TIDMCMET
Capital Metals PLC
19 July 2021
19 July 2021
Capital Metals plc
("CMET" or the "Company")
Progress on the ground
Commitment to the development of the local economy
and environmentally responsible mining
Capital Metals plc (AIM: CMET), a natural resources company
focused on the development of the Eastern Minerals Project in Sri
Lanka ('the Project'), one of the highest-grade mineral sands
projects globally, is pleased to provide a further progress update
on activities on the ground in Sri Lanka.
Our Sri Lanka management team has held several meetings with the
relevant government authorities and report that good progress is
being made with the environmental process, and the Company is
expecting further news on this in the coming weeks.
In addition, CMET is pleased to provide the following background
information on the Project's potential to open new economic
opportunities in eastern Sri Lanka, and the Company's work with
local communities and commitment to ecologically sensitive
production procedures that ensure all mining areas are fully
rehabilitated.
Highlights - Benefits to Community from development of the
Project
-- New high quality construction, mining and processing work for
local workers, and demand for local contracting services.
-- Community initiatives include waste disposal programmes,
ongoing financial and logistical support for a new pre-school, new
drinking water infrastructure, sponsorship of female
entrepreneurship, and Covid-19 support.
-- Full consultation with the local community on any potential
environmental impact from the Project, and commitment to
state-of-the-art mineral sands processing integrating land
rehabilitation into the mining process.
Contributing to Sri Lanka's economic development
The Project has been greatly assisted by the Sri Lankan
government's investment in the Eastern Province's infrastructure. A
network of sealed roads connects the licence area to Oluvil Port,
just 30 kilometres north of the initial mining area, which opened
in 2013 as part of the Sri Lankan government's ongoing programme to
upgrade the country's infrastructure, with assistance from foreign
investors.
The Oluvil Port was constructed for both the regional fishing
industry and commercial shipping including facilities and shipping
capacity - 8,000 to 10,000 tonnes to a depth of 11 metres, which is
suitable for CMET's requirements. The port is well equipped with
the infrastructure necessary to serve as a commercial harbour,
including grid power , scheme water, office, workshop, storage
facility, residential quarters, and secure perimeter walls and
fencing.
The Oluvil Port has been operating for the local fishing
industry but used only intermittently for commercial shipping. Due
to the low level of activity at the Port, there is now a
significant volume of sand that has filled due to the coastal
currents depositing sand in the harbour. As a result, the fishing
industry's access has been restricted. The Project is looking to
become an anchor tenant and user of the port and would undertake
regular dredging to keep the Port operational for all users of the
Port.
In turn, the Project promises to create high quality jobs for
local workers, and to act as a catalyst for local services. The
Company's construction, mining and processing work will employ
local workers, who will be trained and supported by local and
foreign mining expertise. Demand for contractor services is
expected to create a multiplier effect benefiting the wider economy
and skills/knowledge transfer to the local work force. Taxes and
royalties flowing from CMET's operations will generate government
revenues for reinvestment in Sri Lanka's continued economic
development. The Country will also benefit from foreign direct
investment to bring the mine in to production and export earnings
from the sale of the products into the international market.
Work with the local community
The economic activity stimulated by the Project will be
complemented by the Company's ongoing engagement with the Eastern
Province's local community. CMET has already demonstrated its
commitment to the coastal environment in which it will operate by
organising beach cleaning programmes with community leaders,
including the Sivan temple at Thambiluvil, with the collected
plastic waste transported to the local council refuse centre for
ecological disposal.
For the past three years, the Company has sponsored a new
pre-school in the village of Umiri, currently supporting 15
students and two teachers, where residents have struggled for years
for the resources to secure a good education for their children.
CMET has worked in partnership with the local authority and village
council to furnish a village hall with new furniture, stationery
and equipment, and provides ongoing support through building
maintenance, payment of school staff salaries, replenishment of
school stationery, transportation, and the supply of safe drinking
water through drier months. The Company is currently working with
the village to provide long term drinking water facilities.
CMET is working closely with local communities in another
village within the Project area, , Srivallipuram, to empower female
entrepreneurs supplying furniture, chairs, and other essentials for
the Women's Rural Development Society. One initiative helps members
of the Society and other local women embrace sustainable
agricultural practices through home gardening and small-scale
farming projects.
The Company is also contributing to local efforts to manage the
impact of Covid-19. Many families have needed financial support to
continue to pursue their livelihoods. CMET has worked with
community leaders to source and distribute dry ration packages for
65 families, ensuring the operation adheres to guidelines set by
local health authorities. At all times the Company's work is
designed to complement the wider programmes run by local and
national governments and international development agencies.
Environmentally sensitive mining
CMET is committed to pursuing a state-of-the-art mineral sands
mining process that will respect the coastline along which the
Project will operate.
The Project's commercial mineral sands, including zircon, the
titanium ores rutile and ilmenite, and garnet, will be extracted
using proven non-chemical processing methods. The proposed mining
method is staged mining of small 150m x 50 m cells, with each cell
continuously rehabilitated after mining and then fully available
for alternative uses such as agriculture and tourism, or to remain
as a wilderness.
Well regulated mineral sands programmes integrate land
rehabilitation into the mining process. The shallow depth of
mineral sands deposits allow them to be mined using conventional
surface mining methods including bulldozers, excavators and trucks.
Topsoil, subsoil and clay is removed and stockpiled separately to
allow it to be progressively returned after the mining process. The
mineral sand deposit is then removed from the ground and then
pumped as a slurry to a processing plant where the valuable heavy
minerals are separated from the sand. The waste sand (mostly
silica) is pumped back to the mining cell, where it is returned to
the ground. Subsoil and topsoil are then replaced and the land
rehabilitated back to its original use.
CMET's economics will be enhanced by the Project's expected high
grades. The Project has a JORC Resource of 17.2 Mt with an average
grade of 17.6% Total Heavy Minerals (THM), an estimate making it
one of the highest-grade mineral sands deposits in the world, with
nearly three times the average grade of comparable projects. 85% of
the resource estimate is classified in the JORC code's higher level
Measured and Indicated categories. Low levels of slimes - the fine
grained material that attaches to the mineral sands - are expected,
minimising the resources required for operations to separate
commercial from non-commercial materials. Only 10% of the Project
area has been drilled to date so increasing the resource estimate
through further drilling is an important objective for the
Company.
For further information, please visit www.capitalmetals.com or
contact:
Capital Metals plc
Michael Frayne (CEO) +44 (0) 20 7317 6800
SPARK Advisory Partners (Nominated
Adviser)
Neil Baldwin / James Keeshan +44 (0) 20 3368 3554
WH Ireland Limited (Joint Broker)
Harry Ansell / Katy Mitchell +44 (0) 20 7220 1666
Brandon Hill Capital Limited
(Joint Broker)
Jonathan Evans / Oliver Stansfield +44 (0) 20 3463 5000
JORC: the JORC Code provides minimum standards for public
reporting to ensure that investors and their advisers have all the
information they would reasonably require for forming a reliable
opinion on the results and estimates being reported. The current
version is dated
THM: Total Heavy Minerals
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