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Tanzania-focused mineral sands explorer appoints new leadership

7th October 2016

By: Simone Liedtke

Creamer Media Social Media Editor & Senior Writer

  

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ASX-listed mineral sands exploration company Strandline Resources recently appointed Luke Graham MD and CEO to lead the company in the execution of strategic development opportunities in Tanzania and Australia.

The company announced on September 5 in the midst of a major exploration and feasibility campaign in Tanzania that it was in a “very active” phase of aggressive exploration and resource building in the country.

The campaign involves drilling programmes across four high-priority targets aimed at extending known resources and new discoveries and these are expected to be completed next month.

Strandline is also undertaking an extensive 20 000 km, high-resolution survey over much of its Tanzanian land tenure, designed to significantly assist in delineating new zones of heavy mineral sands.

Strandline emphasised to Mining Weekly in an email interview that it is focused on advancing its priority mining projects – Fungoni, Tanga South and Madimba – in Tanzania, and is continuing to seek significant strategic and well-funded parties to realise value for its large, lower- grade mineral sands deposit at Coburn, in Western Australia.

“The Fungoni feasibility study is progressing well, with drilling and relogging identifying potential resource extensions that may extend the potential mine life and, therefore, economic returns,” former Strandline CEO and MD Tom Eadie said in the September announcement.

Graham takes over from Eadie, who will remain an active nonexecutive director and, together with Strandline’s other executives, “ensure a seamless transition of duties” over the coming months.

“Luke is a dynamic high-calibre leader, supported by a comprehensive understanding of the mineral processing industry, including being instrumental in the development, negotiation and execution of a current major international mineral sands project.

“Further, Luke has first-hand knowledge of Strandline’s current projects through his involvement in our business activities over the past five years as an engineering contracting partner,” states Strandline’s chairperson Didier Murcia.

Attractive Prospect

The company says its Tanzanian projects are strategically positioned in one of world’s major zircon- and titanium- producing corridors, and describes the country as a mining-friendly, politically stable jurisdiction with rapidly developing coastal infrastructure (ports and power).

With mineral sands mining to the north, in Kenya, and to the south, in Mozambique and South Africa, it is surprising that there was very little interest in Tanzania up until Strandline acquired its portfolio in 2014, comments the company.

Strandline states that, owing to its prospective projects portfolio and exploration success to date in Tanzania, mining companies, such as Iluka, Rio Tinto and Base Resources, are actively increasing their presence and activities in the country’s mineral sands sector.

Strandline further announced in the September statement that the drilling campaign to infill and extend existing high-grade mineral resources at Fungoni has been completed, adding a potential 400 m of strike to the previously defined mineralisation.

The company is preparing for a mineral resource update, bulk metallurgical testwork, optimal flow sheet design and marketing studies.

Eadie explains that at Fungoni – a relatively small, but high-grade mineral sands deposit near Dar es Salaam – the company is developing a near-term, low-cost project, with a financial investment decision to proceed with construction expected in the first half of 2017.

At Strandline’s Tanga South project, resource extension drilling of the Tajiri mineralised corridor has started between and along strike of the high-grade deposits, already defined within the 25-km-long mineralised corridor. Currently, the indicated resource is 59-million tonnes at a grade of 3.7% heavy minerals, of which 10% is rutile, 5% zircon, 4% leucoxene and 68% ilmenite. In addition, the exploration target of 100-million tonnes to 270-million tonnes at 3% to 5% total heavy minerals indicates that the project has similar grades and size potential to that of mineral sands producer Base Resources’ Kwale mine, 80 km to the north, in Kenya.

At Tanga South’s Tongoni and Pangani projects, maiden drill campaigns are being finalised, with the discovery of new zones of high-value mineralisation being targeted at these projects.

Following Strandline’s acquisition of mineral sands explorer Jacana Resources (Tanzania) in October 2015, which was an Australian unlisted company that was spun out of ASX-listed Syrah Resources, the company holds a dominant landholding position along the Tanzanian coastline, which it is systematically assessing through the drilling of high-grade prospects identified from airborne geophysical surveying, historical drilling data and surface sampling.

Shareholder Development

In May, Strandline signed a strategic relationship and subscription agreement with mining-focused private-equity group Tembo Capital, through which Tembo became a significant shareholder in Strandline.

“The discussions and negotiations with Tembo included rigorous due diligence and site visits over several months from late 2015,” says Eadie.

The agreement and recently completed rights issue, resulting in an aggregate cash injection of about $6.6-million in initial funding, will ensure that Strandline has funds to advance its portfolio of high-value Tanzanian mineral sands projects closer to production.

“Tembo has been very supportive to date and its nominated director, John Hodder, has provided excellent input into our processes and plans. Tembo has gone on record to say it is eager to further invest in Strandline as the various projects progress,” adds Eadie.

He highlights that Strandline has assembled its portfolio in Tanzania through the extensive assessment of data collected 15 to 20 years ago by historical explorers. When these groups left to pursue other commodities, the information lay dormant for a number of years. “Through access to this information and the geologist who managed many of these exploration programmes, the company was able to prioritise its targeting and choose the most prospective areas to develop,” says Eadie.

Tanzania, he notes, is a vibrant mining country with significant gold and diamond production, adding that the country’s universities and the mining industry produce “excellent mining professionals”, while its government understands mining and is determined to see that the mining industry becomes a bigger part of the Tanzanian economy.

Major underused ports at Tanga, Dar es Salaam and Mtwara are available to serve all Strandline’s prospective mining areas, with “Mtwara, in particular, becoming an industrial focal point with affordable natural gas and power”, Eadie highlights.

Edited by Tracy Hancock
Creamer Media Contributing Editor

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