Mustang Resources
Feasibility study drilling at Caula project, August 2018. Image from Mustang Resources.

ASX-listed Mustang Resources has successfully completed the feasibility study drilling programme at its flagship Caula vanadium-graphite project ahead of schedule.

Mozambique – A total of 3 025 m of diamond drilling and 1 130 m of reverse-circulation drilling over 34 holes have been completed for a total of 4 155 m, with the core and chips currently being cut and sampled on site.

The success of the drilling programme has resulted in extensions of the existing resource boundaries with visually high grade, coarse (large flake) graphite and vanadium-micas being intersected and logged.

Furthermore, graphite and roscoelite mineralisation has been intersected in all 34 holes drilled. These results clearly confirm the expansion potential of the existing resource and open-endedness of the Caula vanadium-graphite deposit.

In the immediate vicinity of the Caula discovery, vanadium-graphite mineralisation has now been defined over a 850 m strike length (from 540 m previously, open-ended to the south) and this mineralisation is up to 430 m wide estimated true thickness (from 230 m previously).

Caula scoping study progress and phase 1 trial mining & processing

The scoping study being undertaken by independent engineering company Bara International is well advanced and the company expects the study to be completed with the results announced between 24 September and 5 October 2018.

Bara is currently modelling a two-phased development for Caula, based on the JORC measured resource for both graphite and vanadium.

The company is also still on track to generate its first cash flow from Caula in H2, 2019, with the implementation of a Phase 1 trial mining and processing operation, the scale and economics of which will be defined in the scoping study.

Mustang Resources MD Dr Bernard Olivier comments:

“It is Mustang’s view that Caula represents a unique opportunity for the supply of two critical raw materials (graphite & vanadium) which are needed for the storage of energy (lithium-ion batteries & vanadium redox flow batteries), next generation building materials (expandable graphite) and earthquake resistant steel-rebar (vanadium as alloy).

“As such, the company is committed to fast-tracking this project and will therefore be running a number of workflows concurrently to ensure the fast and effective development of this world-class project.

“The pending scoping study report is expected to be a major step towards achieving this milestone. We believe that the scoping study will clearly demonstrate the exceptional potential and economic value of the Caula project. The Mustang team, with their 15 years of experience in building mining projects in Africa, will continue to work hard to deliver value for our shareholders. I furthermore wish to thank our team for safely and professionally concluding the feasibility study drilling campaign well ahead of schedule.”

The next 6 to 12 months should be a period of intensive activity for Mustang (to be renamed to

“New Energy Minerals” subject to shareholder approval) with the company focusing on delivering the following key outputs:

  1. The Caula scoping study currently underway which is targeted for completion in late September 2018.
  2. Preliminary vanadium metallurgical work at Nagrom Laboratories in Perth.
  3. ~5 000 m of feasibility study drilling at Caula to deliver a further resource upgrade, as well as samples for geotechnical testing and further metallurgical testing in Perth and China.
  4. The change of the company’s name and brand to “New Energy Minerals” (subject to shareholder approval) and associated change in company logo and corporate colours.
  5. The concurrent 1:10 consolidation of the company’s issued shares followed by an investor roadshow in the UK and Europe and attendance at the 121 Investor Conference in Hong Kong.
  6. Engagement and negotiations with proposed strategic project partners and off-takers in Asia, Europe and North America.
  7. Feasibility studies for the Caula project.
  8. Mining concessions, permitting and approvals from the Government of Mozambique.
  9. Phase 1 trial mining and pilot plant construction and commissioning at Caula.