Ncondezi Coal Co. Ltd, a coal exploration and development company with assets in the Tete Province in Mozambique, Southern Africa, has announced its admission to trading on AIM, the commencement of dealings in its shares on AIM, and the successful completion of a placing which raised gross proceeds of £35.6 million (US$ 52 million) for the company, before expenses.
Pursuant to the placing, the company has issued 28,956,454 million new shares of no par value at 123 pence each to a broad base of institutional and other investors. Based on the placing price, the market capitalisation of Ncondezi immediately following completion of the placing and the admission to AIM will be about £146 million.
Overview of Ncondezi
Ncondezi is a British Virgin Islands registered company that holds four prospecting and exploration licenses in the Tete Province of Western Mozambique. Following earlier exploration, the company has defined a JORC 1.8 billion t coal resource at Ncondezi, which comprises two of its licenses (804L and 805L).
The company plans to further explore these license areas to increase its overall coal resource, upgrade the current JORC resource and ultimately to develop mining operations producing thermal and, potentially, coking coal. Further test work is required to confirm this potential. SRK, on behalf of Ncondezi, recently completed a study on the Ncondezi project, which confirmed the economic and technical viability of a 37 year open pit mine, producing 10 million tpa of export quality thermal coal, commencing in the H2 of 2014.
The company’s assets are in the Zambezi coal basin in the Tete Province of northwestern Mozambique. The primary market for Ncondezi’s export thermal coal is expected to be India. Several international mining, steel and energy companies are making major investments to develop coal resources and reserves in Mozambique for the purpose of supplying international markets. The region’s infrastructure is also receiving substantial investment, associated with developments by Vale and Riversdale at their respective Moatize and Benga coal projects, which are expected to start production in late 2011.
The company intends to use the proceeds of the placing to conduct further exploration work and a fast-track bankable feasibility study, to be completed in the H2 of 2012, which will encompass further drilling and evaluation of the Ncondezi project. Social and environmental studies will also be undertaken in order to advance the Ncondezi project towards production.
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/10062010/ncondezi_coal_lists_on_aim_raising_us$_52_million_to_explore_licenses_in_mozambique/