REG - Blencowe Resources - DFC LOI Regarding Project Financing

Blencowe ResourcesAnnouncement

29/01/2024 07:00

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RNS Number : 1918B  Blencowe Resources PLC  29 January 2024

Date: 29 January 2024
Blencowe Resources Plc

 
     ("Blencowe" or the "Company")

 

 

US International Development Finance Corporation provides Letter of Interest
for Orom-Cross project financing

DFC lead mandated partner for Orom-Cross project funding

 

Blencowe Resources Plc (LSE: BRES) is pleased to announce it has received a
formal Letter of Interest ("LOI") from the US International Development
Finance Corporation ("DFC") in which the DFC has indicated its willingness to
participate in debt funding for the Orom-Cross graphite project ("Orom-Cross
or the "Project") in Uganda, subject to all necessary due diligence.  This
comes following recent discussions with DFC project funding division and
follows the 2023 agreement with the DFC's technical assistance division, who
have already entered into a US$5 million Technical Assistance Grant ("TAG").

To date US$2 million of grant funds have been received from the DFC under the
TAG, with the balance expected during the course of 2024 as certain milestones
are met. The TAG also provided for the DFC to have the right to be mandated to
directly provide (and/or arrange for) financing or investment for the Project
on commercial terms.

This LOI is the first step of engagement with the DFC project funding division
to advance the project financing process.  During the course of 2024 Blencowe
will work closely with the DFC to reach a decision to mine subject to the DFS
results and other due diligence.  Graphite is high on the US Government
critical metals and minerals list and their strategy is to open up long term
supply chains of graphite.  Demand for graphite is accelerating fast and is
expected to continue growing into the future due mainly to its non-replaceable
role within the lithium-ion battery that stores energy.

The Company is seeking to position Orom-Cross to deliver a 'green' graphite
product through a variety of production initiatives, including the use of
hydro-electric power for all mining and processing energy requirements.
Orom-Cross aims to become one of the leading sustainable mining projects
worldwide and this is a very important component of the DFC charter and
critical within a rapidly changing landscape where every participant along the
EV supply chain is being audited on their sustainability credentials by
Original Equipment Manufacturers (OEMs).

Orom-Cross's potential ability to aid in the further development of the
Ugandan economy, empowering its population and driving investment and future
development has also proved attractive to the DFC.

 

Cameron Pearce, Executive Chairman commented;

"This Letter of Interest is an important next-step in the process for DFC to
consider project financing support to build Orom-Cross into a producing
mine.  Project funding will be crucial for the Company this year as we work
to conclude the DFS and this engagement with the DFC continues to underpin our
long-term relationship with the DFC, as lead mandated partner, to assist in
this exercise."

 

Mr Pearce added "Our executive management team will be meeting DFC in the near
term to evaluate the project implementation strategy and build on the momentum
we have already created together.  We believe this is a unique partnership
that is significantly de-risking Orom-Cross and we will continue to showcase
this exceptional asset as we deliver the DFS results this year.

 

For further information please contact:

 

   Blencowe Resources Plc    www.blencoweresourcesplc.com

 Sam Quinn                   Tel: +44 (0)1624 681 250

                             info@blencoweresourcesplc.com (mailto:info@blencoweresourcesplc.com)

 Investor Relations          Tel: +44 (0) 7891 677 441

 Sasha Sethi                 sasha@flowcomms.com (mailto:sasha@flowcomms.com)

 Tavira Financial            Tel: +44 (0)20 3192 1733

 Jonathan Evans              jonathan.evans@tavira.group (mailto:jonathan.evans@tavira.group)

 First Equity Limited        Tel: +44(0)20 7330 1833

 Jason Robertson             jasonrobertson@firstequitylimited.com
                             (mailto:jasonrobertson@firstequitylimited.com)

Twitter https://twitter.com/BlencoweRes (https://twitter.com/BlencoweRes)

LinkedIn https://www.linkedin.com/company/72382491/admin/
(https://www.linkedin.com/company/72382491/admin/)

 

 

 

Background

Orom-Cross Graphite Project

Orom-Cross is a potential world class graphite project both by size and
end-product quality, with a high component of more valuable larger coarse
flakes within the deposit.

A 21-year Mining Licence for the project was issued by the Ugandan Government
in 2019 following extensive historical work on the deposit.  Blencowe
completed a successful Pre-Feasibility Study on the Project in July 2022 and
is now within the Definitive Feasibility Study phase as it drives towards
first production.

Orom-Cross presents as a large, shallow open-pitable deposit, with an initial
JORC Indicated & Inferred Mineral Resource of 24.5Mt @ 6.0% TGC (Total
Graphite Content). This Resource has been defined from only ~2% of the total
tenement area which presents considerable upside potential ahead.
Development of the resource is expected to benefit from a low strip ratio and
free dig operations together with abundant inexpensive hydro-electric power
off the national grid, thereby ensuring low operating costs.  With all major
infrastructure available at or near to site the capital costs will also be
relatively low in comparison to most graphite peers.

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