Drilling at the Mpokoto project site

Democratic Republic of Congo – AIM quoted Armadale, which is developing its Mpokoto gold project in the Katanga province, is looking to raise net proceeds of £270 000 to continue its development.

Drilling at the Mpokoto project site
Drilling at the Mpokoto project site

The cash will be raised vai a conditional placing of 966,666,663 new ordinary shares of 0.01 pence each in the capital of the company at a price of 0.03p pence per share to raise the £270 000 with institutional and other investors.

The Mpokoto gold project has a resource of 678 100 oz of gold.

The cash will also provide general working capital for the company as it continues discussions with potential funding partners to secure the $20 million of capital required to commence construction of the project ahead of commencing commercial gold production in H1, 2016.

Armadale recently announced further positive metallurgical testwork on a number of samples of oxide ore from Mpokoto which confirmed gold recovery of 84-92% from the ore. The company is now finalising a definitive feasibility study on the project which advances the work already undertaken as part of the expanded scoping study.

Peter Marks, Chairman of Armadale, says: “We are pleased with the continued support of the capital markets and the shareholders of Armadale as we continue to advance the Mpokoto gold project. These funds will allow us to progress the definitive feasibility study in the near term, which is targeted for completion in Q2, 2015, and will provide us with a stable footing from which to continue our negotiations with regard to the financing required to commence construction of the project.”

“We look forward to advancing the Mpokoto gold project into production in H1, 2016 as a low capex gold project, with a post-tax NPV of US$55.3 million and steady state production of 25 600 oz over a nine year life of mine.”

Justin Lewis, CEO of Armadale
Justin Lewis, CEO of Armadale

Justin Lewis and Peter Marks, the directors of the company, will be subscribing for Placing Shares in the Placing.

The subscription for Placing Shares by the Directors are considered to be related party transactions pursuant to the AIM rules for companies. Given that both of the directors are participating in the Placing, there are no independent directors of the Company.  The company’s nominated adviser, finnCap, considers that the terms of the subscription for Placing Shares by the directors are fair and reasonable insofar as the company’s shareholders are concerned.

Top Projects Stories in the DRC:

Banro reports its highest gold production yet in DRC

Burey Gold’s DRC Giro project on track with results in spite of bad weather

Mawson West receives US$33.4 million investment for DRC copper mine development