HeaderBGImage

Technical Studies

BLACK ROCK MINING PFS CONFIRMS HIGH MARGIN, LOW CAPEX POTENTIAL FOR MAHENGE GRAPHITE MINE

Tanzanian graphite developer Black Rock Mining Limited (BKT: ASX) (“Black Rock” or “the Company”) is pleased to announce the successful completion of the Optimisation Study of its previously released Preliminary Feasibility Study (“PFS”) (ASX Release 24 April 2017) for its 100%-owned Mahenge Graphite Project (“the Project”).

Highlights:

  • Three stage construction to deliver a maximum of 250k tonnes per annum of 98.5% graphite concentrate for 31 years. Stages two and three to be funded from free cash flow
  • Pre-production capex remains US$90.1m
  • Steady state opex reduced to US$378 per tonne
  • Realistic basket price assumption of US$1,241 per tonne delivering an operating margin of US$863 per tonne
  • Ore Reserves increased to 69.6m tonnes at 8.5% Total Graphite Contained (TGC) contributing to 80% of planned mill feed
  • Revised financial metrics with pre-July 2017 legislation include:
    • Post-tax unlevered project NPV10 of US$1.11bn (increasing from April 2017 PFS of US$624m)
    • Post-tax, unlevered IRR of 50.1% (increasing from April 2017 of 48.2%)
    • EBITDA in first full year of production US$220 million (EBITDA margin of 66%) (increasing from April 2017 PFS of US$135 million)
  • Revised financial metrics incorporating a 16% Government free carry and increased royalty rate include:
    • Post-tax unlevered project NPV10 of US$905m
    • Post-tax, unlevered IRR of 45.1%
  • Financing process on track supported by two existing MOUs with end users of graphite concentrate

Tanzanian graphite developer Black Rock Mining Limited (BKT: ASX) (“Black Rock” or “the Company”) is pleased to announce the successful completion of the Optimisation Study of its previously released Preliminary Feasibility Study (“PFS”) (ASX Release 24 April 2017) for its 100%-owned Mahenge Graphite Project (“the Project”).

The Optimisation Study adds a third staged module to take production to 250k tonnes per annum of 98.5% graphite concentrate for 31 years. The second and third modules are expected to be funded from cash flow, enabling the Company to deliver the entire operation for peak capital of only US$90.1m. This equates to industry leading peak capital of only US$360 per tonne per annum. This exceptional result is driven by relative high grade, low strip ratios
and industry leading product quality and attributes.

Black Rock’s Interim CEO and Executive Director, John de Vries commented:

“The Optimisation Study successfully builds out our crawl, walk, run strategy, ultimately delivering a world-class mine based on any metrics. At a maximum run rate of 250k tonnes per annum, of the highest purity graphite concentrate on the market, with exceptionally low opex, and capex, this study places us in a strong competitive strategic position. As the market progressively starts to benefit from increased demand driven by the transition from petrol to electric vehicles, and demand for fire proofed panels for high rise buildings grows, demand for Mahenge’s premium product will grow.

“We continue to be highly confident we have the most compelling development stage graphite project globally and intend to quickly move into our DFS phase to ensure construction risks are minimised.”

 

To read the full PFS Optimisation Study announcement, please click here

To read the full PFS announcement, please click here

Back-To-Top