TIDMSAV
RNS Number : 6654R
Savannah Resources PLC
13 December 2016
Savannah Resources Plc / Index: AIM / Epic: SAV / Sector:
Mining
13 December 2016
Savannah Resources Plc
Pre-development Programme Underway at Mutamba Project,
Mozambique
Savannah Resources plc (AIM: SAV) ('Savannah' or 'the Company'),
announces that it has commissioned a scoping study and
environmental studies, and that it has a fully operational and
expanded team in place for the Mutamba (mineral sands) Project in
Mozambique being developed by Savannah and Rio Tinto as part of a
consortium agreement (the 'Consortium') (Figure 1). To view the
press release with the illustrative maps, diagrams please use the
following link:
http://www.rns-pdf.londonstockexchange.com/rns/6654R_-2016-12-13.pdf
HIGHLIGHTS:
-- Mineral sands industry expert TZ Minerals International
('TZMI') has been commissioned to conduct a scoping study to
evaluate an initial phase, low capex, long life, dry mining
operation around a potential 200Mt well graded resource
-- Scoping study is expected to take around 4 months to complete
-- Scoping study to focus on large mineralised areas of >5%
THM, identified from Mineral Resource Estimate work conducted at
Mutamba Project (Figure 1)
-- Leading Mozambican environmental consultants ERM and IMPACTO
have been awarded the contracts to conduct environmental studies
for the Mutamba Project North and Chilubane deposit, which are
expected to take 3-4 months to complete
-- An environmental study is a key document which is required
for the lodging of a mining concession for any potential
development
-- Data compilation and a detailed review of the Chilubane
deposit is underway to further understand and evaluate the project
and is expected to take 6-8 weeks to complete
-- In addition to new staff hired, all of Rio Tinto's former
in-country team has been employed by Savannah and integrated into
the in-country team
Savannah's CEO, David Archer said: "Following the release of the
first Mineral Resource Estimate of 3.5 billion tonnes at 3.8% THM
for the Jangamo and Dongane deposits, which was a major milestone
for Savannah and the Company's Consortium partner, Rio Tinto, we
have now turned our attention to pre-development activities to
continue our evaluations and understanding of the Mutamba Project.
This will include a scoping study and environmental studies being
conducted by leading industry consultants TZMI and IMPACTO/ERM
respectively, as well as further exploration work to evaluate the
high-grade zones of THM at the Ravene deposit, which we believe
will further strengthen the Mineral Resource and ultimately
commercial value of the project. We believe that we have a
substantial mineral sands project in Mozambique and are working on
a fast-paced development strategy as we look to establish a low
capex, long life, dry mining operation."
Figure 1. Mutamba Project Location Map - see PDF link
Note 1: * It is important to note that the above table is a
summary of Exploration Targets and the potential quantity and grade
is conceptual in nature, there has been insufficient exploration to
estimate a Mineral Resource and it is uncertain if further
exploration will result in the estimation of a Mineral Resource
Note 2: The Mutamba Project includes the Mutamba Project North
(consisting of Jangamo, Dongane and Ravene deposits) and the
Chilubane deposit is located 180km to the south west of the Mutamba
Project North. The current resource statement includes only the
Jangamo and Dongane deposits.
Figure 2. Mutamba Project North Location Map - see PDF link
Expanded Team Fully Operational
Since the formation of the Mutamba Project additional staff have
been employed and all of Rio Tinto's former in-country team has
been engaged by Savannah. This complements and significantly
augments Savannah's existing in-country capability, the result of
this is that we have developed a team with deep and relevant
experience (geologists, safety personnel, field support staff and
mineral sands laboratory operators).
Scoping Study
Savannah believes that there is an excellent opportunity to
potentially define an initial phase, low capex, long life, dry
mining project of around a 200Mt well graded resource, associated
with a series of reworked coastal dunes. To fully evaluate the
Mutamba Project, the Consortium has engaged leading mineral sands
consultants, TZMI, to conduct the scoping study, which is expected
to take around four months to complete.
TZMI is an independent consulting company established in 1994
and provides insight and expert advice on the mineral sands sector.
TZMI brings together a leading industry team containing technical,
engineering, processing and operational experience, together with a
strategic and commercial competency. TZMI has a wealth of
scoping/feasibility study experience including recent and relevant
experience in the African mineral sands sector.
The scoping study will take specific project characteristics
(location, infrastructure, geology) into account leveraging off
work previously undertaken to increase the level of detail of the
operating and capital cost estimates to that of a scoping study,
for the purposes of completing an economic evaluation.
Consideration will also be given to the product mix and potential
to supply ilmenite.
Concepts for infrastructure will be drawn from TZMI's experience
and location specific information provided by Savannah. As part of
the process TZMI will determine scoping level operating and capital
cost estimates. A cash flow model will be developed, the output of
which will be used to define the key project metrics.
Recommendations for further project development will also be
included and an outline provided suggesting work to be undertaken
in subsequent phases of the Project development.
Environmental Studies
To obtain a mining concession in Mozambique an environmental
study of a mining project must be lodged with an application for a
mining concession. The scope of work for such a study covers the
full procedural requirements for lodging an application for a
mining concession. To fast track this pre-development work the
Consortium has decided to split the work into two blocks and has
engaged leading Mozambique consulting companies ERM (Mutamba
Project North - Dongane, Jangamo and Ravene deposits) and IMPACTO
(Chilubane deposit) to conduct this work.
IMPACTO is the benchmark company in the field of environmental
consulting in Mozambique, it is based in Maputo and has been
established in the market for 20 years. IMPACTO has highly
qualified environmental and social consultants with extensive
experience in carrying out a wide range of environmental and social
studies in Mozambique including, inter alia, Environmental and
Social Impact Assessments, preparation of Environmental and Social
Management Plans (i.e. subsidiary plans, including Communication
Plans and Grievance Procedures, Waste Management Plans,
Environmental and Social Monitoring Plans) and Resettlement Action
Plans.
ERM is a leading sustainability consulting company, advising
governments and business worldwide on environmental, health,
safety, risk, and social issues. ERM employs around 5,000 highly
trained professional and technical staff in all sectors of
sustainability-related work. ERM has over 160 offices in 40
countries worldwide, and has completed projects across the world.
ERM has been involved in environmental and social management
projects in Mozambique since the early 1990s, including
Environmental and Social Impact Assessments for oil & gas and
mining developments across Mozambique.
Chilubane Geological Information Review
A detailed data set for the Chilubane deposit has now been
received from Rio Tinto and a review and evaluation of this
information is now underway, which is expected to take 6-8 weeks to
complete.
Competent Person
The information in this document that relates to exploration
results is based upon information compiled by Mr Dale Ferguson,
Technical Director of Savannah Resources Limited. Mr Ferguson is a
Member of the Australian Institute of Mining and Metallurgy
(AusIMM) and has sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration and
to the activity which he is undertaking to qualify as a Competent
Person as defined in the December 2012 edition of the "Australasian
Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves" (JORC Code). Mr Ferguson consents to the inclusion in
the report of the matters based upon the information in the form
and context in which it appears.
The information in this document that relates to the resource
estimation is based upon information compiled by Mr Colin Rothnie,
an independent consultant. Mr Rothnie is a Member of the Australian
Institute of Mining and Metallurgy (AusIMM) and has sufficient
experience which is relevant to the style of mineralisation and
type of deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined in the
December 2012 edition of the "Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves" (JORC
Code). Mr Rothnie consents to the inclusion in the report of the
matters based upon the information in the form and context in which
it appears.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
**S**
For further information please visit www.savannahresources.com
or contact:
David Archer Savannah Resources Tel: +44 20
plc 7117 2489
David Hignell / Gerry Northland Capital Tel: +44 20
Beaney (Nominated Partners Ltd 3861 6625
Adviser)
Jon Belliss / Elliot Beaufort Securities Tel: +44 20
Hance Ltd 7382 8300
(Corporate Broker)
Charlotte Page / St Brides Partners Tel: +44 20
Lottie Brocklehurst Ltd 7236 1177
Notes
Savannah Resources Plc (AIM: SAV) is a growth oriented,
multi-commodity, development company.
Mozambique
Savannah operates the Mutamba heavy mineral sands project in
Mozambique in collaboration with Rio Tinto, and can earn a 51%
interest in the related Consortium, which has an established
initial Indicated and Inferred Mineral Resource Estimate of 3.5
billion tonnes at 3.8% THM over the Jangamo and Dongane deposits.
Under the terms of the Consortium Agreement with Rio Tinto,
Savannah must deliver the following to earn corresponding interest
in the Mutamba Project: scoping study - 20%; pre-feasibility study
- 35%; feasibility study - 51%. Additionally, the Consortium
Agreement includes an offtake agreement on commercial terms for the
sale of 100% of production to Rio Tinto (or an affiliate).
Oman
Savannah has interests in two copper blocks in the highly
prospective Semail Ophiolite Belt in Oman. The projects, which have
an Indicated and Inferred Mineral Resource of 1.7Mt @ 2.2% copper
and high-grade intercepts of up to 56.35m at 6.21% Cu, with gold
credits, provide Savannah with an excellent opportunity to
potentially evolve into a mid-tier copper and gold producer in a
relatively short time frame. Together with its Omani partners,
Savannah aims to outline further mineral resources to provide the
critical mass for a central operating plant to develop the
deposits, and in December 2015 outlined exploration targets of
between 10,700,000 and 29,250,000 tonnes grading between 1.4% and
2.4% copper.
Finland
Savannah has Reservation Permits over two new lithium projects,
Somero and Erajarvi, covering an area of 159km(2) in Finland.
Savannah holds a 100% interest in these projects through its
Finnish subsidiary Finkallio Oy. Geological mapping by the Finnish
Government within the project areas has highlighted the presence of
lithium minerals spodumene, lepidolite and petalite with the
Government also identifying Somero and Erajarvi as one of the most
prospective areas to discover lithium deposits in Finland. Savannah
plans to initiate an exploration programme including data
compilation, geological mapping and surface sampling with the aim
of generating drill ready targets during 2016.
This information is provided by RNS
The company news service from the London Stock Exchange
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