Mpokoto Gold Project – Update on exploration and expanded resource definition


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

25 November 2015

Armadale Capital Plc

(‘Armadale’ or the ‘Company’)

Mpokoto Gold Project – Update on exploration and expanded resource definition

Armadale, the AIM-quoted investment company focused on natural resource projects in Africa, is pleased to provide an update on the ongoing development and expansion of its Mpokoto Gold Project (‘Mpokoto’ or the ‘Project’) in the Democratic Republic of the Congo (‘DRC’), with a current mineral resource of 678,000 oz and which remains on track to commence production in H1 2016.


  • Extensive soil sampling programme undertaken over the last three months, which has identified a number of new gold anomalies indicating possible strike extensions to the known gold mineralisation
  • Ongoing exploration programme to explore a number of drill ready targets that have been identified
  • Intention to form a strategic alliance with local drilling company Alpha Drilling (“Alpha”), which would supply two diamond drill rigs for exploration over Armadale’s extensive Kisenge licence area
  • Further drilling planned for 2016 to test oxidised portion of Mpokoto ore body as well as deeper exploration around hole 64, which encountered significantly higher grades in a mafic host rock
  • Additional metallurgical testwork underway to further optimise the identified two-phased processing routes for gold recovery (as announced on 3 August 2015) – results expected shortly
  • Metallurgical results to support finalisation of Definitive Feasibility Study (‘DFS’) – targeted by year end 2015
  • Targeting approximately 25,000oz Au per annum over initial nine year life of mine with projected cash costs of US$647/oz
  • Current Net Present Valuation of US$32.3m based on a forecast gold price of US$1,100/oz
  • Continued constructive engagement with A-MCS with aim to update financing agreements this year

Andrew Tunks, Director of Armadale, commented, “Mpokoto continues to advance towards commercial production. We are pleased to be able to report positive results from the extensive soil sampling programme undertaken over the last three months to further expand and advance the Project. The programme has identified a number of further drill targets to add to existing targets that have the potential to significantly grow the oxide resource at Mpokoto. We are very pleased to announce the intention to enter into a strategic alliance with Alpha. This deal will result in us having permanent access to two drill rigs at very competitive rates, which importantly can be operated throughout the wet season. Combined, these initiatives allow the Company to target an expanded resource base of more than 1 million ounces of gold.

“Furthermore, the additional metallurgical testwork which we commenced in September 2015 is nearing its conclusion. We believe the results from this will favourably impact the projected economics of the Project, which are already extremely competitive with estimated cash costs of US$647/oz and an NPV of US$32.3m. Once the results for this testwork have been received, we will work to finalise the DFS before the end of the year, alongside our continued constructive engagement with A-MCS to conclude the financing agreement, which will bring with it up to US$20 million of financing. We look forward to updating shareholders on these milestones in the coming weeks and months ahead.”

Further Information

The strategic alliance between Armadale and Alpha, which is a Botswana based drilling organisation with operations in the DRC and extensive experience in sub-Saharan Africa, is intended to allow the supply of two diamond drill rigs on a permanent basis for the exploration of Armadale’s Mpokoto Gold Project and the wider Kisenge licence area, where a number of new drill ready targets have been identified.

It is proposed that the rigs will be available on a cost plus basis and the alliance will enable the Company to explore the more than 900 sq kilometres of the Mpokoto Gold Project and its Kisenge licences during both the wet and the dry season. Alpha have sourced two new drilling rigs in the DRC and will have a large supply of the necessary consumables, such as drill bits, rods and lubricants, in country. Mobilisation to site is expected in early 2016.

The initial focus of the alliance will be the drilling programme designed to test extensions to the oxidised (weathered) portions of the Mpokoto ore body where new sampling has identified possible extensions of the mineralisation. In addition, several deeper holes will test the high-grade mineralisation previously identified around hole 64. Recent drilling of a water bore for hydrological investigations associated with the current feasibility study encountered substantial free gold identified by hand panning of the drill spoil in this area, assays for this hole are pending.

Over the last 3 months the Company has conducted an extensive soil sampling programme in the vicinity of the Mpokoto Gold Project. The soil sampling programme consisted of the taking of several hundred samples from soils that were then hand panned by the Company’s exploration staff with free gold particles in the samples being counted. This method, which is a very economic exploration method, was originally used to identify the Mpokoto Project itself, which now has indicated and inferred JORC resource of 678,000 ounces.

A number of new gold anomalies and extensions to the known gold mineralisation were identified by the programme. These new targets will be investigated in the drilling programme to be conducted by Alpha. The near term objective is to expand its resource base to more than 1 million ounces and to define an initial mineral reserve prior to the commencement of construction of a 750,000 tonne per annum plant as outlined in the Expanded Scoping Study.

Armadale continues to work closely with Africa Mining Contracting Services (‘A-MCS’) to fund, develop, construct and operate Mpokoto, and the Company expects to make further updates in this regard before the end of December 2015.



For further information please visit or contact:

Armadale Capital plc

Andrew Tunks, Director +44 207 233 1462

Charles Zorab, Investor Relations

Nomad and broker: finnCap Ltd

Christopher Raggett/Simon Hicks +44 (0) 207 220 0500

Joint Broker: Beaufort Securities Ltd

Jon Belliss +44 (0) 20 7382 8300

Joint Broker: VSA Capital Ltd

Andrew Raca/Richard Buckle +44 (0) 203 005 5000

Press relations: St Brides Partners Ltd

Hugo de Salis/Charlotte Heap +44 (0) 207 236 1177

Competent Person Statement:

Scientific or technical information in this release has been reviewed by Dr Andrew Tunks, a director of the Company.. Dr Tunks, who holds a BSc (Hons) from Monash University and a PhD in geology from the University of Tasmania and is a member of the Australasian Institute of Geoscientists (MAIG). Dr Tunks has sufficient 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 Tunks consents to the inclusion in this announcement of the information, in the form and context in which it appears.


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 businesses where it can take an active role in their advancement. Armadale’s primary project is the development of the Mpokoto Gold project in the Democratic Republic of the Congo, in which it owns an 80% interest. Mpokoto has a current Total Mineral Resource of 678,000 oz Au from 14.58 Mt @ 1.45g/t Au at a cut-off grade of 0.5g/t. An Expanded Scoping Study for Mpokoto demonstrated a post-tax net present value of US$55.3m based upon a discount rate of 8% and a gold price of US$1,250/oz. The Project is subject to four Mining Licences which are valid for an initial term of 30 years from 30 September 2014. Armadale also currently holds approximately a 30% interest in Mine Restoration Investments Ltd, a South African listed company, focused on the briquetting and sale of coal fines in KwaZulu Natal, as well as a number of other quoted investments.

Short Name: Armadale Capital Plc
Category Code: MSC
Sequence Number: 496993
Time of Receipt (offset from UTC): 20151124T135008+0000


Armadale Capital Plc


Armadale Capital Plc