REG - Jangada Mines PLC - Investee Company Update: Blencowe Resources PLC

Jangada MinesAnnouncement

28/04/2023 07:00

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RNS Number : 7849X  Jangada Mines PLC  28 April 2023

 

Jangada Mines plc / EPIC: JAN.L / Market: AIM / Sector: Mining

 

Jangada Mines plc ('Jangada')

 

Investee Company Update: Blencowe Resources PLC

 

Jangada Mines plc is pleased to note the announcement released by Blencowe
Resources PLC (LON:BRES) in which it holds a c. 9.5% interest. The
announcement is set out below without material changes. 

 

Start of Blencowe Resources PLC announcement

 

Date: 27 April 2023

 

Blencowe Resources Plc

("Blencowe" or the "Company")

 

Strategic Funding Partner for Orom-Cross Graphite Project

 

Development Finance Corporation ("DFC") engaged to fund 50% of Project
Definitive Feasibility Study ("DFS") costs by way of a Technical Assistance
Grant

 

Highlights

·    Blencowe passes key hurdle for engagement with US project development
financial institution, the DFC.

·    US International Development Finance Corporation is America's leading
development finance institution that partners with the private sector to
provide finance solutions for project development in markets deemed as
critical.

·    DFC geared to provide funding assistance for Orom-Cross as part of
the US Government's strategic drive for further access to critical minerals
and metals, within its wider renewables strategy.

·    Orom-Cross has successfully passed through the key Project Screening
test within DFC, with both Parties now moving to a binding Grant Agreement.

·    Blencowe is seeking up to US$4.5 million as a Technical Assistance
Grant ("TAG") for Definitive Feasibility Study costs for the Orom-Cross
Graphite Project.

·    As part of the Grant Agreement DFC will require a right of first
refusal ("ROFR") on debt finance for the full project implementation, which
would give Blencowe a potential funding solution ahead with a major financial
institution.

 

 

 

Blencowe Resources Plc is pleased to announce it has passed the key Screening
hurdle within the DFC in order to move forward to secure a substantial
Technical Assistance Grant.

 

The process now moves to a Grant Agreement and other final requirements to
complete this funding solution.  The TAG under consideration for Orom-Cross
is up to US$4.5M for costs associated with the Definitive Feasibility Study
and the terms are considered advantageous to Blencowe as any repayment would
only occur if and when the project goes into production at a future date.
The TAG provides for DFC to pay 50% of agreed costs within the Orom-Cross DFS,
with Blencowe to provide the remainder.

 

Once consummated this relationship could also provide Orom-Cross with a
potential project funding solution as the TAG will require a ROFR for debt on
commercial terms for full project implementation.  Debt funding to build a
mining operation remains one of the principal challenges for all graphite
projects hence this ROFR would further de-risk Orom-Cross by adding an
internationally respected tier one financial institution as a key project
supporter for this funding ahead.

 

About International Development Finance Corporation

The DFC is the primary US Government finance institution set up to provide
financially sound funding solutions for private-sector initiatives pertaining
to critical challenges facing the world, in this case the drive towards
increased sustainability across the planet.  It is an agency of the United
States federal government and represents US interests.

 

DFC's lending capacity is used to provide loans, guarantees, equity
investments and political-risk insurance for private-sector led development
projects, feasibility studies and technical assistance.  DFC invests across
several sectors with stated goals of empowerment, innovation, investment into
Africa and climate change.

 

Orom-Cross is directly linked with several of these goals.  It may ultimately
become one of the largest graphite producing operations in the world, over a
very long mine life, delivering a concentrate as end-product which is a
non-replaceable input component to batteries.  These batteries provide the
means to store energy across many different renewable energy applications as
well as to replace vehicles powered by fossil fuels with electric vehicles
("EVs"). Electric vehicles are powered by lithium-ion batteries which have
more graphite within them than any other metal (up to 70kgs graphite per
battery) and EV demand is accelerating at a rate where it is doubling every
few years, and expected to continue exponentially into the future.  Graphite
is therefore high on the US Government critical metals and minerals list and
securing long term supply of graphite is a key strategy.

 

Orom-Cross will also deliver a greener graphite product than many other
producers through a variety of production initiatives, including the use of
hydro-power for all mining and processing energy requirements.  Orom-Cross
aims to become one of the leading sustainable mining projects worldwide and
this is considered very important in a rapidly changing landscape where every
participant along the EV supply chain will be audited on their sustainability
credentials by OEMs.

 

Cameron Pearce, Blencowe's Executive Chairman commented;

 

""This milestone represents a significant step forward in the development of
Orom-Cross. We have now further de-risked the Project by introducing a high
quality funding partner that will ultimately cover a substantial portion of
the costs to complete the DFS.

 

This same partner is a highly respected international financial institution
that may also deliver a debt funding solution for the construction of the
plant and associated infrastructure once we move into the implementation
stage, which adds another dimension altogether.  We are therefore covering
several important bases here to provide an all-encompassing funding solution
to ensure that we can successfully bring Orom-Cross into production over the
medium term once we have completed our final feasibility studies. By doing
this as a Technical Assistance Grant Blencowe is importantly retaining 100%
ownership in the Orom-Cross Project as we believe the completion of the DFS
will add significant additional value ahead, which we want to retain in full
for our shareholders.

 

DFC is a tremendous partner for Blencowe given its considerable experience
assisting private-sector companies through project development stage and into
production.  DFC has experience of both the continent and the country we are
operating within, as well as expertise dealing with Governments and other
stakeholders. All parties understand the tremendous value that Orom-Cross
presents going forward within a rapidly accelerating renewable energy market,
and more specifically a rampant lithium-ion battery EV market."

 

End of Blencowe Resources PLC announcement

 

**ENDS**

 

For further information please visit www.jangadamines.com
(http://www.jangadamines.com/)  or contact:

 

 Jangada Mines plc                     Brian McMaster (Chairman)  Tel: +44 (0)20 7317 6629
 Strand Hanson Limited                 Ritchie Balmer             Tel: +44 (0)20 7409 3494

 (Nominated & Financial Adviser)       James Spinney

 Tavira Securities Limited             Jonathan Evans             Tel: +44 (0)20 7100 5100

 (Broker)

 St Brides Partners Ltd                Ana Ribeiro                jangada@stbridespartners.co.uk

 (Financial PR)                        Isabel de Salis

 

 

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