Name of the Project
Mahenge graphite project.

Location
South-east Tanzania.

Project Owner/s
Black Rock Mining.

Project Description
Mahenge will be an openpit mining operation based on mining the Ulanzi and Cascade deposits using a conventional truck-and-shovel method.

The deposit is the fourth-biggest Joint Ore Reserves Committee-compliant contained graphite resource in the world.

In July 2019, Black Rock released an enhanced definitive feasibility study (DFS) on the project.

Ore will now will be processed using a four-module approach over 26 years, a decrease in the life-of-mine (LoM) of 32 years estimated in the DFS. Total LoM production has increased from 6.6-million tonnes in the DFS to 7.4-million tonnes in the enhanced DFS.

Conventional opencut techniques will be used to mine.

Processing will be undertaken using well-proven crushing, grinding and flotation methods, comprising:

Module 1, which will include a processing plant and infrastructure at a nominal design basis rate of one-million tonnes a year to produce up to 83 000 t/y of graphite concentrate in the first two years of production. The plant will be based at the Ulanzi pit.

Module 2, which will include a second one-million-tonne-a-year plant and associated additional infrastructure, doubling throughput to two-million tonnes a year, and graphite concentrate production to 167 000 t/y from Year 3 of operation. Module 2 includes some shared equipment with Module 1. The plant will be based at the Ulanzi pit.

Module 3, which will include a third one-million-tonne-a-year plant and associated additional infrastructure, increasing throughput to three-million tonnes a year, and graphite concentrate production of up to 250 000 t/y from Year 3 of operation.

Module 4, which will produce an additional 85 000 t/y of graphite concentrate, increasing total steady-state production to between 340 000 t/y to 350 000 t/y of graphite concentrate.

The additional mill feed in the enhanced DFS will be sourced by developing a third pit at the Epanko deposit.

Epanko ore is exclusively incorporated into Module 4, with production starting in Year 7 of the compressed schedule.

Epanko will contribute 9.9-million tonnes at 6.7% total graphitic carbon (TGC) for an additional 660 000 t of concentrate.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The projected after-tax net present value of the project has increased by 30%, from $895-million in the DFS to $1.16-billion in the updated DFS, with the internal rate of return having increased from 42.8% to an estimated 44.8%.

Capital Expenditure
Total capital expenditure for all four modules is estimated at $337-million.

Module 1 capital costs have increased from the $115-million estimated in the original DFS to $116-million in the updated DFS.

Module 2 capital costs are estimated at $69.5-million.

Module 3’s capital costs have increased marginally from $84.2-million in the DFS to $85.3-million in the enhanced DFS.

Module 4 will cost $67.1-million.

The $222-million required for modules 2, 3 and 4 will be funded from in-house cash flow.

Planned Start/End Date
First production from Mahenge has been targeted for between 2020 and 2021, with the timing of the first production subject to finance.

The enhanced DFS has noted that the development schedule, subject to financing and confirmation of the Tanzanian government’s 16% free carried interest, will consider four production modules, one a year after the first module, rather than every two years as indicated in the DFS.

Latest Developments
Black Rock Mining has reported a 25% increase in the measured resource at its Mahenge graphite project.

The resource upgrade comes as a time when the company ramps up project execution activities at Mahenge. The increase in the resource estimate provides customers and financiers with confidence in the planned production output over the first ten years of operations from the Ulanzi openpit, the company has said.

Mahenge’s global mineral resource estimate totals 213.1-million tonnes, at 7.8% TGC, with the measured resource comprising 31.8-million tonnes and the indicated resource estimated at 84.6-million tonnes.

“As part of our ramp-up activities associated with completing the engineering design for Mahenge Module 1, we have completed assays on metallurgical drill core and bulk samples specifically taken to support the final qualifications of the project. Processing of these samples is an outcome of POSCO’s equity investment of 15% of the company,” Black Rock CEO John de Vries has said.

“It is pleasing to see that, as a result of the increased confidence in Ulanzi, and the outcome of this campaign, Mahenge now has the largest measured mineral resource of any graphite developer or operation globally. This directly translates to reduced investment risk for debt and equity investors, with the first ten years of production now underpinned entirely by measured mineral resource,” he has added.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Black Rock Mining, tel +61 8 9320 7550 or email info@blackrockmining.com.au.