REG - Jangada Mines PLC - Investee Company Update: Blencowe Resources PLC

Jangada MinesAnnouncement

10/06/2024 09:15

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240610:nRSJ7854Ra&default-theme=true

RNS Number : 7854R  Jangada Mines PLC  10 June 2024

Jangada Mines plc / EPIC: JAN.L / Market: AIM / Sector: Mining

10 June 2024

Jangada Mines plc ('Jangada')

 

Investee Company Update: Blencowe Resources PLC

 

Jangada Mines plc, a natural resources development company with interests in
Brazil and elsewhere, is pleased to note the announcement released by Blencowe
Resources PLC (LON:BRES) in which it holds a c. 10% interest.

 

Jangada Executive Chairman, Brian McMaster, said: "Our investment in Blencowe
is proving to be timely, fuelled by the robust dynamics of the graphite market
and the strength of its potential world class graphite project both by size
and end-product quality. Today's announcement of an offtake MOU with industry
leader Jilin, coupled with ongoing discussions with other top-tier offtakers,
underscores the strategic significance of Orom-Cross and reaffirms our
confidence in its exceptional potential."

 

Start of Blencowe Resources PLC announcement

 

10 June 2024

Blencowe Resources Plc (the "Company")

 

First Offtake MOU Signed for 15,000 Tonnes of Large Flake Per Annum

 

Agreement provides for sale of significant percentage of large flake end
products

 

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

·    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."

 

 End of Blencowe Resources PLC announcement

 

**ENDS**

 

For further information please visit www.jangadamines.com
(http://www.jangadamines.com/)  or contact:

 

 Jangada Mines plc                     Brian McMaster (Chairman)  Tel: +44 (0)20 7317 6629
 Strand Hanson Limited                 Ritchie Balmer             Tel: +44 (0)20 7409 3494

 (Nominated & Financial Adviser)       James Spinney

 Tavira Securities Limited             Jonathan Evans             Tel: +44 (0)20 7100 5100

 (Broker)

 St Brides Partners Ltd                Ana Ribeiro                jangada@stbridespartners.co.uk

 (Financial PR)                        Isabel de Salis

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDFIFLTRLIILIS