Edenville Energy Plc (AIM: EDL), the AIM quoted company developing the Rukwa coal project in southwest Tanzania (“Rukwa” or the “Project’), is pleased to provide an update regarding mining operations at Rukwa and the status of discussions with a potential strategic partner (the “Strategic Partner”) for the Project.
Following the receipt of gross proceeds from the £700,000 capital raise, announced on 23 January 2020, progress has been made at the Project site, including:
- Reinstatement of an on-site operational advisor with extensive coal experience and historic involvement in the Project;
- A detailed review and assessment of the wash plant has been completed with minor plant modifications being made. The wash plant is now operating again and continuous production is targeted for early March 2020;
- Critical spares including new belts have been ordered which are expected to reduce any future downtime;
- A stockpile of approximately 6,000 tonnes of unwashed run of mine (“ROM”) coal, which was mined from the southern pit at Rukwa,has been established adjacent to the wash plant; and
- The region is experiencing one of its wettest “rainy” seasons in many years. Accordingly, as the Directors believe that all economic coal has now been recovered from the southern pit, equipment will shortly be relocated to the northern pit and mining and hauling activities will be undertaken during periods of dryer weather. Based on the Company’s previous experiences, the rainy season is expected to end in late April.
Update Re Potential Strategic Partner
On the 11 December 2019 the Company announced it was in discussions with a potential strategic partner for the Project (the “Strategic Partner”). The Company confirms that these discussions are progressing and a non-binding heads of terms has been agreed with the Strategic Partner covering a potential asset-level loan, a potential coal mining agreement and a potential coal marketing agreement. The Strategic Partner recently visited the Project and is now conducting due diligence on Edenville’s operations. Whilst there is no guarantee that this period of due diligence will lead to a successful outcome for the Company, the Board is encouraged by the progress that has been made to date and looks forward to providing further updates regarding the Strategic Partner as appropriate.
Alistair Muir, CEO of Edenville, commented: “We are encouraged by the progress we have made since the receipt of funds, focusing firstly on re-establishing the workforce and secondly making essential modifications to the wash plant, including the delivery of a critical spares inventory and establishing the interim ROM coal stockpile. We intend to re-establish continuous production at Rukwa, as the weather conditions allow, and look forward to providing further updates regarding progress as appropriate.”
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.