RCS - Amala Foods PLC - Rare Earth Elements Market Opportunity

Amala FoodsAnnouncement

10/03/2022 07:15

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RNS Number : 3263E  Amala Foods PLC  10 March 2022

 

Amala Foods Plc

("Amala" or the "Company")

 

Rare Earth Elements Market Opportunity

 

Amala Foods Plc (LON: DISH) is pleased to announce further information
regarding the Rare Earth Elements (REE) market opportunity that was first
announced on 17 February 2022.

The current geopolitical turmoil and rising energy prices are likely to result
in western economies accelerating the shift towards the "green economy" as
they continue to seek to reduce their reliance on fossil fuels.  The
electrification of the energy used to drive machinery is a key part of the
energy transition and one of the most significant energy shifts in history.
Magnet metals are central to this transition and critical to manufacturing
applications such as electric vehicles and wind turbines.  Provenance of
critical rare earth materials will become significant factors in supply
chains.  Prices of Praseodymium-Neodymium Oxide (NdPr) continue to rise
driven by burgeoning demand and growing shortage of supply in China.

Terra Rara UK Ltd and Terras Raras De Angola Limitada, its Angolan subsidiary,
have a team of geologists on the ground who are progressing the REE
projects.  The historical grades from diamond drilling of Total Rare Earth
Oxides (TREO) were announced on 17 February 2022 and these very high-grade
drill intersections demonstrate the prospectivity of the project.  The Mungo
Rare Earth Elements project is located approximately 150 kilometers from
Pensana Plc's Longonjo Project.

The work on this project will include additional soil geochemistry, ground
truthing previous diamond drilling allowing for the planning of the next phase
of RC and Diamond drilling, and the establishment of the camp and
infrastructure required to support the next phase of drilling. A 5,000 metre
Reverse Circulation and Diamond Drill campaign will then follow and will be
designed to move the project toward an initial mineral resource estimate.

An important aspect for a project such as Mungo is access to infrastructure,
and as with the Pensana Longonjo project, Mungo is well placed being close to
world class rail, port and power infrastructure. The Benguela Railway line
lies less than 100 kilometres from the project and runs to Lobito Port, one of
the largest and most modern ports on the West coast of Africa. The project
also lies within 50 kilometres of the north Angola Hydro power interconnection
which means that the project will have access to renewable energy. The Gove
and Ruacana Hydropower stations lie approximately 250 kilometres south of the
project.

The high-grade results from the drilling to date on the Mungo project combined
with access to world class infrastructure mean that Mungo has the potential to
become a low capex and low opex REE project.

In Uganda, through Terra Rara Uganda Limited, the in-country work program over
the next 12 months will focus on soil geochemistry over areas identified by
aeromag survey. The soil geochemistry results will provide drill targets for
the next phase of work.

The Company will update the market as progress continues towards the execution
of a Sale and Purchase Agreement (SPA).  Whilst the Directors are optimistic
that the transaction will conclude, there however can be no guarantees.

 

Gerard Kisbey Green, Executive Director of Tera Rara UK, commented:

 

"Having access to high quality exploration data that was carried out by a Tier
1 mining company is a great start to a project. The analysis of this
exploration data shows high-grade results in all the holes drilled and assayed
to date and then when you consider that Mungo has close access to world class
Rail, Port and Power we are confident albeit early in the project that Mungo
has the potential to become a significant REE project"

 

Aidan Bishop, Director, Amala Foods Plc, commented:

 

"Since the previous announcement on 2 March 2022 there have been further
expressions of interests to provide finance to bring this transaction to a
successful conclusion.  I am pleased with the progress being made on this
potential transaction that if successful will result in a complete
transformation for the Company.  The Company announced previously that based
on the current number of outstanding shares, if successful, the transaction
would result in a 'see through' valuation of approximately 2p per share."

 

 

Enquiries:

 

Jonathan Morley-Kirk, Non-Executive Chairman

jmk@bigdish.com (mailto:jmk@bigdish.com)

 

 

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