Mahenge graphite project, Tanzania – update

16th June 2023 By: Sheila Barradas - Creamer Media Research Coordinator & Senior Deputy Editor

Mahenge graphite project, Tanzania – update

Photo by: Black Rock Mining

Name of the Project
Mahenge graphite project.

Ulanga district of the Morogoro region, Tanzania.

Project Owner/s
Australian mining company Black Rock Mining.

Project Description
Mahenge will be an openpit mining operation, based on mining the Ulanzi and Cascade deposits.

An independent review of the front-end engineering design (FEED) and an enhanced definitive feasibility study (eDFS) has confirmed the Tier 1-scale Mahenge project as robust, with attractive returns.

The project will use contract mining as proposed in the eDFS instead of owner operator mining.

Mahenge ore will be processed over the life-of-mine (LoM) using a four-stage approach where four process plants will be built sequentially in a modular format.

Processing throughput will initially be one-million tonnes a year when the Module 1 process plant is commissioned, increasing to two-million tonnes a year when Module 2 is commissioned, to three-million tonnes a year when Module 3 is commissioned and to four-million tonnes a year with the completion of Module 4.

The four stages will be developed over the initial years of the mine, with the current mine schedule indicating an LoM of 26 years, after which the current defined deposits will be depleted.

The Module 1 and 2 process plants will process ore from the Ulanzi deposit, while the Module 3 and 4 process plants will process ore from the Cascade and Epanko deposits.

The Module 1 process plant will be fed run-of-mine ore at an average grade of 8.24% total graphitic carbon and will recover an estimated 93% of this graphite to produce about 89 000 t/y of graphite products over the first 20 full years of production.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at a 10% nominal rate, of $1.38-billion and an internal rate of return 36%, with a payback of 3.8 years.

Capital Expenditure
Based on the FEED work, the updated capital cost estimate for the development of Module 1 is $182-million, including a contingency allowance of $22-million. Module 2 is estimated $107-million. The updated capital expenditure for modules 3 and 4 is estimated at $117-million and $104-million respectively.

Planned Start/End Date
Black Rock Mining is targeting first production from its Mahenge graphite project in 2024.

Latest Developments
Black Rock Mining will raise A$10-million in a share placement to institutional and sophisticated investors, to fund working capital for the completion of the debt process and project-level partner process for its Mahenge project.

The company has received commitments for the placement of more than 86.9-million shares, at 11.5c each, representing a 20.7% discount to Black Rock’s closing price on June 7, and a 14.9% discount to the company’s 15-day volume weighted average share price.

Placement participants will receive one free attaching option for every three shares subscribed, with the option exercisable at 20c each and with an expiry date of 24 months.

“We have several key derisking milestones due near term and this A$10-million placement should provide the company with sufficient cash reserves to complete the debt financing and partner processes,” Black Rock CEO John de Vries has explained.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Black Rock Mining, tel +61 8 9320 7550 or email