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Blencowe Resources #BRES – Alan Green talks to MD Mike Ralston
Alan Green talks to Blencowe Resources #BRES MD Mike Ralston. We cover progress with the DFS and the recent Orom Cross graphite testing in China before covering today’s maiden offtake agreement with Chinese graphite giant Jilin for the large flake product. Mike then discusses the plans for pilot plant production could commence at Orom Cross in 2026, plus other potential deals offtake partners and graphite producers and comparisons to peer group. We then discuss funding from an investor network in Africa, and the $5m package from the US Government’s International Development Finance Corporation, before Mike gives a heads up on likely events in the coming months.
Blencowe Resources #BRES – First Offtake MOU Signed for 15,000 Tonnes of Large Flake Per Annum
Blencowe Resources signs its first non-binding Memorandum of Understanding (“MOU”) for natural large flake concentrate offtake from the Orom-Cross Graphite Project. Partnering with Jilin New Technology Graphite Co. (“Jilin”), a prominent global graphite consumer, this initial MOU is the first of several offtake agreements anticipated to complete in the near future ahead of completing the DFS.
Highlights:
- Agreement provides for sale of significant percentage of large flake end products
- Offtake Supply Agreement: MOU to supply 15,000t/annum of blended large flake graphite, covering 66% of Orom Cross initial large flake production for up to three years from start.
- Industry Leader Jilin is a leading processor of battery anode materials and expandable graphite based in north east China.
- Pricing Terms to Follow: Pricing to be agreed under the terms of a formal agreement to be
entered into following completion of the Orom-Cross Definitive Feasibility Study (“DFS”). - Higher Revenue Contribution: As large flake concentrate commands substantially higher
prices than small flakes this MOU covers approx. 50% of the total revenue from Orom-Cross. - Product Validation through Testing: Initial offtake MOU follows substantial test work,
validating product quality. - Advanced Pilot Plant Progress: 600-tonne bulk sample test program nearing completion,
facilitating direct engagement with potential customers for small flake concentrate. - Ongoing Tier-One Discussions: Following successful trip to China and South Korea, Blencowe maintains positive discussions with tier-one offtakers worldwide for the balance of its planned
annual graphite production.
Jilin MOU
The Jilin MOU follows extensive discussions between Blencowe senior management during the recent visit to China, and follows successful bulk testing of graphite concentrate produced by Orom-Cross.
Jilin, a leading vertically integrated graphite producer, is the parent company of the group that completed the 100 tonne bulk sample for Blencowe in 2023 and is currently undertaking the 600t bulk sample processing program which is nearing completion.
The 600t bulk sample will generate commercial scale graphite concentrate divided into large and small flakes. The small flake concentrate will be upgraded to 99.95% by a leading Chinese SPG (spheronised purified graphite) producer, to be distributed to OEMs thereafter for their own testing. Completion of this exercise will be in Q3 2024, facilitating qualification of Orom-Cross small flake products with tier-one offtakers and paving the way for offtake agreements (currently under discussion). This small flake qualification process leading to offtake agreements, which often takes several years, has been expedited by Blencowe who will have completed it in a much shorter timeframe than other graphite companies.
Unlike small flake product, large flake products do not require the same qualification process, hence the more rapid move to signing this first MOU.
Orom Cross Production
The Pre-Feasibility Study envisages Orom-Cross initially delivering 50,000tpa of concentrate post commencement of full mining operations. Approximately 45% of this will be delivered as large flake products which means that the Company will have up to 22,500t per annum of large flake capacity to sell.
This Jilin MOU thus encompasses two-thirds of the company’s proposed steady state production of large flake graphite products (+100mesh, +80mesh and +50mesh) within the first three years. Thereafter it is anticipated the overall production volume will ramp up substantially. Given that large flake concentrate commands substantially higher prices than small flakes, this 15,000tpa to Jilin represents nearly 50% of the anticipated initial total revenue from Orom-Cross, underscoring the MOU’s significance in the context of future project financing and returns.
Other MOUs
Blencowe is currently in advanced negotiations with multiple leading OEMs in China and South Korea regarding the sale of its remaining large flake products and smaller flake products utilised in batteries. These discussions have been positive and the Company anticipates delivering further MOUs with leading buyers of graphite products worldwide with the aim of securing offtake partners for the entire production output from Orom-Cross.
Executive Chairman Cameron Pearce commented:
“This MOU is a key milestone for the Company and it is just the beginning. We anticipate announcing several more agreements over the next few months. Jilin is a leading graphite company globally and this is a strong endorsement of the graphite product from Orom-Cross. The 600-tonne bulk testing program will allow us to provide concentrate to qualify our small flake products through a rigorous qualification process so that we can progress offtake discussions with other tier-one consumers of graphite. We have been able to fast-track what is typically a lengthy process and look forward to completing this qualification process shortly by delivering the relevant concentrate and SPG to these groups.”
“This key milestone reflects the rapid progress we have made. Over the coming months we expect to maintain momentum by securing further MOUs and advancing the DFS. Each step brings us closer to unlocking more value and further de-risking the Orom-Cross project. We look forward to delivering further updates on project key components particularly results of our 600-tonne testing programme and further on offtakes.”
For further information please contact:
Blencowe Resources Plc Sam Quinn www.blencoweresourcesplc.com
Tel: +44 (0)1624 681 250
info@blencoweresourcesplc.com
Investor Relations Sasha Sethi Tel: +44 (0) 7891 677 441
sasha@flowcomms.com
Tavira Financial Jonathan Evans Tel: +44 (0)20 3192 1733
jonathan.evans@tavira.group
Tel: +44 (0)20 3192 1733
Twitter https://twitter.com/BlencoweRes
LinkedIn https://www.linkedin.com/company/72382491/admin/
Background
Orom-Cross Graphite Project
Orom-Cross is a potential world class graphite project both by size and end-product quality, with a high component of more valuable larger flakes within the deposit.
A 21-year Mining Licence for the project was issued by the Ugandan Government in 2019 following extensive historical work on the deposit and Blencowe has moved into the Definitive Feasibility Study phase as it drives towards first production.
Orom-Cross presents as a large, shallow open-pitable deposit, with a maiden JORC Indicated & Inferred Mineral Resource deposit of 24.5Mt @ 6.0% Total Graphite Content. Development of the resource is expected to benefit from a low strip ratio and free dig operations, thereby ensuring lower operating and capital costs.
#BRES Blencowe Resources PLC – Bulk Sampling Update & China Visit
Highlights:
· Blencowe has successfully completed a critical component of the Definitive Feasibility Study (“DFS”), with the successful scaled commercialisation of the flowsheet within the bulk sample processing at Chinese pilot plant graphite production facility.
· Results continue to highlight a high-grade, low impurity concentrate can be delivered in bulk from Orom-Cross.
· Several meetings held with leading Chinese graphite offtake firms seeking both large flake and fines concentrates.
· Ugandan mining officials visited China with Blencowe and were shown the process facility in support of the project.
· Blencowe now approached for downstream processing opportunities.
Blencowe Resources Plc (“Blencowe” or the “Company”), is pleased to provide an update on the 100 tonne bulk sample processing program currently underway. The work is being completed by a leading graphite technical specialist firm, Jilin New Technology, based in Yanji Province in northern China. This experienced graphite facility has been conducting similar test work on several other leading East African graphite projects over the past few years.
The Company is expecting the bulk sample test program to be completed by the end of August.
Senior Company personnel travelled to China recently to review the progress on the bulk sample processing and broaden relationships in this key market. Accompanying the COO was the Company’s Ugandan Country Manager and a representative of the Ugandan Directorate of Geological Survey and Mines (DGSM), with the express purpose of evaluating the progress of the processing and to demonstrate the full process for the Ugandan Government.
Following a refinement of the Pre-Feasibility Study processing methodology by Wuhan University specialists, Blencowe wished to confirm directly with the pilot plant operators the expected improvements in both overall recovery and concentrate grades and secure early samples for delivery to potential offtake partners, following a marked increase in interest for the projects’ concentrate within China. The 100 tonne pilot plant process is currently nearing completion and to date it is confirming the commercial processing viability of the Orom-Cross ores. The Company also visited operating graphite plants and graphite processing equipment suppliers.
Following the distribution of concentrate samples to potential end users from the IMO test work and Wuhan University 150kg test work, several large downstream offtake processors requested meetings to discuss timing and availability of the high-grade, low impurity concentrates from the Orom-Cross project. The offtake meetings involved firms seeking substantial quantities of both larger flake concentrates and fines feedstock for the SPG processors. Several downstream processing firms have expressed interest in opportunities to explore in-country downstream processing of the Orom-Cross concentrates and Blencowe will consider this within the DFS that is underway.
Blencowe was pleased to be able to escort a representative of the Ugandan Directorate of Geological Survey and Mines to view the final processing of the bulk sample. Blencowe invited the DGSM representative to view the process in order to continue to develop a better understanding of the processing technology involved, to foster a deeper overall understanding of the project within Uganda, and to continue to work in partnership with the Government in order to develop the project.
For further information please contact:
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Blencowe Resources Plc Sam Quinn |
www.blencoweresourcesplc.com Tel: +44 (0)1624 681 250
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Investor Relations Sasha Sethi |
Tel: +44 (0) 7891 677 441
|
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Tavira Financial Jonathan Evans |
Tel: +44 (0)20 3192 1733 jonathan.evans@tavira.group
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First Equity Limited Jason Robertson |
Tel: +44(0)20 7330 1833 jasonrobertson@firstequitylimited.com
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