Armadale Capital Plc (LON:ACP) Downstream Test-Work Commenced

Armadale Capital Plc, the AIM quoted investment group focused on natural resource projects in Africa, is pleased to provide an update on its Mahenge Liandu Graphite Project (‘Mahenge Liandu’) in Tanzania, as it rapidly progresses all key steps critical to building a viable commercial operation.


  • Commissioned Batterylimits in Perth, Australia, to expand scope of Definitive Feasibility Study (‘DFS’) to include downstream analysis on high-quality, high-purity flake graphite concentrate produced from Mahenge Liandu during the metallurgical test-work programme
  • The downstream test-work includes:
    • Spheroidisation of flake graphite concentrate;
    • Purification of spherical graphite;
    • Electrical characterisation of purified spherical graphite; and
    • Production of battery cells
  • Results critical in highlighting the extent to which graphite concentrate from Mahenge Liandu can be used to produce battery cells, a key data point for prospective Chinese off-take partners
  • Board optimistic that results will replicate excellent downstream test-work results announced by peers in the region such as ASX listed Black Rock Mining (ASX: BKT; Release dated 14 August 2019) that exceed the industry standard for battery anode materials

Nick Johansen Director of Armadale said: “Our priority in the lead up to the DFS being released towards the end of 2019 is to demonstrate that our commercialisation strategy is gaining momentum. To this end, we are delighted to commence downstream analysis of graphite concentrate, which will generate key data for our prospective Chinese off-take partners. With others in the region, such as Black Rock Mining, achieving their own excellent downstream test-work results, we are optimistic that Mahenge Liandu will deliver similar results to further enhance its already robust economics.”

Armadale continues to make excellent progress advancing one of the largest high-grade resources in Tanzania, the wholly owned Mahenge Liandu Graphite Project, which has a JORC compliant indicated and inferred mineral resource estimate of 51.1Mt at 9.3% TGC, including 38.7Mt Indicted at 9.3% and 12.4Mt at 9.1% TGC.

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 DFS based on the results of a Scoping Study that was completed in March 2018. In line with this, Armadale has commissioned Batterylimits in Perth, Australia, to expand the scope of the DFS to include downstream analysis on high-quality, high-purity flake graphite concentrate produced from Mahenge Liandu during the metallurgical test-work programme to verify it meets the stringent requirements of prospective Chinese off-take partners. In turn, a leading graphite processing specialist will undertake a series of tests to determine which high value products can be produced from the finished graphite concentrate product.

Notably, ASX listed Black Rock Mining (ASX: BKT), which also operates in the region, released excellent downstream test-work results on 14 August 2019 that exceed the industry standard for battery anode materials.

The Scoping Study verified Mahenge Liandu could produce a coarse flake, high-purity graphite product underpinning a compelling business case to progress commercialisation plans. Based on a 400,000tpa throughput, it highlighted the following key positive metrics:

  • 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; and
  • 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.


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