Armadale Capital Plc (‘Armadale’ or ‘the Company’)
Drilling at the Mpokoto Gold Project
Armadale, the AIM quoted investment company focused on natural resources projects in Africa, is pleased to announce it is to commence a 2,500m drilling programme in late July and undertake further analysis of the geological work conducted to-date with a view to increasing the current 678,000oz gold (‘Au’) resource and optimising the already compelling economics of the Mpokoto Gold Project (‘Mpokoto’ or the ‘Project’) in the Katanga Province of the Democratic Republic of Congo. The Project continues to be advanced towards commercial production, which is targeted to commence H1 2016.
2,500m Reverse Circulation drilling programme to commence late July to
- Newly identified Exploration Target areas located along-strike and down dip from known mineralisation – targeting an additional 120,000 to 150,000 oz Au from 2.4Mt to 3.0Mt at a grade of 1.25 to 1.5g/t Au
- Extensions of high grade mineralisation in sheared altered mafic rocks intersected in drill hole MPDD0064, which intercepted 27.9 metres @ 7.8 Au g/t in addition to laterally continuous zones of mineralisation
- Results of further drilling have potential for material enhancements to current pit models and economic fundamentals of the Project which has a current Total Mineral Resource of 678,000oz Au from 14.58 million tonnes (‘Mt’) @ 1.45g/t Au at a cut-off grade of 0.5g/t
- Mpokoto has demonstrated a post-tax net present value of US$55.3 million, US$20m of proposed financing and a defined development strategy to rapidly advance the Project through to low capex, low opex gold production in H1 2016
- Definitive Feasibility Study is currently being finalised following Heads of Agreement with Africa Mining Contracting Services group (‘A-MCS’) with a view to funding, developing, constructing and operating Mpokoto
Peter Marks, Chairman of Armadale, said, “Following the completion of the Heads of Agreement pursuant to which A-MCS proposes to provide US$20m of financing, as well as work with Armadale to develop, construct and operate Mpokoto, we are working hard to finalise the Definitive Feasibility Study (‘DFS’) with A-MCS. We are now also commissioning a further 2,500 drilling programme to explore the exploration targets previously identified by our geological consultants. We believe this has the potential to significantly enhance the current pit models and economic fundamentals of Mpokoto, which continues to develop in line with our expectations of being able to deliver a low capex, low opex commercial gold mining project in the near future.”
Proposed Work Programme
The proposed 2,500m drilling programme will have several objectives including targeting primary and down dip mineralisation beyond the planned present optimised pit limits. In particular, the recent work by CSA has highlighted the possibility of extensions of high grade mineralisation in sheared altered mafic rocks intersected in drill hole MPDD0064, which intercepted 27.9 metres@ 7.8 Au g/t. In addition, the geological work points toward laterally continuous zones of mineralisation. Further drilling will target near-surface "along strike mineralisation" which has the potential to substantially extend planned pits to the north-west.
An Exploration Target of between 2.4Mt to 3.0Mt at a grade of 1.25 to 1.5g/t Au for an additional 120,000 to 150,000 ounces of gold has been identified and the Company hopes to bring these ounces "to book" in the planned drilling programme. The programme is expected to commence during the next few weeks and is expected to take 8-12 weeks to complete, depending on conditions and number of drill rigs available.
The geological review completed in 2014 revealed a strong structural control on the origin and geometry of mineralisation. The implication is that the extension of mineralisation can be extrapolated and targeted with a higher degree of confidence from known mineralised intercepts. This concept is at the base of the proposed drilling work for the expansion of the resource to the north-west. Work in this area should be implemented by way of step out drilling from the current most north-western drilling traverse on nominally 50m spacing, so that the drilling can be adjusted in line with the intersection of mineralisation. Up to 400m strike length of stacked mineralisation lenses can potentially be added to the resource base. Initially the near-surface mineralisation should be targeted to a depth of 75m.
Two target areas of a more conceptual nature but with a potentially significant impact on the economics of the project were interpreted in the vicinity of the “fault” and MPDD0064 drill hole.
The proposed work programme is structured according to the highest immediate effect it potentially can have to the current Mineral Resource base for Mpokoto. The following ranking is proposed:
1. Drilling to support the conversion of all Inferred classified resource to Indicated category
2. Convert Exploration Targets to classified resource status
3. Expand oxide resources where they are not closed off
4. Test with targeted drill holes structural and/or stratigraphic drill holes the depth continuity of primary mineralisation, and
5. Target high-grade primary mineralisation in mafic host rock
6. Work Programme for Area 4 and 3
7. Resource areas 4 and 3 are economically important parts of the Mpokoto deposit area and are both, in terms of upside to potential expansion and with regard to targeting new mineralisation concepts relevant.
Competent Person Statement:
Scientific or technical information in this release has been reviewed by Dr Simon Dorling MAIG, Principal Geologist, at CSA Global Pty Ltd. Dr Dorling is a member of the Australasian Institute of Geoscientists (MAIG) and has over 20 years’ experience, which is relevant to the style of mineralisation under consideration and to the activity which he is undertaking to qualify as a Competent Person, as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (the JORC Code). Dr Simon Dorling consents to the inclusion in this announcement of the information, in the form and context in which it appears.
A copy of the announcement can be found on the Company’s website at www.armadalecapitalplc.com.
Glossary of Technical Terms
|g/t||Grams per tonne|
|Measured||That part of a Mineral Resource for which quantity , grade, densities, shape and physical characteristics are estimated with sufficient confidence to support detailed mine planning and final evaluation of the economic viability of the deposit. A Measured classification is the highest classification level for Mineral Resource estimates.|
|Indicated||That part of a Mineral Resource for which quantity , grade, densities, shape and physical characteristics are estimated with sufficient confidence to support mine planning and the evaluation of the economic viability of the deposit. An Indicated classification is of a lower confidence level than a Measured classification.|
|Inferred||That part of a Mineral Resource for which quantity and grade are estimated on the basis of limited geological evidence and sampling. An Inferred classification is of a lower confidence level than an Indicated classification.|
|Oxide||Shallow depth of rock where the original mineralogy of the rock is extensively broken down by the action of external agencies such as water percolation and chemical leaching.|
Justin Lewis, Director +61 439 162369
Charles Zorab +44 207 233 1462
Nomad and broker: finnCap Limited
Christopher Raggett/ Simon Hicks +44 207 220 0500
Joint Broker: VSA Capital Limited +44 203 005 5000
Bhavesh Patel/Richard Buckle
Press relations: St Brides Partners Limited
Charlotte Heap / Hugo de Salis +44 207 236 1177
More information can be found on the website www.armadalecapitalplc.com
Armadale Capital Plc is focused on investing in and developing a portfolio of investments, targeting the natural resources sector 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 potential businesses where it can take an active role in their advancement.
Armadale owns 80% of the Mpokoto Gold Project in the Democratic Republic of Congo. Armadale is focused on proving up the resource potential of Mpokoto with a view to commencing commercial gold production.
Armadale also holds approximately a 30% interest in Mine Restoration Investments Ltd, a South African listed company, which aims to develop profitable operations within the South African mining industry through its coal processing operation in KwaZulu Natal.
In addition, Armadale has a small portfolio of listed investments which are focused on gold and copper production and exploration. The Directors continue to maintain an active acquisition strategy and will review investment opportunities that they believe have the potential to be accretive in terms of shareholder value.