AMN - BOTSWANA: Cradle Arc begins trading on AIM

The African-focused gold and copper mining company Cradle Arc, formerly Alecto Minerals, has begun trading shares on AIM. The primary asset is the Mowana Copper Project in Botswana, in which it holds 60%.

As part of the admission process, the gold and copper mining company raised £5.65 million before expenses, which comprised £3.25 million in pre-IPO funding.

Mowana was acquired on attractive terms via a transaction originally agreed in December 2016 when the copper price was approximately US$2.5/pound. Since then the copper price has increased by approximately 25% to about $3.10/pound.

More than $170 million of capital was historically invested by previous operators at Mowana, which was in production between 2008 and 2015 before ceasing operations at a time of low copper prices and following operating challenges now addressed through a revised mine plan.

Production restarted in March 2017 and Cradle Arc is ramping up to the base case nameplate production rate of approximately 12,000 tonnes/annum of copper in concentrate.

This involves processing at a throughput rate of 1.2 million tonnes and mining at a grade of 1.16% copper.

The company intends to undertake a low capex expansion option to increase production to approximately 22,000 tonnes of copper in concentrate through installation of a Dense Media Separation (DMS) pre-concentration process.

This is expected to increase throughput to approximately 2.6 million tonnes with reduced cash costs, delivering an increased NPV of up to US$245 million.

“The central pillar of our portfolio is Mowana, an established copper mine in Botswana, which is in production," said Cradle Arc CEO Kevin van Wouw.

"Our plans to expand and optimise Mowana, primarily through the implementation of a DMS pre-concentration process, considerably improve the economics of this asset and can potentially raise the total project NPV significantly.

"In addition to the producing Mowana mine, there is significant additional upside potential from the exploration opportunities open to us in the region and exciting opportunities across our wider portfolio.”

The company also has the Matala Gold Project in Zambia for which it has delivered a feasibility study, identified additional gold ounces and secured a Design, Build and Operate (‘DBO’) contract. It is now seeking financing.

Cradle Arc also has joint venture projects in Mali.

http://cradlearc.com/