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

15 December 2021

Armadale Capital Plc

('Armadale' the 'Company' or the 'Group')

Management team enhanced with key appointment 

Armadale, the AIM quoted investment company focused on natural resource projects in Africa, is delighted to announce that Mr Greg Entwistle has agreed to join as Project Director (non-board) to spear-head developing the Mahenge Liandu Project in Tanzania. Mr Entwistle brings a wealth of experience to the group which should materially aid Armadale's efforts to accelerate commissioning mining operations at the Mahenge Liandu Project. 

Mr Greg Entwistle: Project Director

Mr Entwistle has an excellent pedigree and has worked across all aspects of the resources value chain - from feasibility through to production - in emerging and developed mining jurisdictions. During his career Mr Entwistle has worked for blue-chip Newcrest Mining as Engineering and Production Manager for the Telfer Operation in Western Australia and Halmahera Operation in Indonesia. Senior roles include Director of Operations for Agincourt Resources in Indonesia as well as Chief Operating Officer for the Kapulo & Dikulushi Copper Projects in the Democratic Republic of Congo.

Over the past five years, Mr Entwistle has focused on specialising in the emerging graphite sector in East Africa, consulting to several groups that are advancing projects towards production.  

From Armadale's perspective, Mr Entwistle's appointment is timely as it coincides with a plethora of positive developments including:  1) the Mahenge Liandu Project being granted a mining licence in September 2021; and, 2) improving fundamentals with strong demand for downstream battery products boosting graphite prices materially.

Nick Johansen, Director of Armadale, said: "Appointing Greg Entwistle to lead developing the Mahenge Liandu Project is a significant breakthrough, as he brings considerable skills and experience to expedite progress towards commissioning production. Consequently, our vision to become a significant low-cost graphite producer has been considerably reinforced. The Board looks forward to updating the market as fresh developments materialise."  

MAHENGE LIANDU PROJECT UPDATE

Armadale is now advancing its FEED study which includes geotechnical studies on the plant and tailings dam locations, with final design of the tailings dam and detailed design to be completed. In addition, a ground water study has been initiated to facilitate the development of production bores.

Armadale has continued to engage with international and local contractors to develop strategies in regard to the construction and implementation of the project. Final alignment of the site access route is being developed which will allow final design work to be completed.     

·    Mahenge Liandu Graphite Project established as a large, long life graphite deposit capable of producing high quality graphite concentrate for the rapidly emerging EV market through optimised Definitive Feasibility Study ('DFS')

o  High-grade JORC compliant indicated and inferred mineral resource estimate of 59.48Mt @ 9.8% TGC with outstanding purity of up to of 99.99% TGC achievable using conventional treatment

o  US$985m pre-tax cashflow to be generated from initial 15 year mine life utilising just 25% of the resource, which remains open in multiple directions offering significant further upside

o  Estimated pre-tax NPV of US$430m and IRR of 91%

o  Average annual production of large flake high-purity graphite of 109ktpa

·    Low cost, fast-tracked production to be delivered through staged ramp-up

o  60,000tpa graphite concentrate to be produced for the first three years (Stage 1) before increasing to life of mine average of 109,000tpa (Stage 2)

o  Low capital cost estimate - Stage 1 is US$39.7m, including contingency of U$S4.1m or 15% of total direct capital cost with 1.6 year (after tax) payback period from first production based on an average sales price of US$1,112/t

o  Stage 2 expansion to be funded from cashflow

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU No. 596/2014) which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.