Month: October 2018

QUARTERLY ACTIVITIES REPORT TO 30 SEPTEMBER 2018

QUARTERLY ACTIVITIES REPORT TO 30 SEPTEMBER 2018

Highlights

  • Feasibility Study completed for the initial Stage 1 start-up operations at flagship Bunyu
    Graphite Project in Tanzania – key outcomes include:

    • Stage 1 based on a mining and processing plant annual throughput rate of 400,000
      tonnes to produce 20,000 to 24,000tpa of graphite products
    • Average FOB operating cost of US$658 per tonne and start-up capital cost
      estimate of US$31.6M
    • Pre-tax NPV10 of US$19.5M
    • Pre-tax IRR of 21.6%
    • EBITDA of US$94.5M over 7-year project life
  • Key approvals granted during the quarter for Stage 1 and 2 developments at Bunyu:
    • Environmental and Social Impact Statement approved
    • Mining Licences for Bunyu secured post-quarter end
  • Binding offtake agreement signed with major Chinese graphite company Qingdao
    Tiangshengda Graphite for 9,000 tpa of Bunyu product over five years
  • Amended prospectus for the US$40 million Tanzanian Note Issue lodged with the
    Tanzanian Capital Markets and Securities Authority (CMSA) and the Dar es Salaam Stock
    Exchange (DSE) – note issue process advancing.

Volt Resources Limited (ASX: VRC) (“Volt” or, the “Company”) is pleased to provide shareholders with its quarterly activities report for the period ended 30 September 2018.

September Quarter Activities Review

Stage 1 Feasibility Study Completed

During the quarter, the Company completed the Feasibility Study (“FS”) into the Stage 1 development of the flagship Bunyu Graphite Project (“Bunyu”) located in Tanzania.

The Stage 1 development is focused on the development of a 20,000 to 24,000tpa graphite mine and processing facility in Tanzania with exports of graphite products planned into the USA, China and other markets.

The development incorporates a significant amount of infrastructure, utilities and mine development work that will deliver significant benefits to the Stage 2 expansion including the site access road, plant laydown area, tailings storage facility, waste dumps, stockpile areas, open pit development and mining, accommodation village and water supply.

The proposed Stage 2 development is an expansion of Stage 1 production based on the market demand for Bunyu’s graphite products and leveraging the large-scale graphite mineral resource and Bunyu’s close proximity to critical infrastructure.

Stage 2 is targeted to meet expected significant increases in demand for coarse flake graphite in the expandable graphite market and fine flake size products for battery anode material and other existing and evolving industrial uses for micro carbon products.

Key Bunyu Project Approvals Granted

The Company was also pleased to advise that during the quarter it received confirmation that two key project approvals had been granted for Bunyu. This ensures that all requisite environmental and regulatory approvals have now been accounted for in relation to the respective Stage 1 and 2 developments at Bunyu.

With the development of Bunyu now fully-approved, Volt is well placed to fast-track the start-up of production at the Stage 1 development.

Bunyu Environmental Approvals
In August, the Environmental Impact Assessment (EIA)  Certificate for Bunyu was granted by the National Environment Management Council of Tanzania to the Company’s 100%-owned subsidiary Volt Graphite Tanzania (“VGT”).

The EIA certificate represented the final pre-requisite for the granting of Volt’s Mining Licence (granted post-quarter end) and one of the final remaining major milestones in terms of Government permitting for Bunyu.

Volt’s Environmental and Social Impact Study submission was prepared in accordance with the requirements of relevant Tanzanian legislation, including the Environmental Management Act 2004; the Environmental Impact Assessment and Audit Regulations 2005 as well as the Mineral Sector Environmental Impact Assessment Guidelines 2014.

Bunyu Mining Licence Applications Granted
Post-quarter end, Volt was granted two Mining Licences (MLs) ML 591/2018 and ML 592/2018 covering Bunyu’s respective Stage 1 and Stage 2 developments from the Mining Commission of the Ministry of Minerals of Tanzania.

The Company formally received the MLs on 22 October 2018.

The granting of the MLs represented a major step forward, as the Company focuses on advancing the Bunyu Project towards Stage 1 production.

Community Relations
Volt Graphite Tanzania (VGT) management systems continue to mature with local communities being updated on the ongoing and planned project development activities through monthly update reports, Relocation Working Group meetings and meetings with the ward and village leaders.

The Lindi District Council’s Economic, Work & Environmental Committee visited the Bunyu 1 site in September and were impressed with the planned developments and continue to be supportive of the planned development. VGT initiated and sponsored the development of a formal Village Land Use Plan (VLUP) with the report generated last quarter and approved by the District Council on 31 July 2018.

The Lindi District Council’s Economic, Work & Environmental Committee Visit

The Lindi District Council’s Economic, Work & Environmental Committee Visit

 

Amongst VGT’s local financial contributions as part of its social investment program, the Company continued to pay a monthly allowance to Nursery School teachers at Utimbula village, donated desks for Utimbula Nursery School and financially contributed to the repair of storm damage at Namangale Primary School.

Offtake Agreements Signed
During the quarter, VGT signed a binding sales agreement with Qingdao Tianshengda Graphite Co. Ltd. (“Tianshengda”) for 9,000 tonnes per annum of Bunyu Graphite Product over five years.

Importantly, this represents the second binding offtake agreement signed by VGT, following the agreement signed in March 2017 with US based graphene company Nano Graphene Inc (NGI) for a minimum 5,000 tpa of flake graphite product over 5 years.

An integrated graphite processor and distributor across China and internationally, Tianshengda has a substantial annual capacity to further process graphite by producing value added products including expandable graphite, flake graphite and powder, as well as supplying graphite to the lithium ion battery market. There is an option for a further five-year term by mutual agreement as part of the sales agreement.

Furthermore, during the quarter VGT signed a cooperation agreement with one of China’s largest graphite companies, HAIDA Graphite (“HAIDA”).

Under the agreement, VGT and HAIDA exchange relevant information and conduct testing on VGT’s graphite product samples in order to build a working relationship between the two parties for the future supply and purchase of Bunyu Graphite Product.

Further discussions are continuing with additional parties in respect to additional offtake  opportunities and the Company looks forward to updating shareholders on these discussions in due course.

Corporate Activity

US$40 million Tanzanian Prospectus Update
As previously advised, Volt has partnered with Exotix Capital to undertake a Tanzanian Note issue to raise the required funding for the Stage 1 development at Bunyu (see ASX Announcement dated 25 October 2017).

During the quarter, the Company continued to advance the US$40 million Note Issue, for which an updated Prospectus was lodged with the Tanzanian Capital Markets and Securities Authority (“CMSA”) and the Dar Es Salaam Stock Exchange (“DSE”) on 17 August.

A further updated Prospectus was lodged with the CMSA on 28 September following feedback and requests for additional information. Correspondence with the CMSA has been ongoing and positive, and the Company expects this process to be finalised this quarter enabling VGT to proceed with the issue of the Note prospectus and commence the raising of development funding for the Stage 1 Bunyu project.

Resignation – Non-Executive Director
On 9 July 2018, Matthew Bull resigned as Non-Executive Director of the Company.

Cash Position and Mid-Term Funding
The Company finished the 30 September 2018 quarter with $420k in cash. Expenditure during the quarter included the repayment of convertible loans and accrued interest, payments to complete the Stage 1 Feasibility Study, Tanzanian related expenditure to complete the environmental approvals, advisor fees for the note prospectus and community relations activities.

The Company has progressed an assessment of its Research and Development claim for the 2017/18 fiscal year and is pleased to advise it will progress a loan with Radium Capital of approximately $510k to be received this quarter. This is an advance against the future proceeds to be received from the R and D claim once the Company completes and lodges its 2018 tax return.

In addition, the Company is currently reviewing proposals for bridge funding through to Q2 2019 while it completes the Tanzanian note issue in the short term.

Management Commentary
Volt Resources CEO Trevor Matthews commented:

“I am very pleased to report that a number of key milestones, both on a corporate and operational front, were delivered during the September quarter, collectively positioning Volt closer towards becoming a leading near-term producer of natural flake graphite from Bunyu.

“A noteworthy highlight was the completion of the Stage 1 Feasibility Study which outlined a set of robust parameters for the Stage 1 start-up operations, albeit on a significantly smaller scale in relation to our proposed Stage 2 expansion project which represents the big picture and future upside for Volt and its shareholders.

“Our funding initiatives, led by our Tanzanian note issue, are progressing well and following the satisfaction of a number of regulatory requirements we are confident of progressing with the note issue during this current quarter. Once finalised, Volt will narrow our focus towards commencing Stage 1 construction and production at Bunyu.

“I would also like to thank the relevant Tanzanian authorities for their continued support during the quarter in assisting Volt towards securing the approvals needed to advance Bunyu’s development. We maintain a very positive and transparent dialogue with our Tanzanian stakeholders and look forward to further solidifying this relationship.”

 

For and on behalf of Volt Resources Limited

Trevor Matthews
Chief Executive Officer

 

APPENDIX 5B

 


FOR PERSONAL USE ONLY
For further information please contact:

Trevor Matthews – Chief Executive Officer
Tel: +61 8 9486 7788

Posted by Volt Resources in Company News
VOLT RECEIVES BUNYU MINING LICENCES

VOLT RECEIVES BUNYU MINING LICENCES

Tanzanian-focused flake graphite development company Volt Resources Limited (ASX: VRC) (“Volt” or “the
Company”) is pleased to advise that it has formally received mining licences ML 591/2018 and ML 592/2018
from the Mining Commission of the Ministry of Minerals of Tanzania. As previously advised the two Mining
Licences cover the respective Stage 1 and Stage 2 developments of the Bunyu Graphite Project.

The two ML’s cover a combined area of 17.71km2 and provide Volt with the exclusive right to develop the
graphite resources in the ML area. The ML’s are effective for a period of 10 years and there is a right of
further 10 year renewals under section 53 of the Mining Act.

 

Volt Mine Layout

Stage 1 & Stage 2 Project Layout

 

Now that the Company has formally received the ML’s, the completion of the Tanzanian Note Issue for the
Bunyu development is the remaining key milestone prior to Volt’s subsidiary Volt Graphite Tanzania Ltd
(VGT) proceeding with front end engineering and design work for the initial Stage 1 operations and the
ordering of long lead time components.

Concurrently with the Stage 1 development, VGT plans to be undertaking the Definitive Feasibility Study
on the large-scale Stage 2 expansion at Bunyu.

 

For and on behalf of Volt Resources Limited

Trevor Matthews
Chief Executive Officer

1 Refer to Volt’s ASX announcement titled “Positive Stage 1 Feasibility Study Bunyu Graphite Project” dated 31 July 2018. The Company confirms that it is not aware of any new information or data that materially affects the information included in this document and that all material assumptions and technical parameters underpinning the estimates continue to apply and have not materially changed.

 


FOR PERSONAL USE ONLY
For further information please contact:

Trevor Matthews – Chief Executive Officer
Tel: +61 8 9486 7788

Posted by Volt Resources in Company News
BUNYU MINING LICENCES GRANTED

BUNYU MINING LICENCES GRANTED

Tanzanian-focused flake graphite development company Volt Resources Limited (ASX: VRC) (“Volt” or “the Company”) is pleased to advise that it has been notified by the Mining Commission of the Ministry of Minerals of Tanzania of the grant of the two Mining Licences covering the respective Stage 1 and Stage 2 developments of the Bunyu Graphite Project.

The Mining Licences (ML’s) have been granted subject to three conditions:

  1. An acceptance of the boundaries and co-ordinates as per the application as amended;
  2. Notice by the Company to accept the proposed licence; and
  3. Payment of US$1,000 in preparation fees for each licence.

Volt advises shareholders that it plans to accept or meet the licence conditions outlined above. The grant of the mining licences is a major step forward, as the Company focuses on advancing the Bunyu Project towards Stage 1 production and follows the completion of the Stage 1 Feasibility Study (see ASX Announcement dated 31 July 2018) and the finalisation of all required Environmental Approvals (see ASX Announcement dated 4 September 2018).

Bunyu Graphite Project – Accelerated Pathway to Production

As previously advised, Volt’s near-term focus remains firmly on the successful completion of the proposed US$40 million Note Issue, for which an updated Prospectus and accompanying documentation has been lodged with the Tanzanian Capital Markets and Securities Authority (“CMSA”) on 29 September 2018.

This process continues to advance in line with previous guidance and further updates will be provided in due course. Following the formal receipt of the ML’s, the completion of the Tanzanian Note Issue for the Bunyu development and approval by the Volt Board, Volt’s subsidiary Volt Graphite Tanzania Ltd (VGT) will proceed with front end engineering and design work for the initial Stage 1 operations and the ordering of long lead time components.

Concurrently with the Stage 1 development, VGT plans to be undertaking the Definitive Feasibility Study on the large-scale Stage 2 expansion at Bunyu.

Volt’s Chairman, Asimwe Kabunga, commented:

“This is a key milestone for Volt and our shareholders, as we have now effectively received all required primary development approvals in relation to our planned Stage 1 and 2 developments at the Bunyu graphite project in Tanzania.”

“Volt has maintained a very transparent and positive dialogue with the Tanzanian authorities throughout the entire approvals process, and I would like to thank the relevant authorities for their support and input towards achieving these key approvals.”

“The Company looks forward to continuing to work with the Tanzanian authorities over the coming months as we near the start-up of operations from our Stage 1 development.”

 

For and on behalf of Volt Resources Limited

Trevor Matthews
Chief Executive Officer

 


FOR PERSONAL USE ONLY
For further information please contact:

Trevor Matthews – Chief Executive Officer
Tel: +61 8 9486 7788

Posted by Volt Resources in Company News
BUNYU PROJECT MINING LICENCE APPLICATIONS ADVANCED

BUNYU PROJECT MINING LICENCE APPLICATIONS ADVANCED

Tanzanian-focused flake graphite developer Volt Resources Limited (ASX: VRC) (“Volt” or “the Company”) is pleased to advise that the two Mining License Applications (“MLA”) for the Company’s Bunyu Graphite Project have been recommended for approval within the Tanzanian Ministry of Minerals online Cadastral system.

As previously advised (see ASX announcement dated 8 February 2018), Volt has lodged two MLA’s with the Ministry of Minerals of Tanzania which covers the footprint for both the Stage 1 and 2 developments at the Bunyu Graphite Project.

This recommendation represents an encouraging step forward in the MLA approval process, however this status change does not constitute final approval and receipt of the ML’s. Further updates on the ML approval process will be provided to shareholders in due course.

Tanzanian Note Issue Prospectus Update

Volt continues to advance the US$40 million Note Issue, for which an updated Prospectus was lodged with the Tanzanian Capital Markets and Securities Authority (“CMSA”) and the Dar es Salaam Stock Exchange (“DSE”) on August 17, 2018.

Correspondence with the CMSA has been ongoing and positive with the Company preparing to lodge a further update of the Prospectus and associated documents. Volt is satisfied with the recent progress in relation to regulatory approval of the Prospectus with a conclusion expected in the near future.

For and on behalf of Volt Resources Limited

Trevor Matthews
Chief Executive Officer

 


FOR PERSONAL USE ONLY
For further information please contact:

Trevor Matthews – Chief Executive Officer
Tel: +61 8 9486 7788

Posted by Volt Resources in Company News