TIDMBRES
RNS Number : 5654V
Blencowe Resources PLC
10 August 2020
Date: 10 August 2020 Blencowe Resources Plc
("Blencowe" or the "Company")
First Stage Value-Add Completed at Orom-Cross
The Company is pleased to provide an update on all progress to
date since its acquisition of the Orom-Cross Graphite Project in
April, and its return to trading on LSE immediately thereafter.
Highlights
The Company's Prospectus laid out its intention to fast-track
value creation for the Project, by moving Orom-Cross up the
development curve as quickly as possible through a combination of
drilling and metallurgical studies. The key requirements to fulfil
this were identified as follows;
-- A substantial diamond drilling programme to deliver enough
resource to support an initial mine life of over ten years.
-- A maiden JORC Resource for the asset, to provide both the
Company and industry participants sufficient confidence with
respect to the development of a modest part of Orom-Cross.
-- Completion of further metallurgical test work, using samples
from this drilling programme to better understand end product from
the area considered for initial mining.
-- Complete land acquisition and social responsibility
programmes to ensure on-the-ground support.
-- Develop key relationships in-country to ensure ongoing support and activities moving forward.
-- Deliver a first commercial model outlining an initial mining
scenario, once all drilling and metallurgical test work has been
successfully completed.
Blencowe is pleased to report that a number of these objectives
have already been met this year, with the balance expected to be
completed by year end. This has been achieved despite the various
challenges faced via Covid-19 restrictions in both Uganda and
UK.
A 69-hole (1,950m) diamond drill programme was planned, executed
and completed, with initial results looking positive. These
included the discovery of a new high grade lode of graphite, which
was subsequently drilled within the original drilling budget and is
expected to boost the overall JORC Resource estimate. The drilling
programme also reconfirmed the Company's belief that the majority
of the Orom-Cross deposit contains larger flake size graphite,
which commands a significant premium in terms of pricing per
tonne.
Logging of core has been completed and samples are in transit to
JORC-accredited labs in Tanzania ahead of the delivery of a maiden
JORC Resource for Orom-Cross before the end of 2020. Due to the
vast size and scale of the asset this initial JORC is expected to
be on just 1% of the overall deposit, however, it will represent a
key step forward and is expected to provide sufficient resources to
deliver the Project into first production with a mine life in
excess of ten years.
In parallel to those samples sent to Tanzania, samples will also
be sent to Canada for metallurgical testing by the experienced and
market leading graphite specialist SGS, who have done similar work
for many other graphite projects worldwide. This work will not only
reconfirm the data from Tanzania, but also identify what the exact
end product (concentrate) at Orom-Cross will look like and the
process flow to deliver that. Upon receipt of these findings,
Blencowe will be able to look to enter into discussions with
potential off-takers and industrial consumers to aid with the
financing of the ultimate development.
The Company has continued to engage the local community,
including making payments to those impacted, as set out within the
terms of the mining license. This support is considered vital to
the long term viability of Orom-Cross and Blencowe is pleased to
report that these funds have already been utilised for tractors and
other equipment necessary to assist local communities in the area
to grow their crops. In terms of disruption, both Orom-Cross and
surrounding area benefit from limited existing settlement and as a
result the requirement for relocations of households is expected to
be minimal. However, the Company remains keen to support the
regional community and will continue in both its dialogue and
direct investment efforts to help boost the development of the
region.
Further positive meetings and discussions with senior Government
officials have continued, with an underlying tone of support and
goodwill. Blencowe is grateful of their ongoing support, which is
crucial in terms of long term viability of the Project and its
subsequent impact on the local economy.
Significant new cash was raised in London to provide the means
to deliver this work programme and an experienced management team
is now in place and working hard to continue to deliver on all
programmes ahead.
Blencowe is a firm believer that demand for high quality flake
graphite will surge in the next decade. This is to be driven by not
only the demand in retardants, which require exclusively a larger
flake size graphite product (as expected in Orom Cross), but also
as the demand for lithium-ion (Li-ion) batteries exponentially
increases, to store energy for electric vehicles and other
renewable sources. Flake graphite is a key component of the anode
within the Li-ion batteries and technical experts suggest that this
battery will remain the primary product in this market over the
medium and longer terms. Several larger graphite projects worldwide
have either ceased or reduced production due to a wide variety of
issues, whilst many of the existing deposits and proposed future
developments are located in less stable regions across the globe.
Accordingly, the Company believe that the graphite market may be in
shorter supply in the future than the market is currently
considering, whist the location of Orom-Cross in a stable African
jurisdiction should make it more desirable to a potential
off-takers looking for surety and continuity of supply.
Cameron Pearce Executive Chairman's commented;
"This has been a very active and successful quarter since we
brought in this excellent project, and recommenced trading on the
LSE. This has been achieved against the backdrop of the COVID-19
pandemic and I thank all those working on the Project who have
continued to progress Orom-Cross in these truly unprecedented
times."
"The Board have no doubt that Orom-Cross is a world class
graphite deposit, given its size and expected grades and flake
sizes. We have a clear strategy to move the asset forward as
rapidly as possible towards production. The first step to achieving
this will be the publication of the maiden JORC Resource later this
year, followed by the results of the metallurgical studies. The
Company is well-funded to achieve these objectives following this
year's capital raise and I look forward to updating shareholders in
due course."
For further information please contact:
Blencowe Resources Plc
Sam Quinn (London Director)
www.blencoweresourcesplc.com
Tel: +44 (0)1624 681 250
info@blencoweresourcesplc.com
Brandon Hill Capital Limited
Jonathan Evans (Corporate Finance) Tel: +44 (0)20 3463 5000
jonathan.evans@brandonhillcapital.com
Background
Orom-Cross is a potential world class graphite project both by
size and end-product quality, with a high component of larger
flakes identified from previous work performed. A 21-year Mining
Licence was issued by the Ugandan Government in 2019 following
extensive historical work on the deposit.
Orom-Cross presents as a large, shallow open pitable deposit,
with an estimated resource in excess of 3 billion tonnes of
graphite. Development of the resource is expected to benefit from a
low strip ratio and free dig operations, thereby ensuring lower
operating and capital costs.
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END
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