LONDON (ShareCast) - (ShareCast News) - Natural resources investment company Armadale Capital announced on Monday the discovery of high grade graphite mineralisation at the Mahenge Liandu Graphite Project in south east Tanzania.
The AIM-traded firm said the mineralisation of up to 33.8% total graphite content has been demonstrated through analysis of rock chip samples taken from the Liandu Project, which Armadale is in the process of acquiring.

At the same time, Armadale said it has now largely completed its due diligence in relation to the project and anticipates entering into a binding agreement to complete the acquisition of Graphite Advancement Tanzania - the owner of the project - shortly.

"The Liandu Project represents a compelling opportunity for Armadale to get exposure to the burgeoning graphite market, with modest near-term capital expenditure and limited risk," said Armadale chairman Peter Marks.

"These samples further demonstrate the prospectivity of the project."

Marks said the Liandu Project is contiguous to Kibaran Resources' Epanko Project, which has "proven and probable" ore reserves of 10.9Mt at 8.6% total graphite content.

Kibaran holds an exclusive off-take agreement European multinational ThyssenKrupp.

"The project is also in close proximity to Black Rock Mining's Mahenge Project, which has a global resource of 131Mt at 7.9% TGC," Marks explained.

"The Liandu Project is in a premier graphite bearing region with world-class graphite projects neighbouring it, and these rock chip samples are what we hope to be the first step in us delivering a similarly exciting graphite project."

Marks said that in parallel with the development of the Liandu Project, Armadale is continuing to progress funding at the Mpokoto Project with discussions ongoing with A-MCS, who are reviewing the definitive feasibility study.

"In addition, management continues to review ways to improve the economics of the project, including assessing alternative options for the processing plant that have the ability to reduce the overall capital requirement and reduce the time to production.

"Armadale anticipates being able to update shareholders shortly on progress," Marks added.

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