test-work has now commenced to increase purity of the final graphite concentrate to marketable levels >95% TGC. Initial concentrate cleaning results are favourable with optimisation work continuing to achieve premium purity levels typical for graphite deposits in the Mahenge region.

The purity levels targeted to be achieved by the end of the test work programme are between 95-97% TGC at this stage of metallurgical test-work, which is at the higher end of graphite projects globally.

Water management

A review of local rainfall data indicated that the Project will have ample surface water to operate the mining operation and the processing plant. As such, the mine plan will incorporate the use of surface and recycled water used in processing to minimise the drawdown of ground water resources as well as reduce run-off from site into surrounding communities.

In addition, test-work on water bore samples collected from the Project area returned positive results that confirmed it suitable for use in the process plant, mine construction and operation phases. It also highlighted that to mitigate against drought conditions, water test-work demonstrated ground water is suitable substitute if required. Accordingly, the mine plan is being reoriented to focus on primarily using available surface water and recycling strategies, which are more economic and reduce the need for a bore field to be constructed to supply water.

Community liaison

Armadale’s local management held an open meeting with the Liandu Village Council Committee, District Commissioner and District Executive Director in June 2019 to review engagement to date and focus on areas where cooperation could be enhanced.

All stakeholders believe the relationship has delivered considerable value to the community over the past two years. Moving forward, the village council is keen to leverage the successful relationship with Armadale to encourage further investment and development in the local community by other local and international groups.


Armadale’s wholly-owned Mahenge Liandu graphite project in Tanzania is in a highly prospective region, with a high-grade JORC compliant indicated and inferred mineral resource estimate announced February 2018 – 51.1Mt at 9.3% TGC. This includes 38.7Mt Indicted at 9.3% and 12.4Mt at 9.1% TGC, making it one of the largest high-grade resources in Tanzania.

The work to date has demonstrated the Project’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.

Currently, Armadale is completing a Definitive Feasibility Study (DFS) based on the results of a Scoping Study that was completed in March 2018. Highlights from the study include:

  • Producing an average of 49,000tpa of high-quality graphite products for a 32-year mine life
  • The near surface nature of the deposit produced a low 1:1 strip ratio for the life of the mine
  • The Project has a low operating cost of US$408/t, based on an average 12.5% TGC life of mine grade
  • The Project has a pre-tax IRR of 122% and NPV of US$349m, with a low development capex of US$35m
  • The maximum draw-down during the construction of the Project is US$34.9m and the after-tax payback period is 1.2 years

There remains significant scope to further improve returns, with staged expansions as the current mine plan is based on circa 25% of the total resource.

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




Armadale Capital Plc

Paul Johnson, Non-Executive Director (UK)

Tim Jones, Company Secretary

+44 (0) 20 7236 1177

Nomad and broker: FinnCap Ltd

Christopher Raggett / Max Bullen-Smith

+44 (0) 20 7220 0500

Joint Broker: SI Capital Ltd

Nick Emerson

+44 (0) 1483 413500

Press Relations: St Brides Partners Ltd

Isabel de Salis / Juliet Earl

+44 (0) 20 7236 1177



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

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