Name and Location
Mpokoto gold project, Katanga province, Democratic Republic of Congo.

Client
Armadale Capital.

Project Description
An expanded scoping study on Mpokoto has demonstrated that it is a robust, low-cost gold development project with attractive economic fundamentals, even at a gold price of $1 000/oz.

The project has a current total mineral resource of 678 000 oz of gold from 14.58-million tonnes grading 1.45 g/t of gold at a cutoff grade of 0.5 g/t to produce about 25 000 oz/y over a nine-year life-of-mine.

Net Present Value/Internal Rate of Return
The expanded scoping study has increased the project’s post-tax net present value (NPV) by 68% – based on a discount rate of 8% and a gold price of $1 250/oz – from $33-million in the previous study published in April 2014 to $55.3-million. The project has a payback period of 20 months.

Value
The total capital cost of the project is estimated at $20.4-million.

Duration
Production is targeted for the first half of 2016.

Latest Developments
Armadale Capital has raised £700 000 through the placement of 20-million new ordinary shares at 0.1p each in the capital of the company at a price of 3.5p apiece with institutional and other investors.

The funds will enable the miner to continue developing its Mpokoto gold project by starting groundworks in conjunction with drilling.

The funds will also be used for the completion of the definitive feasibility study (DFS), targeted for the third quarter.

“Having recently raised £400 000, we are delighted to have further bolstered our cash balance with this placing. We are optimistic that the DFS results will further enhance our already favourable project economics, which includes a net present valuation of $32.3-million, based on a forecast gold price of $1 100/oz,” Armadale director Justin Lewis has said.

He adds that completion of the DFS will represent another major development milestone and, importantly, form the basis of definitive agreements with Africa Mining Contracting Services group to fund, build and operate the Mpokoto mine.

“With funding secured and a defined route to production in place, which includes the recently finalised process route for gold recovery, I am delighted with the excellent progress we continue to make in advancing Mpokoto into production,” he has noted.

Key Contracts and Suppliers
Bara Consulting (DFS).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Armadale chairperson Peter Marks, tel +61 3 9824 8166, fax +61 3 9824 8161 email pmarks@armadalecapitalplc.com