Armadale Capital announces high-grade results at Mahenge Liandu

Published at Nov 8, 2016, in Mining

AIM quoted investment company, Armadale Capital Plc (ACP), has released initial assay results from its Mahenge Liandu graphite project located in Tanzania.

It should be noted that for political and social reasons, this is a very high-risk stock. Getting mining projects up and running in countries such as Tanzania is no simple feat, and there may be challenges ahead. Investors interested in this stock should seek professional financial advice.

ACP’s chairman, William Frewen expressed his delight at the results saying, “These initial assay results are outstanding and of particular importance is the confirmation of near surface high grade graphite mineralisation of up to 26% Total Graphitic Carbon (TGC)”.

Importantly, the grades listed below are consistent with those delineated from assay results gathered in 2015 which included 60 metres grading 10.7% TGC and 5 metres grading 21.5% TGC.

To provide some perspective regarding these results, management noted the confirmed resources of other prominent players in Africa including Black Rock Mining (131 million tonnes at 7.9% TGC), Kibaran Resources (10.9 million tonnes at 8.6% TGC) and Volt Resources (446 million tonnes at 5.01 TGC)

Further positive news may be imminent with the remaining assay results for 2016 to be announced shortly. Management also said that further feedback on JORC modelling would be completed by the end of the December 2016 quarter, while also expressing a degree of optimism regarding the size of its graphite resource.

One of the promising aspects of these most recent results is the fact that they continue to provide evidence of near surface mineralisation, a factor that is important in terms of reducing extraction costs and optimising commercial viability.

Existing infrastructure provides clear path to development

ACP has recently undertaken a preliminary review of infrastructure and logistics requirements for mining operations to commence, including options regarding bringing its product to market.

Key takeaways were the proximity of mains power within 5 kilometres of the mine site and plentiful supply of groundwater.

From a transport perspective, it is approximately 80 kilometres by road from the mine site to a rail hub at Ifakara. Product could then be transported by rail (320 kilometres) to the deep sea port of Dar es Salaam.

Adequate labour and materials can be accessed from the town of Mahenge which is situated only 10 kilometres from the mine site.

Graphite remains a macro driven story

As highlighted by management, the macro environment for graphite remains buoyant, driven by new technologies including electric vehicles.

ACP referenced a Deutsche Bank report which cited lithium-ion battery capacity to grow by 200 GWh by 2020 as a result of more than 10 groups building gigafactories, including Tesla’s US$20 billion Nevada facility.

Translating this to industry dynamics for spherical graphite, an additional 400,000 tonnes would be required to meet these needs, implying a four to fivefold increase relative to 2015 levels.

Extrapolating these numbers further, ACP suggested that should 65% of the feedstock be naturally sourced, the application of a yield ratio of 50% would potentially imply an additional 520,000 tonnes of graphite concentrate is required.

Forward-looking estimates may or may not be met. As such, conclusions drawn in relation to interim and incomplete data should be considered speculative in nature and independent financial advice should be sought if considering this stock.


Where to invest $1,000 right now

When the experts at Next Investors have a stock pick, it may pay to listen.

The Next Investors have been investing in ASX small cap stocks for years, with their best small cap picks yielding returns of 1,200%, 1,120%, 900% and 678%.

They have just revealed their hand-picked, FY2021 stock portfolio of high conviction long-term investments.

Click the link below to see what they are currently investing in.


SEE THE PORTFOLIO

tags

GRAPHITE

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X