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Armadale Capital Plc (ACP)

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Thursday 03 May, 2018

Armadale Capital Plc

Commencement of Feasibility Study at Mahenge Liandu

Commencement of Feasibility Study at Mahenge Liandu

Armadale Capital Plc

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

3 May 2018

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

Commencement of Feasibility Study at Mahenge Liandu

Armadale, the AIM quoted investment company focused on natural resource projects in Africa, is pleased to announce the commencement of a feasibility study (the ‘Feasibility Study’) on the Mahenge Liandu Graphite Project in Tanzania (‘Mahenge Liandu’ or the ‘Project’) ahead of an anticipated decision to mine in early 2019. The Feasibility Study will be undertaken by BatteryLimits, which recently completed the Scoping Study at Mahenge Liandu.


  • Feasibility Study commenced following successful completion of Scoping Study in March 2018 which delivered a pre-tax IRR of 122%, NPV of US$349m with a low development capex of US$35m and low operating costs of US$408/t.
  • The Feasibility Study is designed to confirm the commercial viability of the deposit, which is one of the highest grade large flake projects in the world with a JORC Resource of 51.1Mt at 9.3% TGC.
  • Feasibility Study parameters will be centred on a 400,000tpa over a 32 year mine life.
  • Product quality test work and marketing of the high purity high quality graphite concentrates be a focus of the Feasibility Study.
  • A diamond drilling programme will commence as soon as weather conditions permit which will be used for more detailed metallurgical work programme and for geotechnical sampling.
  • Permitting activities are continuing with the recently announced formation of a Tanzanian Mining commission expected to improve the permitting process.
  • Fully funded to completion of the Feasibility Study after the recently completed £963,500 capital raising.
  • Expected completion of Feasibility Study in Q4 2018 allowing a decision to mine early in 2019.

Nick Johansen, Director of Armadale said: “We are moving up through the gears of development at Mahenge Liandu, accelerated by the highly positive Scoping Study results delivered in March 2018 which highlighted the Project’s significant potential value, most notably through the delivery of an NPV of US$US349m and IRR of 122%. The commencement of a Feasibility Study, launched in conjunction with the relevant permitting activities, ensures that the Armadale team should be in a position to make a decision to mine in early 2019, looking to translate this significant potential value into real returns for shareholders.

“We look forward to updating investors on the development of the Feasibility Study, together with our additional operational and marketing activities over the coming months.”

Commencement of Feasibility Study

The feasibility study will be based on a throughput of 400,000tpa over a 32 year mine life. The feasibility study will involve a range of activities;

  • A diamond drilling programme to obtain samples for metallurgical test work and marketing
  • A geotechnical drilling programme to define the final pit wall design
  • Product marketing towards the goal of achieving binding offtake agreements
  • The construction of water production bores to determine the flow rates and ground water conditions in the Project area
  • Environmental and social studies covering the Project area and completion of a Relocation Action plan (RAP) for the people who may be impacted through the development of the Project
  • Progressing towards application of mining permits
  • Calculation of Proved and Probable Reserves
  • Finalisation of production flowsheets and final plant design parameters

Product Quality and Marketing

The Mahenge Liandu deposit has been shown to contain excellent flake size distribution and exceptional graphite purity. The Feasibility Study will focus on defining graphite product quality with a wide diameter diamond core drilling programme aimed at generating samples for marketing. A range of potential markets will be examined with potential customers in the lithium ion battery, expandable graphite and traditional graphite markets. The high purity of the graphite concentrates is expected to improve the marketability especially in the battery market segment.

Table 2 Flake Size Distribution and Purity

Flake Size   Microns   4088-09

Mass (%)

  TGC Grade (%)
Super Jumbo > 500 3.67 97.9
Jumbo 300 – 500 20.8 97.9
Large 180 – 300 23.6 97.9
Medium 150 – 180 18.4 98.1
Small -150+75 21.8 98.3
Fine < 75 11.8 97.1

Environmental Studies and Permitting

Environmental and social baseline studies have now commenced with the project registered with National Environmental Management Council, NEMC. The study is being undertaken by experienced Tanzanian consultancy Enviromine. The Project is expected to have a small area of impact and is located in an area with a low population density.

Development Drilling Programme

Discussions with a drilling company to conduct the metallurgical, geotechnical and water bores are nearing completion with commencement of the met drilling and Geotech drilling expected to occur this quarter.

Flowsheet Design and Capital Cost Estimate

Final flowsheet and plant design will be managed by BatteryLimits. The flow sheet will utilise the results of a flotation test work. Results to date have indicated the deposit is highly amenable to upgrade to exceptionally high purity using a conventional flotation process.

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 +44 20 7236 1177

Tim Jones, Company Secretary

Nomad and broker: finnCap Ltd

+44 20 7220 0500

Christopher Raggett / Simon Hicks

Joint Broker: SVS Securities +44 20 3700 0093

Tom Curran / Ben Tadd

Press Relations: St Brides Partners Ltd +44 20 7236 1177

Susie Geliher / Charlotte Page



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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