REG - Andrada Mining Ltd - Operational update for the period ended 29/02/24

Andrada MiningAnnouncement

27/03/2024 07:00

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RNS Number : 4830I  Andrada Mining Limited  27 March 2024

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 (MAR) as in force in the United Kingdom pursuant to the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement via Regulatory Information Service (RIS), this inside information
will be in the public domain.

Andrada Mining Limited

("Andrada" or the "Company")

Operational update for the period ended 29 February 2024.

54% increase in tin concentrate production to 1 474 tonnes.

Andrada Mining Limited (AIM: ATM, OTCQB: ATMTF), the African technology metals
mining company with a portfolio of mining and exploration assets in Namibia,
hereby provides an unaudited operational update for the 12 months ended 29
February 2024 ("FY2024").

HIGHLIGHTS
Operations

§ 60% year-on-year ("YoY") increase in ore processed to 915 599 tonnes
(FY2023: 573 818 tonnes).

§ 54% YoY increase in tin concentrate production to 1 474 tonnes (FY2023:
960 tonnes).

§ 51% YoY increase in contained tin production to 885 tonnes (FY2023: 587
tonnes).

§ Plant availability increased to 91% in FY2024 (FY2023: 87%).

§ Tin recovery increased to 72% in FY2024 (FY2023: 69%).

§ Production of five tonnes of saleable tantalum concentrate.

§ Production of 40 tonnes saleable lithium concentrate.

Financial

§ Average C1¹ operating cash cost compared to management guidance of between
                                    USD 17 000 and USD 20
000 per tonne of contained tin:

-    FY2024 at USD 17 640 was within guidance.

-    14% decrease in C1 costs quarter-on-quarter ("QoQ").

§ Average C2² operating cash cost compared to management guidance of between
                               USD 20 000 and USD 25 000 per
tonne of contained tin:

-    FY2024 at USD 20 173 was within guidance.

-    12% decrease in C2 QoQ.

§ All-in sustaining cost ("AISC") compared to management guidance of
between                                     USD 25 000 and
USD 30 000 per tonne of contained tin:

-    FY2024 at USD 26 223 was within guidance.

-    13% decrease in AISC QoQ.

§ The Company will provide updated guidance in the Q1FY2025 operational
update.

§ Unaudited cash balance on 29 February 2024 of GBP 17.5 million (USD 22.2
million).

Strategic Process
§ Indicative, non-binding offers received for a partnership interest at the project level.
§ Discussions with potential partners are progressing well.
Anthony Viljoen, Chief Executive Officer, commented:

"It pleases me that the strategic operational initiatives that we embarked on
have been successful and yielded the further double-digit percentage increases
in production tonnage at our operations that we are presenting today. Although
the higher stripping resulted in an increase in the AISC during the year, the
exposure of the orebody's grade, diversity of minerals including lithium, and
scale at depth according to our geological model, will start to become
glaringly apparent placing the operations in a robust position to capitalise
on the rebound in the commodities markets for all our products."

OPERATIONAL review
Table 1: Uis Mine unaudited TIN production and cost performance

 Feed grade                    % Sn                 0.151    0.161    0.141    0.137    0.148    0.148    0%    -3%
 Plant processing rate         tonnes per hour      135      138      138      137      137      106      29%   -1%
 Ore processed                 tonnes               217 189  232 154  228 234  238 022  915 599  573 818  60%   4%
 Tin concentrate               tonnes               359      398      346      371      1 474    960      54%   7%
 Contained tin                 tonnes               216      238      202      231      885      587      51%   14%
 Tin recovery*                 %                    70       67       66       72       69       68       1%    9%
 Plant availability            %                    91       92       89       89       91       87       5%    0%
 Plant utilisation             %                    79       83       86       89       84       66       27%   4%
 Uis mine C1 operating cost¹   USD/t contained tin  15 741   19 560   18 917   16 273   17 640   19 762   -11%  -14%
 Uis mine C2 operating cost²   USD/t contained tin  18 235   22 252   21 386   18 775   20 173   22 287   -9%   -12%
 Uis mine AISC³                USD/t contained tin  21 377   26 671   30 452   26 616   26 223   24 939   5%    -13%
 Tin price achieved            USD/t contained tin  25 149   25 183   24 749   26 125   25 593   25 051   2%    6%

 

C1¹ refers to operating cash cost per unit of production excluding selling
expenses and sustaining capital expenditure associated with Uis Mine.

C2² operating cash cost is C1 plus selling expenses including logistics,
smelting and royalties.

All-in sustaining cost³ incorporates all costs related to sustaining
production; capital expenditure associated with developing and maintaining the
Uis operation as well as pre-stripping waste mining costs.

*Tin recovery includes stockpiles.

TIN
Review of performance

Ore processed increased by 60% to 915 599 tonnes and the plant processing
rate increased by 29% YoY to 137tph, all due to the plant expansion in FY2023
and the preliminary impact of the Continuous Improvement 2 programme ("CI2").
Annual tin concentrate production increased by 54% to 1 474 tonnes (FY2023:
960 tonnes) resulting in a 51% increase in contained tin to 885 tonnes
(FY2023: 587 tonnes) YoY.

Contained tin tonnage produced in Q4 increased by 14%, a higher rate than the
7% increase in tin concentrate, due to tantalum concentrate separation. The
extraction of tantalum resulted in an increase in tin concentrate grade by 16%
between December 2023 and February 2024.

Production expansion plan

The Company is implementing a production expansion project at the existing tin
processing plant to 2 600 tpa (or 1 600 tpa of tin metal) in line with the
Orion tin royalty requirements. The production expansion will be facilitated
through the installation of a pre-concentration circuit that incorporates
ore-sorters.

The net effect of the ore-sorters is expected to be an increase of
approximately 50% in the tin content to the wet processing plant. The CI2 will
augment the pre-concentration circuit, enabling plant production to reach the
targeted run-rate by April 2025. Commissioning of the pre-concentration
circuit is planned for the first quarter of 2025. This expansion is
anticipated to increase revenue by up to 75% and to reduce the AISC. (See
announcement dated 12 March 2024).

TANTALUM

Optimisation of the circuit has been completed, and 7.4 tonnes of tantalum
concentrate were produced during Q4. The current concentrate production rate
is 48tpa and is expected to increase to approximately 83tpa after
implementation of the ore-sorting facility. The Company is on track to supply
tantalum to AfriMet on a quarterly basis, commencing March 2024. The revenue
from the tantalum concentrate is anticipated to increase total group revenue
by between 3% and 5%. (See announcement dated 12 March 2024).

LITHIUM
Lithium Pilot Plant

Approximately 40 tonnes of saleable, technical-grade lithium concentrate was
produced and stockpiled by the end of the reporting period. The production
rate is expected to increase to 100 tonnes per month by the end of March 2024.
Internal test work confirms that this technical-grade material meets the
specifications for the glass-ceramics market, and Andrada is exploring
additional offtake agreements with both industrial and battery chemical
markets.

FINANCial

All unit costs were at the lower level of management guidance for the full
year. Furthermore, all the costs decreased by double digit percentage points
in Q4 due to higher tonnages and enhanced efficiencies as the Company
implements the CI2 programme. AISC declined from USD30 452 per tonne in Q3 to
USD26 616 in Q4, mainly due to the decrease in the stripping ratio from 4.51
at the end of November 2023 to 3.21 at the end of February 2024. The unaudited
cash balance on 29 February 2024 was GBP 17.5million (USD 22.2 million).

STRATEGIC PROCESS

Since the launch of the Strategic Process to identify an appropriate partner
for the lithium development, leading international organisations within the
lithium value chain have visited the Company's assets in Namibia, have
conducted mineralogical test work, and have implemented detailed due
diligence. Andrada has narrowed down the various non-binding indicative offers
that have been received to date and discussions are ongoing with the objective
of progressing to final binding bids.

The Company is encouraged by the keen interest that has been shown and will
work expeditiously to make a value-accretive decision for its shareholders.
The Company will keep the market updated as matters progress.

 Glossary of abbreviations
 AISC  All In Sustaining Cost
 CY    Calendar year for the 12 months ending December
 CI2   Continuous Improvement 2 programme
 FY    Financial year for the 12 months ending March
 GBP   British pound sterling
 NAD   Namibian dollar
 Q3    Third quarter ending November
 Q4    Fourth quarter ending February
 USD   United States dollar

 
 
 CONTACT
 ANDRADA MINING LIMITED
 Anthony Viljoen, CEO                 +27 (11) 268 6555

 Sakhile Ndlovu, Investor Relations   investorrelations@andradamining.com

 NOMINATED ADVISOR
 WH Ireland Limited                   +44 (0) 207 220 1666

 Katy Mitchell

 CORPORATE BROKER & ADVISOR
 H&P Advisory Limited                 +44 (0) 20 7907 8500

 Andrew Chubb

 Jay Ashfield

 Matt Hasson

 Berenberg                            +44 (0) 20 3753 3040

 Jennifer Lee

 Natasha Ninkov

 WHI Capital Markets                  +44 (0) 20 7220 1670

 Harry Ansell

 FINANCIAL PUBLIC RELATIONS
 Tavistock (United Kingdom)           +44 (0) 207 920 3150

 Jos Simson                           andrada@tavistock.co.uk

 Catherine Drummond

 Adam Baynes

 

About Andrada Mining Limited

Andrada Mining Limited, formerly Afritin Mining Limited, is a London-listed
technology metals mining company with a vision to create a portfolio of
globally significant, conflict-free, production and exploration assets. The
Company's flagship asset is the Uis Mine in Namibia, formerly the world's
largest hard-rock open cast tin mine.

 

An exploration drilling programme is currently underway with the aim of
expanding the tin resource over the fourteen additional, historically mined
pegmatites that occur within a 5 km radius of the current processing plant.
The Company has set a mineral resource target of 200 Mt to be delineated
within the next 5 years. The existing mine, together with its substantial
mineral resource potential, allows the Company to consider economies of scale.

 

Andrada is managed by a board of directors with broad industry knowledge and a
management team with extensive commercial and technical skills. Furthermore,
the Company is committed to the sustainable development of its operations and
the growth of its business. This is demonstrated by the way the leadership
team places significant emphasis on creating value for the wider community,
investors, and other key stakeholders. Andrada has established an
environmental, social and governance system that has been implemented at all
levels of the Company and aligns with international standards.

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