TIDMNCCL
RNS Number : 5983D
Ncondezi Energy Limited
21 October 2022
News Release
Strategic review of Coal Asset
21 October 2022: Ncondezi Energy Limited ("Ncondezi" or the
"Company") (AIM:NCCL) provide an update on the integrated Ncondezi
300MW power and mine project in Tete, Mozambique (the
"Project").
Key highlights:
-- Process to find acquirer or JV partner launched to identify
potential organisations that are able to fund and mine coal
resources at the Project, potentially unlocking shareholder
value
-- Project power plant continues on care and maintenance pending
the above and clarification on the potential for Chinese funding
for that power plant project
-- Sustained high global thermal coal prices create a potential
opportunity to exploit the Project's 4.0Bn tonne coal resources
-- Ncondezi to now focus its operations on delivering its 300MW
solar PV project (the "Solar Project") and reposition as a green
and sustainable energy developer
Ncondezi Chief Executive Officer, Hanno Pengilly said:
"Following an internal review of the Company's operations, the
Board has resolved to launch a process to identify a suitable
organisation who can take the lead on further developing, financing
and mining the Company's coal resources whilst the Company focuses
on developing its Solar Project and renewable energy strategy. This
decision follows the ongoing delays in progressing the coal power
Project, strong export thermal coal prices and positive progress
with the Company's 300MW solar PV power project.
Our development partner, CMEC, still has no clarity on when a
decision regarding financing from China for the coal power plant
will be made. With global demand for thermal coal at record highs,
the Company believes that identifying a strategic partner to fund
and mine the coal could unlock significant value for all
stakeholders in the near term.
The current JORC coal resource which has been extensively
drilled out, is 4.0 billion tonnes mineable tonnes in situ ("MTIS")
with a measured resource of 120 million MTIS accessible at shallow
depths as shown in the 2012 Definitive Feasibility Study ("DFS").
This is more than sufficient to supply the planned 300MW power
plant for its 25 year life and provide an attractive opportunity
for coal miners looking to secure coal capacity that is fully
permitted and ready to be mined from a proven coal export hub
now.
We believe that whilst the coal operations offer significant
potential value, the further development of these operations would
be better in the hands of others with access to coal financing and
mining expertise. The Company has put its coal power operations on
care and maintenance and will focus on delivery of the Solar
Project whilst the strategic partner process progresses in
parallel.
The Solar Project feasibility study remains on track to be
delivered at the end of October 2022 and we look forward to
providing an update at the appropriate time."
About the Ncondezi Mine Project
The Ncondezi Mine Project provides the opportunity to develop an
open pit, truck and shovel mining project for the domestic and
export thermal coal markets. The project is located in the coal
mining hub of the Moatize District in the Tete Province of
Mozambique close to the existing large scale Moatize and Benga
coking coal mines. The Ncondezi Mine Project lies approximately
40kms north east of Moatize and is reachable along the main
national highway connecting the capitals of Zimbabwe and Malawi.
The location is also a strategic coal export hub, benefiting from
two existing export coal rail corridors, the Sena and Nacala
railway lines, which run directly to the Mozambican coast and are
well positioned to supply coal into India and South East Asia.
Between 2009 and 2013, roughly US$40m was spent proving up the
potential of the project with 78,274 metres drilled over 524
boreholes delivering a classified JORC coal resource of 4.0 billion
tonnes. An infill drilling programme over the planned open pit
mining area (the "South Block") upgraded 120 million tonnes (MTIS)
into the Measured category, the highest resource classification, in
accordance with the 2012 Edition of the JORC Code.
A number of optimisations were carried out at the Ncondezi Mine
Project to identify the most economical and viable strategy to
exploit the resource, including potential for export, with the
completion of Definitive Feasibility Studies in 2012 and 2013.
However, since 2013, the focus has been on delivery of a dedicated
and cost effective fuel supply mining operation for the 300MW
Ncondezi Power Project.
The Ncondezi Mine Project is an advanced stage project, having
received its Mining Concession from the Ministry of Mineral
Resources and Energy ("MIREM") as well as receiving its land use
agreement, or DUAT in Mozambique, from the Mozambican Government
granting exclusive use for mining in October 2021. The project was
designed to have minimal impact on its surroundings with no
relocations of communities or homes and received approval of its
Environmental Social Impact Assessment ("ESIA") study in October
2013 from Ministry for Coordination of Environmental Action
("MICOA"), although this would need to be updated and approved
again ahead of any new mining operations taking place.
Competent Person's Statement
The information in this RNS that relates to coal resources has
been reviewed by and is based on information compiled by Mark Craig
Stewardson and Gavin Stuart Andrews of Mineral Corporation
Consultancy (Pty) Limited. Both Mr Stewardson and Mr Andrews are
Competent Persons who are registered as Professional Natural
Scientists in the field of Geological Science with the South
African Council for Natural Scientific Professions, a Recognised
Professional Organisation included in a list that is posted on the
ASX website from time to time. Neither Mineral Corporation
Consultancy (Pty) Limited nor any of its Directors, staff or
sub-consultants who contributed to this resource estimation has any
material interest in Ncondezi or in the assets under
consideration.
Both Mr Stewardson and Mr Andrews have sufficient experience
that is relevant to the type of coal deposit under consideration
and to the activity being undertaken to qualify as Competent
Persons as defined in the 2012 Edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves (the JORC Code). Mr Stewardson and Mr Andrews consent to
the inclusion in this RNS of the information based on their work in
the form and context in which it appears.
The JORC Code sets out minimum standards, recommendations and
guidelines for Public Reporting of Exploration Results, Mineral
Resources and Ore Reserves. The information contained in this
release has been presented in accordance with the JORC Code and
references to "Measured" Resources are relevant to that term as
defined in the JORC Code.
A Competent Person's Consent Form dated 18 May 2015 relating to
the Ncondezi 2014 Annual Report and Financial Statements is held on
record by Ncondezi. There have been no changes to the coal resource
estimates since 18 May 2015.
The Project Resource report was compiled in accordance with the
2004 version of the JORC Code and the Measured Resource report was
compiled in accordance with the 2012 version of the JORC Code.
The references for the supporting reports to the resource
estimations are:
-- Mineral Corporation Consultancy (Pty) Limited, February 2013:
Coal Resource Estimates for Licences 804L and 805L, Tete Province,
Mozambique; and
-- Mineral Corporation Consultancy (Pty) Limited, November 2013:
Measured Coal Resource Estimate for South Block, Ncondezi Project,
Tete Province, Mozambique.
Resource Summary
Overall Project Resources (Source: Coal Resource Estimates for
Licences 804L and 805L, Tete Province, Mozambique, Mineral
Corporation Consultancy (Pty) Limited, February 2013. Subsequently
reviewed by Mineral Corporation Consultancy (Pty) Limited in May
2015)
MTIS Qualities (air-dried basis)
--------------------- ----------- -------- -------- -------- -------------------------------------------------------------------------------------------------
Coal type Resource GTIS TTIS MTIS Raw 17 MJ/kg CV Primary Product
Category Mt Mt Mt
--------------------- ----------- -------- -------- -------- ----------------------------------------------- ------------------------------------------------
RD IM AS VM FC CV TS Yield IM AS VM FC CV TS
% % % % MJ/kg % % % % % % MJ/kg %
--------------------- ----------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
High Volatile Indicated 867.0 772.8 742.5 1.85 1.4 53.5 18.1 27.0 13.83 1.01 71.3 1.4 44.4 20.5 33.7 17.61 1.09
--------------------- ----------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Inferred 3,605.2 3,035.8 2,367.4 1.94 1.9 57.7 18.6 21.9 11.79 1.00 62.6 2.0 44.7 22.2 31.1 17.07 1.13
--------------------------------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Low-mid Volatile Indicated 819.5 737.6 723.9 1.91 1.9 51.8 7.5 38.7 12.73 0.88 71.7 1.9 42.6 9.1 46.4 17.29 1.01
--------------------- ----------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Inferred 264.8 225.1 172.8 1.92 1.8 52.1 7.6 38.5 12.78 0.83 70.8 1.8 42.5 9.0 46.7 17.41 0.98
--------------------------------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Sub-totals/Averages Indicated 1,686.5 1,510.4 1,466.4 1.88 1.7 52.7 12.9 32.8 13.29 0.94 71.5 1.6 43.5 14.9 40.0 17.45 1.05
--------------------- ----------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Inferred 3,870.0 3,260.9 2,540.1 1.94 1.9 57.4 17.8 23.0 11.86 0.99 63.2 1.9 44.6 21.2 32.3 17.09 1.12
--------------------------------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Ind &
Total Inf 5,556.6 4,771.3 4,006.5 1.92 1.8 55.6 16.0 26.6 12.38 0.97 66.2 1.8 44.1 18.7 35.4 17.24 1.09
--------------------- ----------- -------- -------- -------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Notes:
Indicated resources were defined within areas where the spacing
of boreholes with raw coal quality data is approximately 500
metres. Extrapolation of these areas was limited to approximately
250 metres.
Inferred resources were defined within areas where the spacing
of boreholes with raw coal quality data is approximately 2,000
metres. Extrapolation of these areas was limited to approximately
1,000 metres.
Mt=million tonnes.
GTIS (gross tonnes in situ) figures represent the entire
classified resource for the block, below the observed limit of
weathering, with application of 0.5 metre minimum ply thickness
cut-off, but no depth restriction (in the Central Block, classified
resources reach approximately 400m depth; in the North Block 600m;
in the South and West Blocks 300m, in the East Block 330m and in
the River Block 500m).
TTIS (total tonnes in situ) figures for high and low volatile
coals were calculated from the GTIS tonnage by applying Geological
Losses. The losses applied were generally 10% for Indicated
resources and 15% for Inferred resources. In the Central Block,
these increased to 15% and 20% respectively.
MTIS (mineable tonnes in situ) figures represent that part of
the TTIS which exists above a depth of 250m.
All qualities are quoted on an air-dried-basis. RD=Relative
Density, IM=Inherent Moisture, AS=Ash Yield, VM=Volatile Matter
Content, FC=Fixed Carbon, CV=Calorific Value, TS= Total
Sulphur.
Product yields are theoretical yields for +0.5mm material
derived from slim core samples.
RDs were weighted against MTIS coal volume to obtain average
RDs.
Raw qualities and product yields were weighted against MTIS
tonnage to obtain average raw qualities and product yields.
Product qualities were weighted against wash yield and MTIS
tonnage to obtain average product qualities.
The coal volatile category was determined using raw volatile
contents on a dry, ash-free basis and adjustment factors related to
the raw ash yield of the coal.
Low-mid volatile coals have been devolatilised by igneous
intrusions. A pre-feasibility study by Hugh Brown and Associates
indicates that these coals are suitable for power generation.
Low volatile coals are not common in the Central, West and River
Blocks and have been excluded from resources in those blocks.
The Central, North, South and East Block models comprise
detailed ply models suitable for mine planning purposes. The West
and River Block models utilise a cumulative coal thickness
methodology that is appropriate only to the classification of
Inferred Resources.
No allowance has been made for potential sterilisation of
resources below the limits of the Ncondezi or Revuboe Rivers' flood
lines. This could affect resources in the Central, North, West and
River Blocks.
Certain amounts of averaged 'control' data were included in the
quality database, particularly wash analyses of low volatile coal
samples.
South Block Measured Resources ( Source: Measured Coal Resource
Estimate for South Block, Ncondezi Project, Tete Province,
Mozambique, Mineral Corporation Consultancy (Pty) Limited, November
2013. Subsequently reviewed by Mineral Corporation Consultancy
(Pty) Limited in May 2015)
TTIS / MTIS Qualities (air-dried basis)
----------- ---------- ------- ------- -------------------------------------------------------------------------------------------------
Ply Volatile GTIS TTIS Raw 16.12 MJ/kg CV Product (theoretical)
Grouping Category Mt /
MTIS
Mt
----------- ---------- ------- ------- ----------------------------------------------- ------------------------------------------------
RD IM AS VM FC CV TS Yield IM AS VM FC CV TS
% % % % MJ/kg % % % % % % MJ/kg %
----------- ---------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Sub-total
plies
A18-A48 Low-mid 52.90 48.93 1.85 1.2 50.4 9.3 39.1 13.26 1.15 78.7 2.0 43.0 10.1 44.9 16.72 0.99
----------- ---------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
High 39.04 36.11 1.72 0.9 45.8 19.9 33.4 17.17 1.22 92.9 1.3 44.5 20.2 34.1 17.52 1.09
---------------------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Sub-total
plies
A02-A16 Low-mid 26.66 24.66 1.98 1.1 62.1 8.8 27.9 8.81 0.77 48.4 1.8 44.9 10.2 43.0 16.18 0.84
----------- ---------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
High 10.86 10.05 1.90 0.7 59.3 15.5 24.5 11.14 0.91 56.3 1.0 47.3 18.1 33.6 16.32 0.92
---------------------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Total
All plies Low-mid 79.55 73.59 1.89 1.1 54.3 9.2 35.4 11.77 1.03 68.5 2.0 43.5 10.1 44.4 16.59 0.96
----------- ---------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
High 49.90 46.16 1.76 0.9 48.7 18.9 31.5 15.86 1.16 84.9 1.2 44.9 19.9 34.0 17.35 1.07
---------------------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Overall averages
& tonnages: 129.45 119.74 1.84 1.0 52.2 12.9 33.9 13.35 1.08 74.8 1.6 44.1 14.4 39.9 16.92 1.01
----------------------- ------- ------- ----- ---- ----- ----- ----- ------ ----- ------ ---- ----- ----- ----- ------ -----
Notes:
Measured Resources are a subset of the Indicated and Inferred
Resources reported in February 2013.
Measured Resources were defined within an area where the spacing
of boreholes with raw coal quality date is approximately 250m.
Extrapolation of this area was limited to 125 metres beyond the
outermost qualifying boreholes.
Mt=million tonnes.
GTIS (gross tonnes in situ) figures represent the entire
Measured Resource below the observed limit of weathering and with
application of 0.5m minimum ply thickness cut-off.
TTIS (total tonnes in situ) figures were calculated from the
GTIS tonnage by applying Geological Losses of 7.5%.
MTIS (mineable tonnes in situ) figures represent that part of
the TTIS which exists above a depth of 250m. As all the Measured
Resource is shallower than 120m, the TTIS in this case equals the
MTIS.
A raw ash yield limit of 70% was generally applied at the time
of ply definition and correlation.
All qualities are quoted on an air-dried-basis. RD=Relative
Density, IM=Inherent Moisture, AS=Ash Yield, VM=Volatile Matter
Content, FC=Fixed Carbon, CV=Calorific Value, TS=Total Sulphur.
Product yields are theoretical yields for +0.5mm material
derived from core samples.
RDs were weighted against TTIS/MTIS coal volume to obtain
average RDs.
Raw qualities and product yields were weighted against TTIS/MTIS
tonnage to obtain average raw qualities and product yields.
The 16.12MJ/kg CV target product specification was provided by
Ncondezi.
Product qualities were weighted against wash yield and TTIS/MTIS
tonnage to obtain average product qualities.
Low-mid volatile coals have been devolatilised by igneous
intrusions. A pre-feasibility study by Hugh Brown and Associates
indicates that these coals are suitable for power generation.
The coal volatile category was determined using raw coal
volatile contents on a dry, ash-free basis and adjustments factors
related to the raw ash yield of the coal.
Certain amounts of averaged 'control' data were included in the
quality database, where adequate analytical data did not exist in
pre-2013 boreholes.
Based on the relative distribution of coal plies, partings and
dolerite sills, and coal ply qualities, the mining package will
likely generally comprise plies A18 to A44, with plies A46 and A48
taken at the top where possible. Sub-totals have therefore been
supplied for ply groupings A02-A16 and A18-A48.
Enquiries
For further information please visit www.ncondezienergy.com or
contact:
Ncondezi Energy Hanno Pengilly +27 (0) 71 362 3566
Liberum Capital Limited Scott Mathieson, Edward Thomas, +44 (0) 20 3100
NOMAD & Joint Broker Kane Collings 2000
Novum Securities
Limited +44 (0) 20 7399
Joint Broker Colin Rowbury 9427
Pimlico Advisory
Ltd +44 (0) 777 56 55
Investor Relations Elizabeth Johnson 927
About Ncondezi Energy
Ncondezi is an African power development company focused on the
development of renewable and baseload energy solutions at its
concession located in the Tete Province, northern Mozambique.
The Company is focused on providing reliable and affordable
energy to Mozambique to meet growing energy demands. Our projects
support Mozambique's energy strategy of universal electricity
access by 2030. According to the World Bank, only 30% of the
Mozambican population had access to energy in 2017. Our projects
would provide reliable and available power helping to close the
infrastructure gap of the region and serving as a catalyst for
economic development.
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 or visit 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.
END
MSCEADEEAFAAFFA
(END) Dow Jones Newswires
October 21, 2022 02:00 ET (06:00 GMT)
Solgenics (LSE:SGN)
Historical Stock Chart
From Apr 2024 to May 2024
Solgenics (LSE:SGN)
Historical Stock Chart
From May 2023 to May 2024