Alecto Minerals plc / EPIC: ALO / Market: AIM / Sector: Mining

9 June 2017

Alecto Minerals plc ("Alecto" or the "Company")

Update re Mowana, operations and financial position

Director appointment

Alecto Minerals plc (AIM: ALO), the African focused gold exploration and development company, is pleased to announce an update on progress on the acquisition of the Mowana copper mine ("Mowana"), existing operations and the Group's finances.  

The acquisition of Cradle Arc Investments (Pty) Limited ("Cradle Arc"), which owns Mowana through its subsidiary Leboam Holdings Limited ("Leboam") (the "Acquisition"), constitutes a reverse takeover under the AIM Rules for Companies.  Accordingly, the Acquisition requires Alecto to publish an admission document and is conditional, inter alia, on shareholder approval.  Over the past six months, the Company has conducted extensive technical, financial and legal due diligence on Cradle Arc, Leboam and Mowana, the results of which will be reflected in the admission document as appropriate.  The due diligence phase is nearly at an end and the Company expects to commence marketing an equity fundraise shortly and to publish the admission document towards the end of June 2017. 

The Mowana mine returned to production in March 2017 and is expected to ramp up to 100,000 tonnes of ore processed this month with 3,286 tonnes of copper concentrate produced.  Working capital in the ramp up phase has been provided by Alecto and Fujax Minerals and Energy Limited, Leboam's offtake partner.

Alecto has raised, in aggregate, £1.8 million in 2017 to date through the issue of convertible loan notes.  The majority of this funding has been lent to Leboam.  Alecto has continued to develop its gold asset portfolio, in particular Zambia, but has focussed on minimising corporate costs in the run up to completing the Acquisition.  Subsequent to the issue of the further convertible loan notes, announced on 7 June 2017, and after making further loan payments to Leboam, the Company currently has cash balances of approximately £140,000, which the directors believe is sufficient to cover expected corporate costs through to completion of the Acquisition on the current anticipated timetable.  However, in the event that the Acquisition is delayed or does not complete, the Company would need to raise additional funds in July 2017 in order to continue as a going concern in light of its current status as an exploration and development business without any income generating production assets.  Shareholders should note, however, that the directors have a high degree of confidence that the Acquisition will complete and will be a success, subject to completion of the requisite fundraising and shareholder approval.

Director Appointment

Alecto is also pleased to announce the appointment of Roger Williams to the Board of the Company as a Non-Executive Director with immediate effect.

Roger is a Chartered Accountant with over 20 years' international experience in mining finance and an honours degree in French and Spanish.  He was previously CFO of Randgold Resources Limited and part of the management team that transformed Randgold Resources from an exploration and development company into a major gold producer. He then went on to become CFO of JSE-listed AECI Limited. His other experience includes directorships and interim executive appointments with various mining and mining services companies.  Mr Williams is currently a Non-Executive Director of Sylvania Platinum Limited and interim Commercial Executive for Digby Wells and Associates, an environmental and social consultancy to the resources sector in Africa.

Additional Information on Mr Roger Williams

The following additional information is provided in accordance with paragraph (g) of Schedule Two to the AIM Rules for Companies:

Roger Alyn Williams, aged 53

As disclosed above, Mr Williams was a Non-Executive Director of Shaft Sinkers Holdings plc, resigning in August 2014, which entered into a creditors' voluntary liquidation in June 2015.

As disclosed above, Mr Williams was a Non-Executive Director of Taurus Gold Limited, a privately owned exploration and development company which entered into a compulsory liquidation in October 2016.

There is no other information that is required to be disclosed pursuant to paragraph (g) of Schedule Two to the AIM Rules for Companies.

** ENDS **

For further information please visit www.alectominerals.com, follow us on Twitter @AlectoMinerals, or contact:

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014.

Notes to editors:

Alecto Minerals plc is an African focused, copper and gold exploration and development company quoted on AIM, with a prospective copper project in Botswana in production, gold exploration projects in Mali, Burkina Faso and Mauritania and a development project with near-term gold production in Zambia.

In Botswana, the Company is, subject, inter alia, to funding and shareholder approval, intending to acquire a 60% interest in the Mowana Copper Mine, a producing copper mine and plant.  Alecto has also agreed a management contract for Mowana with its partners and will receive management fees equal to 1.5% of revenue.

In Zambia, the historical Matala and Dunrobin gold mines have, in aggregate, a 760,000oz Au JORC Code compliant resource estimate in the Measured, Indicated and Inferred categories at an average grade of 2.3g/t Au.  The Company intends to bring Matala into low-cost production in the near to mid-term.

In Mali, the Company has secured a number of joint-venture agreements, in-line with its strategy to retain exposure to the value in its African gold exploration portfolio for little or no cost; the Kossanto East project, which has an inferred JORC Code compliant resource estimate of 6.72Mt grading at 1.14g/t Au for an aggregate of 247,000 oz Au with a cut-off grade of 0.5g/t Au, is under a joint venture agreement with Ashanti Gold Corp; the Kossanto West Project is under a joint venture with Randgold Resources Limited; and the 250 sq. km. Karan gold project in southern Mali is under joint venture with Cora Gold Limited.

Alecto also owns the Kerboulé Project, located in the highly prospective Birrimian-age Djibo gold belt in northern Burkina Faso, as well as the wholly owned Wad Amour IOCG Project in Mauritania which is at an exploration stage.

Accordingly, the Company has a strong, diversified project portfolio with exciting exploration upside potential.