Armadale Capital Plc (‘Armadale’ or ‘the Company’)

Initial Metallurgical Test-work Results

Armadale, the AIM quoted investment company focused on natural resource projects in Africa, is pleased to announce the receipt of the first phase of metallurgical test-work results from a bulk sample from a test pit on the Mahenge Liandu graphite project in Tanzania (‘Mahenge Liandu’ or the ‘Project’). The sample produced high concentrate grades of up to 99.1% total graphitic carbon (‘TGC’), without the use of toxic industrial chemicals. Furthermore flake distribution was also reported with 61% of flake size measured in the Super Jumbo, Jumbo and Large flake categories.

Highlights of the metallurgical results:

• Metallurgical test-work on a total 10kg sample taken from a test pit within the current resource area of the Project produced high-grade concentrate of up to 99.1% TGC for the large size fraction.
• Flake distribution was also reported with 61% of flake size measured in the Super Jumbo, Jumbo and Large flake categories
• Importantly, no toxic industrial chemicals were used to produce the concentrate and the graphite was recovered via an environmentally friendly, low cost crushing and flotation process.
• Multi element analysis showed low levels of potentially deleterious elements within the sample.
• Concentrate samples will be sent to a German metallurgical laboratory with the aim of producing concentrates suitable for further processing into spherical graphite, which is used in battery manufacturing.
• Results strengthen recently defined maiden JORC compliant inferred mineral resource estimate of 40.9Mt @ 9.41% TGC, which includes at least 32Mt at an average grade of 10.47% TGC.

William Frewen, Chairman of Armadale said, “Having produced a graphite concentrate at 99.1% TGC via environmentally friendly, low cost extraction processes, these metallurgical results mark a key step in proving what we believe to be the commercial viability of Mahenge Liandu. The high purity achieved from the first test work programme and outstanding flake distribution is a tremendous outcome. These results coupled with the large tonnage high grade Resource is highly encouraging and Armadale is fully committed to an ongoing work programme to confirm the potential of the deposit to produce commercial grade graphite concentrates suitable to produce both spherical and expandable graphite. Accordingly, the Board is moving ahead with marketing plans, with the emphasis on prospective European and Chinese customers initially. Within the next few months Armadale’s team should be in a position to start sending prospective customers samples of graphite concentrate for independent testing.

The results of the floatation test-work showed excellent flake size distribution with 28.1% in the jumbo and super jumbo categories. A further 32.9% is in the large size fraction where purity of 99.1% TGC was returned. All size fractions above 25 microns returns +97% TGC with a weighted average TGC grade across all size fractions of 98.5% TGC. The test work was conducted at ALS laboratories In Perth Australia. The results on all size fractions are shown in table 1 below;

Table 1 Flake size and grade distribution for Mahenge Liandu Graphite Test Pit sample

William Frewen, Chairman of Armadale added

“Looking at the wider market dynamics, according to industry experts, Benchmark Mineral Intelligence (‘BMI’), the outlook for spherical graphite, which is used in battery manufacturing, remains robust. For instance, Hitachi Chem (the second largest anode producer globally) has announced plans to increase spherical graphite production four-fold to 100,000 tpa by 2020, while CATL (one of China’s largest battery manufacturers) is targeting capacity to reach 50GWh within 3-4 years. In addition, BMI believes that growing demand for fire retardants is also propelling demand for expandable graphite. With favourable pricing dynamics, a significant high-grade resource and potential for commercially attractive extraction routes, we are committed to advancing Mahenge Liandu at an accelerated pace.”

Conclusion

These result of the first test work completed to date metallurgical results demonstrate that Mahenge Liandu can produce a high grade concentrate with a simple crushing and floatation process. Further test work is ongoing into the potential for the deposit to produce commercial grade graphite concentrates suitable for use in the production of spherical and expandable graphite. These developments are timely given that demand for both these graphite products continues to gain momentum.

The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.

**ENDS**

Notes

Armadale Capital Plc is focused on investing in and developing a portfolio of investments, targeting the natural resources and/or infrastructure sectors in Africa. The Company, led by a team with operational experience and a strong track record in Africa, has a strategy of identifying high growth businesses where it can take an active role in their advancement.

The Company owns the Mahenge Liandu graphite project in south-east Tanzania, which is now its main focus. The Project is located in a highly prospective region with a high-grade JORC compliant inferred mineral resource estimate of 40.9Mt @ 9.41% TGC. At least 32Mt of this resource has an average grade of 10.47% TGC, one of the largest high-grade resources in Tanzania, and work to date has demonstrated Mahenge Liandu’s potential as a commercially viable deposit with significant tonnage, high-grade coarse flake and near surface mineralisation (implying a low strip ratio) contained within one contiguous ore body.

Other assets Armadale has an interest in include the Mpokoto Gold project in the Democratic Republic of Congo and a portfolio of quoted investments.

More information can be found on the website www.armadalecapitalplc.com

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