Baobab Resources PLC Operations Update (3427L)
July 03 2014 - 5:00AM
UK Regulatory
TIDMBAO
RNS Number : 3427L
Baobab Resources PLC
03 July 2014
BAOBAB RESOURCES PLC
OPERATIONS UPDATE
3 JULY 2014
Baobab Resources Plc ('Baobab' or the 'Company') is wholly
focused in Mozambique where it is currently completing a Definitive
Feasibility Study ('DFS') at its pig iron and ferro-vanadium
project in the Tete province (the 'Tete Project'), one of Africa's
fastest growing mining and industrial centres. The International
Finance Corporation ('IFC') holds a 15% participatory interest in
the Tete Project. The Company is pleased to provide the following
update on activities.
HIGHLIGHTS
-- Pilot scale smelting trials are underway at Mintek
laboratories, South Africa, to investigate the behaviour of
vanadium during smelting and subsequent oxidation treatment.
Utilising a tilting furnace, c.45kg of pig iron product has
successfully been produced. This is further evidence of the pig
iron product, which can be produced from the Tete project. Below
are the assayed results of pig iron achieved through the smelt test
work.
Si Fe Ti Mn Cr Cu V Ni C S P
--- ----- ----- ----- ------ ----- ------ ----- ------ ----- ----- -----
% 0.18 95.0 0.17 0.060 0.29 0.027 0.53 0.073 3.51 0.13 0.11
--- ----- ----- ----- ------ ----- ------ ----- ------ ----- ----- -----
Distribution of vanadium as well as deleterious elements
(phosphorus, sulphur, copper, etc) has been tracked and will be
incorporated into a working mass balance. Initial results presented
above indicate a recovery of in excess of 75% vanadium to the hot
metal, which is in accordance with the bench scale test work
completed at CSIRO. It is important to note the low level of Cu and
also to mention that the levels of Sulphur, Phosphorous, titanium
and other deleterious elements will further reduce with the removal
of Vanadium.
Four to six 200g samples of pig iron will then be subjected to
vanadium recovery test work using various additives and levels of
oxygenation to determine optimised conditions for two larger (5kg)
tests to produce a sufficient amount of vanadium-rich slag for
subsequent characterisation.
Both pig iron and slag samples will be used for marketing
purposes.
-- Pilot scale direct reduction trials, using bulk samples of
Tenge oxide iron ore, Massamba carbonate and local thermal coal
product, are on-going at FLSmidth's test facilities in the USA. A
first round of kiln trials is now complete and a second is
scheduled to commence in the coming weeks. The objective of these
trials is to confirm the rotary kiln route as a suitable technology
with an accompanied process guarantee.
-- Marketing studies covering the merchant pig iron market, the
vanadium market and the supply/demand dynamics of steel production
in the Middle East have been completed. The combination of low cost
high quality Tete Pig Iron and competitive ocean freight to the
Middle East indicates a production cost advantage over Middle
Eastern produced DRI, placing Tete Pig Iron as an ideal raw
material source for an increasing focus on rebar manufacturing
capacity in this region.
The positive marketing results have been incorporated into
supplementary data packs for on-going discussions with potential
strategic partners in northern Asia and the Middle East, many of
whom were visited during the week of the 23rd June 2014.
Following an increased interest from technology providers who
can enhance/increase the concentration of TiO2 in slag into a
potentially saleable product, a marketing study of the TiO2 market
was commissioned in order to gain a better understanding of this
potential and how it can add to the economics of the Tete
project.
-- Progress is being made with regards to securing access to
port, rail and power with negotiations with both public and private
sector entities in advanced stages. Discussions concerning coal
off-take are also underway.
-- Technical logistics studies are well underway to ensure
economically feasible methods to evacuate the pig iron product from
the project site through to either the ports of Beira or
Nacala.
-- Geotechnical and hydrogeological drilling is complete and
will be incorporated into the pit optimisation, mine scheduling and
reserves classification studies being carried out by SRK
consultants.
-- The mining title application is ready for submission and work
has commenced on the drafting of the mining contract.
-- The environment, safety and health impact study (ESHIA),
resettlement action plan (RAP) and social development plan (SDP)
are all making solid progress and are largely on schedule.
Commenting today, Ben James, Baobab's Managing Director, said:
'overall we are very pleased with the progress being made on the
feasibility study. Results to date are in line with expectations
and continue to de-risk the asset. We are also running a continuous
process of reviewing and revising our process flow sheets and
capital and operating expenditure models to further optimise the
fundamentals of this already very competitive project.'
The information in this release that relates to Exploration
Results is based on information compiled by Managing Director Ben
James (BSc). Mr James is a Member of the Australasian Institute of
Mining and Metallurgy, is a Competent Person as defined in the
Australasian Code for Reporting of exploration results and Mineral
Resources and Ore Reserves, and consents to the inclusion in the
report of the matters based on the information in the form and
context in which it appears.
CONTACT DETAILS
Baobab Resources PLC
Ben James: Managing Director Tel: +258 21 415 200
Jeremy Dowler: Chairman Tel: +44 1372 450529
Frank Eagar: CFO Tel: +258 21 415 200
Grant Thornton UK LLP
Philip Secrett | David Hignell | Jamie Barklem Tel: +44 20 7383 5100
Shore Capital Group
Jerry Keen | Toby Gibbs Tel: +44 20 7468 7964
This information is provided by RNS
The company news service from the London Stock Exchange
END
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