REG - Blencowe Resources - DFS Results Confirms Outstanding Economics

Blencowe ResourcesAnnouncement

01/12/2025 07:00

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RNS Number : 6390J  Blencowe Resources PLC  01 December 2025

01 December 2025
 

Blencowe Resources Plc

("Blencowe" or the "Company")

 

Definitive Feasibility Study Confirms Outstanding Economics for Orom-Cross
Graphite Project

World-class margins, low capex and an expandable production profile underpin
long-term value

 

Blencowe Resources Plc (LSE: BRES) is pleased to announce results of the
recently completed Definitive Feasibility Study ("DFS") for its 100%-owned
Orom-Cross graphite project in Uganda.  The DFS assesses an initial 15 year
Life of Mine ("LOM"); with only ~2% of the deposit drilled, the Company
expects significant Life of Mine extensions as further drilling converts
additional resources to reserves.

The DFS has been managed and signed off by Independent consultants, CPC
Engineering ("CPC"), one of the world's leading graphite technical experts
responsible for feasibility work on tier-one developments such as ASX listed
Syrah Resources' Balama project and ASX listed Black Rock Mining's Mahenge
project.

The DFS showcases Orom-Cross as a Tier-1 graphite project, delivering strong
margins from a low capital base, and incorporating a downstream beneficiation
facility to produce uncoated spheronised purified graphite product ("USPG")
in-country.

Completion of this independent DFS marks the single most important technical
milestone in the Company's history and formally transitions Orom-Cross into
the financing and development phase.

 

DFS Highlights:

·    Net Present Value (NPV10): US$1.087 Billion

·    Internal Rate of Return (IRR10): 96%

·    All in Sustaining Costs (AISC): US$485/t over LOM (lowest quartile
globally)

·    Free Cash Flow: US$2.034 Billion over initial 15 years LOM

·    Average Annual EBITDA: US$230 million per annum over LOM

·    Phase 1 Production ("P1"): Smaller scale, fast-track operation
targeting first production in 1H-2027 (20,000 tpa concentrate with micronised
products)

·    Downstream Value-Add: In-country beneficiation facility to produce
purified graphite.

·    Phase 2 Production ("P2"): Expansion to 70,000 tpa concentrate and
20,000 tpa USPG nearby.

·    Scalability: Long-term pathway to 175,000 tpa concentrates and 80,000
tpa purified products.

·    Offtake: Non-binding offtake agreements already in place for all
planned P1 Production.

·    Lowest Quartile Total Capital Requirement of US$160 million
comprising:

o  US$40 million for P1, delivering up to 20,000 tpa concentrate

o  US$120 million for P2, lifting up to 70,000 tpa concentrate and up to
20,000 tpa USPG

o  Significant contingency included within these capital estimates.

·    All further expansions post-P2 to be funded entirely from internal
cash flow

 

Project Strategy

Orom-Cross will commence with P1 Production, a smaller-scale, fast-track
development delivering up to 20,000tpa of 96% TGC concentrates by 1H-2027.
P1 is designed to be profitable from first production, materially reducing
financial risk.  Offtake agreements covering all planned P1 volumes are
already in place.

With the DFS now complete, the immediate next step is securing the P1 project
financing package, which becomes the Company's primary corporate focus. This
funding package will initiate ordering, construction and commissioning. Once
P1 production begins and product quality is demonstrated at scale the Company
expects additional offtake interest, particularly given the scarcity of new
high-quality graphite projects coming online.

Within two years of P1 commissioning, Blencowe intends to implement P2
Production, expanding mine output up to 70,000tpa of concentrate.  A
downstream beneficiation facility will be built near to Orom-Cross to upgrade
small flake concentrate to 99.95% TGC USPG, initially producing up to
20,000tpa.  This facility will expand in sync with mine scale-up and will
serve as a long-term captive offtaker for Orom-Cross concentrates over life of
mine. This will position Orom-Cross among the few commercial-scale producers
of 99.95% USPG outside of China, and the first in Africa.

Beyond P2 Production, Orom-Cross is expected to expand in stages toward
175,000tpa concentrate and 80,000tpa USPG, funded entirely by internally
generated cash flow and marking a pathway to becoming an industry leading
producer of both concentrates and high-value purified graphite, aligning with
accelerating global demand for ex-China graphite supply.

 

Sales and Marketing

·    Blencowe continues to use leading global graphite sales and marketing
specialists, expanding commercial networks and progressing additional offtake
opportunities.

·    In 2025, 700 tonnes of Orom-Cross raw material was processed and bulk
sample end products were delivered to graphite end users worldwide for
extensive test work and evaluation.

·    Non-binding offtakes covering all P1 volumes will convert to binding
agreements on P1 financing.

·    SAFELOOP (EU Gen3 battery initiative) volumes remains outside the DFS
as the programme remains under development; however, a substantial additional
Tier-1 offtake opportunity will likely emerge from 2028 onwards once SAFELOOP
commercialises.

·    Continued interest from battery, industrial and specialty-materials
sectors reinforces the strategic importance of reliable, high-quality ex-China
graphite supply.

Orom-Cross will continue to scale in line with contracted market demand,
ensuring disciplined and commercially led expansion. Ongoing engagement with a
broad global end-user network remains central to the expansion strategy.

 

Next Steps: Pathway to P1 Funding and First Production

Completion of the DFS provides Blencowe with a fully defined, independently
verified and finance-ready project, marking the transition into the execution
phase of development.

Together with its corporate advisor WaterBorne Capital, the Company is
advancing a financing solution for P1 Production with active engagement
underway with:

·    Development finance institutions (DFIs)

·    Strategic industry partners

·    Institutional investors

·    Government and quasi-government funding bodies

Several promising structures are under evaluation. Blencowe's target is to
secure P1 financing by end-1Q 2026, enabling ordering, shipping and
construction through 2026, and first production targeted for 1H 2027.

Importantly, the Company expects P1 financing to be primarily funded through
non-Blencowe plc equity structures. The combination of strong DFS economics,
low capex, secured offtake and integrated downstream value-add support a
balanced funding package designed to minimise plc equity dilution.

P2 financing is expected to adopt a more
traditional debt-plus-strategic-partner approach. With the DFS complete,
formal engagement will now begin with groups that have shown interest,
including the US Development Finance Corporation (DFC), the African Finance
Corporation (AFC), and other Tier-1 institutions. P2 financing will run in
parallel with P1 execution, supporting a rapid scale-up to commercial
production.

All expansions beyond P2 are expected to be funded entirely from internally
generated cash flow. Blencowe believes that demand for all its products will
rise substantially over the next few years, especially once Orom-Cross is in
production, and the Company needs to prepare for scaled growth.

 

SPG Beneficiation Facility

The downstream graphite beneficiation facility will be constructed near Gulu,
approximately 150 kms from Orom-Cross and adjacent to existing hydropower
infrastructure. The facility will:

·      Process Orom-Cross concentrate into battery-ready 99.95% TGC
USPG.

·      Utilise low-cost, renewable hydroelectricity available through
Ugandan national grid.

·      Produce both high-value USPG and saleable by-products.

·      Expand modularity in line with mine output.

·      Function as a long-term captive offtaker for up to 50% of
Orom-Cross concentrate (small flake concentrate).

This integrated upstream-downstream model positions Blencowe as one of the
very few ex-China suppliers capable of providing high-specification purified
graphite to global battery and industrial markets.

 

 

 

Key Performance Indicators

The following represents the KPIs for Orom-Cross initial operations as
envisaged within the DFS:

 KPI                                     Value        Comments
 Initial Life of Mine                    15 years     Further infill drilling will extend this LOM substantially
 NPV10                                   US$1.087 Bn  Compares favourably to PFS (NPV8 US$482M) including a higher discount rate
                                                      used

                                                      Incorporates both Orom-Cross and downstream beneficiation facility
 IRR10                                   96%          Strong IRR indicates significant returns on capital
 Capital required - P1 Production        US$40M       Initially produce up to 20,000tpa concentrate and micronised products

                                                      Ramp up to 70,000tpa concentrate and up to 20,000tpa USPG

 Capital required - P2 Production        US$120M      Most key infrastructure already at site
 Average Operating cost over LOM (AISC)  US$485/t     Lowest quartile costs in graphite market ensures less dependency on graphite
                                                      prices having to increase for success
 Average Selling price over LOM          US$1,240/t   Average for all concentrates sold from Orom-Cross

                                         US$2,310/t   Average for USPG and waste sold from beneficiation facility
 Average annual production over LOM      97,000tpa    All concentrates from Orom-Cross

                                         56,500tpa    Uncoated spheronised purified graphite (USPG)
 Average EBITDA over LOM                 US$230M pa   High profitability once commercial scale is reached
 Net Free Cash over LOM                  US$2.034 Bn  Significant free cash delivered from full project with mine life likely to
                                                      extend well beyond the initial 15 years

 

Capital Comparison (PFS vs DFS)

Whilst the full capital requirement has risen since the PFS (2022) there are
several important factors to consider in making comparisons:

·    Orom-Cross will have a smaller, lower risk initial phase (P1)
production which was not part of the PFS scope.

·    Orom-Cross will deliver 70,000tpa concentrates by P2 in the DFS,
versus 50,000tpa at startup within the PFS.

·    The DFS includes micronisation plant and equipment which was not part
of the PFS scope.

·    The DFS also incorporates a 20,000tpa downstream beneficiation
facility, compared to zero downstream production in the PFS.

·    Inflation since 2022 has increased capital and operating cost inputs
across the sector.

Despite these factors, Orom-Cross delivers a significantly more profitable
operation for the capital deployed, as demonstrated by the increase in
valuation metrics:

·    NPV10: US$1.087Bn in DFS vs NPV8: US$482M in PFS

·    IRR10 96% in DFs vs 49% in PFS

·    Higher discount rate used in (10% DFS versus 8% PFS)

 

 

Project Benchmarking

Orom-Cross compares extremely favourably with global graphite peers,
demonstrating:

·    Lowest-quartile capital and operating costs.

·    Robust margins and over US$2 billion in free cash flow over initial
15-year mine life.

·    With only ~2% of the licence drilled, substantial additional reserve
growth and life of mine extensions is anticipated as new graphite deposits are
incorporated.

·    Premium product quality supporting strong pricing and long-term
demand.

A further updated JORC resource is anticipated in 1Q 2026, incorporating
results from an additional 192 step-out holes, including new deposits at Iyan
and Beehive.

 

De-Risking

The DFS together with its world class KPIs, materially de-risks Orom-Cross
across technical, financial and commercial dimensions. All capital and
operating assumptions have been generated using current input costs validated
by technical experts CPC Engineering.

Local infrastructure is largely already in place, and preparatory works can
begin immediately following completion of P1 financing.

Non-binding offtake agreements cover all planned P1 Production and these will
transition to binding status post-financing. Additional offtake interest is
expected post-DFS, particularly given the diverse mix of Western and Asian
end-users currently testing Orom-Cross products, including Tier-1 groups such
as US DoW, and the EU SAFELOOP initiative.

The Company's Community Agreement and strong Ugandan Government support
provide a stable local operating platform, and key technical relationships
(AET, TaiDa Graphite, ADT and others) remain in place, while Orom-Cross's
Minerals Security Partnership accreditation continues to support engagement
with strategic funders and offtakers.

As the project advances toward construction, Blencowe will expand its
executive and operational teams to support the transition to P1 production.

 

Market Outlook

Blencowe believes that demand for natural flake graphite, particularly
high-purity anode material such as that produced at Orom-Cross and the SPG
facility, will grow materially over the medium term.  Graphite remains an
essential, non-substitutable component of lithium-ion batteries used for
energy storage and EVs. Supply is forecast to tighten sharply as global
decarbonisation accelerates.

Orom-Cross is exceptionally well positioned as a near-term producer with a
defined development pathway. Once in production, the Project will be highly
leveraged to rising graphite prices, with its low operating costs ensuring
strong margins across a wide range of market conditions. Any future supply
deficits or price increases would further amplify the already robust DFS
economics.

With a diverse network of relationships across Western and Asian markets,
Blencowe intends to prioritise niche and premium applications to maximise
returns - a strategy that will strengthen further as purified USPG output
commences. The Project also benefits from additional drilled but undeveloped
deposits (Beehive and Iyan) that can be rapidly converted to support higher
production if required.

 

Cameron Pearce, Executive Chairman commented:

"I would like the thank the entire Blencowe team and all our associated
consultants for their exceptional work over the past two years to deliver this
outstanding DFS. Achieving such strong NPV and IRR metrics from a relatively
low capital base is a world-class outcome. It is rare to see a project with
such consistently strong fundamentals across scale, cost structure, margins
and downstream potential."

"This Study marks a transformational moment for Blencowe clearly demonstrating
the scale, quality and longevity of Orom-Cross as we move into the financing
and development phase. The DFS confirms Orom-Cross as a Tier-1 graphite
project and our focus now turns to the financing process and delivering first
production as our next major goals."

"With the Project now considerably de-risked, graphite markets improving, and
a clear pathway to become a major ex-China supplier, we believe Blencowe is
exceptionally well positioned for a meaningful re-rating as investors realise
the scale of the opportunity ahead."

 

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)

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 has now
completed a successful Definitive Feasibility Study phase as the first major
step towards initial production.

Orom-Cross presents as a large, shallow open-pitable deposit, with a JORC
Mineral Resource (November 2025) of 26.10Mt @ 5.58% TGC (Total Graphite
Content) and a JORC Mineral Reserve of 23.08Mt @ 5.18%TGC.

This Resource has been defined from only ~2% of the total tenement area which
presents considerable upside potential ahead, with two new deposits recently
drilled at Beehive and Iyan set to add into the Resource in 2026.
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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