Mkango Resources Ltd. (AIM / TSXV: MKA) (the "Company" or "Mkango")
is pleased to provide an update on its major diamond drilling
programme underway at the Songwe Hill Rare Earths Project
(“Songwe”) in Malawi. The drilling programme is a key component of
the Feasibility Study for Songwe, which is being fully funded by
Talaxis Limited (“Talaxis”), a subsidiary of Noble Group Ltd.
- A total of 6,558 metres of drilling had been completed as at
August 8, comprising 52 drill holes to a maximum depth of
approximately 220 metres
- Multiple zones of carbonatite, the primary host rock for rare
earth mineralisation at Songwe, have been intersected to date
- Assay results from the first batch of samples from 8 drill
holes totaling 944 metres are expected to be announced by the end
of August 2018
- The second batch of samples from 6 drill holes totaling 721
metres were recently dispatched for assay, and further batches of
samples will be dispatched in coming weeks
- The drill programme is on track and is expected to total up to
approximately 10,000 metres, focused on infill drilling the
existing Indicated and Inferred Mineral Resource Estimates, testing
extensions to the mineralisation and geotechnical drilling
- Mkango completed two successful drilling programmes at Songwe
in 2011 and 2012, totaling approximately 6,850 metres and
culminating in a maiden Mineral Resource Estimate. Mkango is
targeting announcement of an updated Mineral Resource Estimate,
incorporating the results of the latest drill programme, by the end
of 2018.
On Mkango publishing a NI 43-101 technical
report in relation to the updated Mineral Resource Estimate,
Talaxis will invest a further £7 million to fund completion of the
Feasibility Study for Songwe.
William Dawes, Chief Executive Officer,
commented: “The drill programme is on track and we look
forward to updating the market with the first set of results.
Mkango is developing one of the few advanced stage rare earths
projects globally. It is fully funded and well positioned to
benefit from growing demand for neodymium and praseodymium used in
permanent magnet motors for electric vehicles. Our vision is to
develop a major new sustainable source of rare earths in Malawi,
with Mkango spearheading development of the sector. We are
receiving strong support from the Government of Malawi to fulfil
this vision. This includes commitments on infrastructure
developments to enhance the already favourable operating
environment.” Scientific and technical information contained in
this release has been approved and verified by Dr. Scott Swinden of
Swinden Geoscience Consultants Ltd, who is a "Qualified Person" in
accordance with National Instrument 43-101 - Standards of
Disclosure for Mineral Projects.
About Mkango Resources
Limited
Mkango's primary business is exploration for
rare earth elements and associated minerals in the Republic of
Malawi, a country whose hospitable people have earned it a
reputation as “the warm heart of Africa”. The Company holds
interests in three exclusive prospecting licenses in Malawi, the
Phalombe licence, the Thambani licence and the Chimimbe Hill
licence.
The main exploration target in the 80% held
Phalombe licence is the Songwe Hill rare earths’ deposit, which
features carbonatite-hosted rare earth mineralisation and was
subject to previous exploration in the late 1980s. Mkango completed
an updated Pre-Feasibility Study for the project in November 2015
and a Feasibility Study is currently underway, the initial phases
of which include a major drilling programme.
Under the terms of an agreement with Talaxis,
Talaxis will fully fund the Feasibility Study for Songwe by
investing £12 million for a 49% interest in the project (via Mkango
subsidiary Lancaster Exploration Ltd). Talaxis will also have the
option to acquire a further 26% interest by arranging funding for
project development including funding the equity component thereof.
If Talaxis exercises its option, Mkango will retain a 25% interest,
free carried to production. To-date, Talaxis has invested £5
million, which is funding the initial phase of the Feasibility
Study, for a 20% interest in the project with Mkango holding
80%.
By investing a further £2 million, Talaxis will
acquire a 49% interest in Maginito Ltd, a new subsidiary of Mkango
focused on neodymium alloy powders, magnets and other technologies.
This includes the collaboration with Metalysis Ltd announced in
September 2017, which is focused on advanced alloys using neodymium
or praseodymium with other elements for permanent magnet
manufacturing. Permanent magnets are critical materials for most
electric vehicles, direct drive wind turbines and many other high
growth applications. Neodymium is a key rare earth component at
Songwe. To date, Talaxis has invested £1 million for a 24.5%
interest in Maginito with Mkango holding 75.5%.
The main exploration targets in Mkango’s
remaining two 100% held licences are, in the Thambani licence,
uranium, niobium, tantalum and zircon and, in the Chimimbe Hill
licence, nickel and cobalt.
For more information, please visit
www.mkango.ca.
Market Abuse Regulation (MAR)
Disclosure
Certain information contained in this
announcement may have been deemed inside information for the
purposes of Article 7 of Regulation (EU) No 596/2014 until the
release of this announcement.
Cautionary Note Regarding
Forward-Looking Statements
This news release contains forward-looking
statements (within the meaning of that term under applicable
securities laws) with respect to Mkango, its business and the
Project. Generally, forward looking statements can be identified by
the use of words such as “plans”, “expects” or “is expected”,
“scheduled”, “estimates” “intends”, “anticipates”, “believes”, or
variations of such words and phrases, or statements that certain
actions, events or results “can”, “may”, “could”, “would”,
“should”, “might” or “will”, occur or be achieved, or the negative
connotations thereof. Forward looking statements in this news
release include statements with respect to the global market for
products using the rare earth metals the Company is exploring for,
completion of the feasibility study and of the transactions
contemplated in the Agreement, as well as the use of proceeds from
the investments into the Company by Talaxis and the timing of such
expenditures. Readers are cautioned not to place undue reliance on
forward-looking statements, as there can be no assurance that the
plans, intentions or expectations upon which they are based will
occur. By their nature, forward-looking statements involve numerous
assumptions, known and unknown risks and uncertainties, both
general and specific, that contribute to the possibility that the
predictions, forecasts, projections and other forward-looking
statements will not occur, which may cause actual performance and
results in future periods to differ materially from any estimates
or projections of future performance or results expressed or
implied by such forward-looking statements. Such factors and risks
include, without limiting the foregoing, market demand for the
metals and associated downstream products for which Mkango is
exploring, researching and developing, the positive results of a
feasibility study on the Project, delays in obtaining financing or
governmental or stock exchange approvals. The forward-looking
statements contained in this news release are made as of the date
of this news release. Except as required by law, the Company
disclaims any intention and assumes no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
applicable law. Additionally, the Company undertakes no obligation
to comment on the expectations of, or statements made by, third
parties in respect of the matters discussed above.
For further information on Mkango,
please contact:Mkango Resources
Limited
William DawesChief Executive
Officerwill@mkango.caUK: +44 207 3722 744Canada: +1 403 444
5979www.mkango.ca@MkangoResources
Alexander LemonPresidentalex@mkango.ca
BlytheweighFinancial Public
RelationsTim Blythe, Camilla Horsfall, Julia TilleyUK: +44 207 138
3204
SP Angel Corporate Finance
LLPNominated Adviser and Joint BrokerJeff Keating,
Caroline RoweUK: +44 20 3470 0470
Alternative Resource
CapitalJoint BrokerAlex Wood, Rob CollinsUK: +44 20 7186
9004; +44 20 7186 9001
The TSX Venture Exchange has neither
approved nor disapproved the contents of this press release.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
This press release does not constitute an offer
to sell or a solicitation of an offer to buy any equity or other
securities of the Company in the United States. The securities of
the Company will not be registered under the United States
Securities Act of 1933, as amended (the “U.S. Securities Act”) and
may not be offered or sold within the United States to, or for the
account or benefit of, U.S. persons except in certain transactions
exempt from the registration requirements of the U.S. Securities
Act.
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