Kaboko Mining Limited (ASX: KAB) (Kaboko) has concluded the first sale of high-grade Manganese ore from its Mansa Mine to the Noble Group under its $10M pre-pay and offtake agreement (Noble Agreement).Kaboko’s CEO, Tokkas Van Heerden said, following the first sale of commercial scale production of the company’s high-grade manganese to the Noble Group: “I welcome the further investment of Noble into Kaboko some 12 months in advance of the schedule anticipated in the Agreement. This delivery of ore and acceleration of funding cements the partnership between the company and the Noble Group and provides a strong foundation for continued production and cash-flow growth.” Noble has agreed to purchase the ore full-on-truck (FOT) at the mine site and has initiated delivery of containers to site to commence transportation. Since the Noble Agreement in March this year, Kaboko has rapidly brought the Mansa Mine into operation and production from the mine has reached 5 000 tonnes per month, with a current stockpile of 10 000 tonnes high grade manganese on site and a further 22 000 tonnes of alluvial unprocessed overburden being stockpiled. The sale comprises an initial 2 000 tonnes of high grade manganese to Noble under the Noble Agreement which is currently being loaded on site for delivery in the coming weeks.
As previously announced, initial testing of the first delivery undertaken by independent laboratories returned results of 50% plus manganese from grab samples in line with the company’s expectations (refer to ASX announcement dated 24 July 2013). Further testing will be undertaken as part of completion of delivery. A second shipment of 2 000 tonnes of high grade manganese will then be loaded for delivery from the existing stockpile on site. Additional Mining Plant and Equipment
A further US$1.16m has been drawn pursuant to the Noble Agreement to upgrade key plant and equipment with a view to increase production to in excess of 10 000 tonnes per month. This includes the addition of a scrubber trommel and jig circuit to be used in conjunction with the semi-modular crushing plant as well as a front end loader, excavator and other key equipment items. This additional drawn down underlines the on-going Noble Group support for the project and the on-going development of the company.
The scrubber trommel and jig circuit will be used to recover 25-30% of the high grade manganese nodules that are in the alluvial overburden and will be initially used to process the alluvial stockpile already on site. This unit will upgrade the manganese ore mined, particularly from the alluvial overburden, and is also able to be used to process material during the wet season. The company anticipates that this capital investment in further mining plant and equipment will see production ramping up to achieve targets of 120 000 tonnes per annum, deliverable under the Noble Agreement. Mansa Project Development
As previously announced, the company’s initial scoping study on the Northern Zambian manganese project at Mansa was completed by independent consultant, Minxcon, which included an indicative high grade manganese resource estimate and mine plan for operations based on an initial 7 year mine plan (refer to ASX announcement dated 21 May 2013).
The exploration programme to drill approximately 24 holes (1 200m) targeting extension of existing mineralisation zone is currently underway. The results of this programme will be used in conjunction with the recent scoping study which provided the foundations for a JORC compliance resource statement at the Mansa Project which is expected to be completed Q3 2013. It is important to note that the Mansa Project license area covers approximately 90km² and the scoping study focused on the known mineralisation area which represents less than two per cent of the total Mansa Project area, emphasising the significant exploration potential of the project.
The company has identified several acquisition opportunities in other parts of Africa and South Africa. It is considering a number of projects with synergistic high-grade ore bodies that are in or near to production. As these opportunities develop the company will advise the market accordingly.
- Kaboko concludes first sale of 2 000 tonnes of high-grade Manganese ore to the Noble Group;
- A further US$1.16M has been drawn from Tranche B of the $10M Pre-Pay Facility for additional key mining plant and equipment to accelerate production underlines the ongoing Noble Group support for the project and the Company;
- Production set to increase from 5,000 tonnes per month to in excess of 10,000 tonnes per month;
- Maiden JORC resource on track for Q3, 2013 with drilling underway;
- New high-grade African manganese opportunities identified for review