REG - Kodal Minerals PLC - Bougouni Drilling Results & Sale of Bougouni West

Kodal MineralsAnnouncement

19/04/2023 08:45

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230419:nRSS7346Wa&default-theme=true

RNS Number : 7346W  Kodal Minerals PLC  19 April 2023

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (596/2014/EU) as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018.

Kodal Minerals Plc / Index: AIM / Epic: KOD / Sector: Mining

 

19 April 2023

Kodal Minerals plc

("Kodal Minerals", "Kodal" or the "Company")

 

Bougouni Lithium Project drilling results - High-Grade Intersections at Boumou
Prospect; and

Sale of Bougouni West Project

 

Kodal Minerals, the mineral exploration and development company, is pleased to
provide an update on the initial drilling results received for recent reverse
circulation ("RC") drilling completed at the Boumou Prospect located within
the Company's Bougouni Lithium Project in Mali. In addition, the Company
announces details of the agreements for the sale of the Bougouni West
concessions for a total cash consideration for Kodal of £2.0 million and
confirmation of the immediate transfer and sale of the Mafélé Ouest
concession.

 

Highlights:

·    Initial RC drilling assay results for the Boumou prospect confirm
wide, high grade extensions of the prospect.

·    Intersections confirmed are the widest returned to date at Boumou at
up to 51m width and the highest grade intersections with grades up to 3.27%
Li(2)O returned for individual samples and significant intersections
including:

o  36m at 1.29% Li(2)O from 93m, including 13m at 1.96% Li(2)O from 100m in
drill hole KLRC197; and

o  51m at 1.08% Li(2)O from 78m, including 9m at 1.77% Li(2)O from 112m  in
drill hole KLRC198 and 31m at 1.23% Li(2)O from 42m in drill hole KLRC199.

·    These initial drill results confirm an extension of the Boumou
prospect for over 250m to the west, and geological mapping indicates potential
for over 700m of additional strike length to be added with the identification
of pegmatite material along strike.

·    With the Company's focus on its Bougouni Project and this further
confirmation of its potential, Kodal has reached agreement to sell its
Bougouni West concessions which do not form part of the main Bougouni Project
to ASX listed Leo Lithium Ltd ("Leo Lithium") for a total cash consideration
of £2.5 million subject to all agreements being executed, with Kodal to
receive £2.0 million and the original concession holder Bambara Resources
SARL ("Bambara") to receive £0.5 million.

 

Bernard Aylward, CEO of Kodal Minerals, remarked: "The wide, high grade
intersections returned for the Boumou prospect confirm our confidence that the
Bougouni Project will continue to deliver significant new zones of pegmatite
hosted mineralisation and provide confidence for the extension of the mine
life at Bougouni.  These new intersections are the widest and highest grade
so far returned from Boumou, and the geological reconnaissance identifying
further extension of strike length point to Boumou developing into a
significant prospect. Given the quality of these results, it is likely that
the Boumou prospect will be the focus of our further exploration drilling
programme which is expected to recommence in early May when all assay results
have been received.

 

"Kodal's drilling campaign has returned exciting results at Ngoualana, Kola
and Boumou to date with further assays pending for the Bougouni South, Boumou
and Ngoualana prospects.  These final results are keenly awaited as
geological logging of drillholes has highlighted the presences of wide
pegmatite zones.

 

"The sale of the Bougouni West concessions is a direct result of our focus on
the upside potential at our Bougouni Project, highlighted by these recent
outstanding intersections at Boumou and the Company's priority on providing a
long life resource base for the mining operation that we are developing with
our partner Hainan Mining Ltd.  Kodal believes that the best return for our
exploration expenditure will be in the Bougouni Project, however, our
agreement with Leo Lithium means we retain exposure to any exploration upside
at Bougouni West and that the necessary work will be completed with a greater
focus than could be justified by Kodal."

 

FURTHER INFORMATION

Boumou Prospect

At the Boumou prospect 7 RC drill holes for a total of 1,344m were completed
in the March drilling campaign.  The drilling targeted extensions to the west
of the defined resource zone and geological logging of the drilling indicated
multiple pegmatite bodies intersected with a maximum individual width of 49m
continuous pegmatite, and cumulative downhole pegmatite intersections up to
67m in drill hole KLRC198.

 

Initial assay results have been received for three drillholes and confirm the
presence of wide, high grade lithium mineralisation with significant results
including:

 

 Hole_ID  Northing  Easting  RL   Dip/Azi  Depth   From  To    Width  Grade Li(2)O
 KLRC197  1255613   655082   330  -50/000  162     72    81    9      1.26
                                                   93    129   36     1.29

                                           Incl.   100   113   13     1.96

 KLRC198  1255543   655082   330  -50/000  174     78    129   51     1.08
                                           Incl    112   121   9      1.77

                                                   137   146   9      1.24

 KLRC199  1255473   655052   330  -50/000  210     42    73    31     1.23

Notes:  Drill holes are RC drill holes.  Drill holes have been sampled on a
1.0m basis with samples collected via a riffle split system. Drill hole
collars are surveyed using a differential GPS with sub 1-metre accuracy,
coordinate system WGS84 - Zone 29N, and all holes are surveyed down-hole for
dip and azimuth on approximately 30m intervals. All drill holes are
geologically logged, and sampling for analysis is based on geological
boundaries.  Samples analysed by ALS Global. Assay results are reported as
Li% and converted to Li(2)O% by a factor of 2.153.  Intersections are
reported using geological boundaries for logged pegmatite, with a nominal
0.5%Li(2)O lower-cut-off and allowing for a maximum of 2m internal dilution.

 

The Boumou prospect has a current Inferred Resource that remains open along
strike, and this recent phase of drilling indicates a potential strike length
exceeding 750m and up to 1km, providing potential for significant growth in
the Boumou prospect defined resource.

 

Full assessment of the prospect will be completed when assay results are
returned, and further drilling can be planned.

 

Sale of Bougouni West Project

The Bougouni West Project comprises two concessions, Mafélé Ouest and
N'kemene Ouest (the "Concessions").  Kodal has entered into a binding
agreement with Leo Lithium to sell the Mafélé Ouest concession and has
agreed terms for the sale of the N'kemene Ouest concession, conditional on
renewal of the licence.  The concessions are held in the name of Bambara
Resources SARL and Kodal has exclusive access rights for mineral exploration
activities on the concessions and an option to acquire an 80% legal and
beneficial interest in the concessions.

 

The transaction will allow Leo Lithium to acquire 100% ownership of the
Concessions for a total cash consideration of £2.5 million (£1.0m for
Mafélé Ouest and £1.5m for N'kemene Ouest), of which £2 million will be
paid to Kodal and £0.5 million will be paid to the original Concessions
holder, Bambara. The Mafélé Ouest cash consideration will be paid £0.5
million to Bambara within 5 days, £0.4 million to Kodal within 5 days and
£0.1 million to Kodal on finalisation of the transfer of ownership. The
N'kemene Ouest cash consideration will be paid to Kodal, subject to binding
agreements being executed as explained below.  In addition, Leo Lithium will
pay a 2% gross royalty on future revenue from the Concessions, 1.4% for Kodal
and 0.6% for Bambara. In the event of an economic mineral discovery on the
area of the Concessions which is supported by a bankable feasibility study,
then on the granting of a mineral exploitation licence over that area, Kodal
has the right to be issued an equity carried interest of 15% in any
exploitation company set up for each Concession (subject to dilution from the
Mali Government) for no consideration. Leo Lithium is obliged to spend a
minimum of AUD$125,000 over two years on mineral exploration activities on
each of the Concessions.

 

The process for the transfer of the licence for Mafélé Ouest will commence
immediately and is expected to take a number of weeks to complete.  The final
binding agreement for sale of the N'kemene Ouest concession will be executed
when the licence renewal documentation for the concession is received.  The
status of the renewal is that it has been accepted by the Direction Nationale
de la Geologie etmdes Mines (DNGM) of Mali and recommended for renewal, with
the final documents at the Mali Minister of Mines office pending signature.
It is therefore expected that the agreement for the sale of the N'kemene Ouest
concessions will be executed and the commencement of transfer will commence
when the licence renewal is received.

 

**ENDS**

 

For further information, please visit www.kodalminerals.com
(http://www.kodalminerals) or contact the following:

 

 Kodal Minerals plc

 Bernard Aylward, CEO                                                  Tel: +61 418 943 345

 Allenby Capital Limited, Nominated Adviser

 Jeremy Porter/Vivek Bhardwaj/Nick Harriss                             Tel: 020 3328 5656

 SP Angel Corporate Finance LLP, Financial Adviser & Joint Broker

 John Mackay/Adam Cowl                                                 Tel: 020 3470 0470

 Canaccord Genuity UK LLP, Joint Broker

 James Asensio/Gordon Hamilton                                         Tel: 0207 523 4680

 St Brides Partners Ltd, Financial PR

 Susie Geliher/Ana Ribeiro                                             Tel: 020 7236 1177

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  DRLGPUUWCUPWUMB