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Mining Capital
EPIC: MKA
Market: LSE:MKA
TSX-V:MKA
52-week High/Low: 12.50p / 5.75p
Sector: Mining
Market Cap: 9.79M
Website: www.mkango.ca

Mkango Resources Ltd. (TSX-V / AIM: MKA) is a Canadian dual TSX-V and AIM listed mineral exploration and development company focused on rare earth elements (REE) and associated minerals in the Republic of Malawi, a country whose hospitable people have earned it a reputation as "the warm heart of Africa". It holds through its wholly owned subsidiary Lancaster Exploration Limited a 100%...

Mkango Resources Ltd

www.mkango.ca

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Big picture - Why invest in Mkango Resources Ltd

Mkango Resources Ltd Snapshot

MISSION STATEMENT

The Company's mission is to spearhead the development of mining in Malawi, to provide maximum shareholder value and to implement meaningful and successful social responsibility programs.

Company principles include:
Targeted exploration and development with a strong focus on assessment of commercial implications and management of risk
Focus on building long term and sustainable stakeholder relationships in Malawi and globally
Cultivate in-house technical excellence coupled with support of cost effective and synergistic research and development programs
Seek to become the partner of choice for exploration, research and project development focused on rare earth elements and the Republic of Malawi
Empowerment of local and international staff through training and other initiatives, and fostering of a diverse workplace culture

 

SONGWE HILL

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  Location
Songwe Hill is located in southeastern Malawi, between Lake Chilwa and the Mulanje Massif. It lies within exclusive prospecting licence EPL 0284/10 which Mkango refers to as the 'Phalombe Licence'. The EPL lies entirely within the Southern Region of Malawi and Songwe Hill is within the Phalombe administrative district. It is approximately 70km from the former capital, Zomba and approximately 90km from the commercial centre of Blantyre (which has an international airport and a railhead). The national highway S145 passes within 15km of Songwe Hill and is being upgraded. Secondary gravel and dirt roads provide vehicle access to the exploration camp.

Location of the Songwe Hill REE Project

The deposit lies on the north-facing slopes of Songwe Hill, a steep-sided conical hill with a diameter of approximately 800m that rises to a summit elevation of 990m. Songwe Hill abuts onto the slopes of the adjacent and larger Mauze Hill which rises above the alluvial plains south of Lake Chilwa and straddles the border with Mozambique. The slopes of Songwe Hill are densely vegetated with elephant grass following the rainy season but, in other times of the year, vegetation does not hinder access.

Climate
The Songwe Hill area has a sub-tropical climate. Maximum monthly rainfall is between 125cm and 218cm during the rainy season of December to March. The project area is warm from September to April with average daytime maximum temperature of around 26°C. The monthly average temperature ranges from 22°C in August to 27°C in December. The monthly minimum average temperature ranges from 11.4°C in August to almost 21°C in October. The climatic conditions are not expected to impact on the operation of the proposed mine, which has been planned to operate all year round.

Geology and mineralisation
Songwe Hill is interpreted as a volcanic vent that is expressed as a steep-sided hill approximately 800m in diameter. Information from surface mapping and drill core indicates that the vent complex consists of a multi-phase intrusion characterised by diverse carbonatites and breccias. The carbonatite is best exposed along the north-eastern slope of Songwe Hill. The vent complex cuts the western end of the large Mauze nepheline syenite intrusion, but the external contacts on the western and northwestern sides of the vent are hidden beneath recent surficial eluvial deposits.

The principal lithologies that comprise the Songwe Hill vent complex are carbonatite, fenite and breccia. The carbonatites are dominantly grey calcic carbonatites, although subordinate ferro-carbonatites are present. The fenites comprise dominantly K-feldspar rocks and appear to form an aureole around the carbonatite. They are interpreted to have formed through metasomatism related to the carbonatite intrusion. The breccias range from clearly abraded pebble-sized fragments (pebble dykes) to angular blocks that are metres in diameter and include significant volumes of breccia in which the fragments appear to have undergone little or no movement.

The principal zone of REE mineralisation outcrops along the northeastern slope of Songwe Hill. REE mineralisation is present in carbonatites, fenites and breccias, which are exposed intermittently over a surface area of approximately 350m by 100m. The REE mineralisation is untested to the northeast and southwest beyond the limits of the present drilling and below the deepest vertical intersection of approximately 350m below the surface of Songwe Hill and there is additional regional exploration potential in the Songwe and other carbonatites. The mineralised body is interpreted to be a carbonatite plug with essentially sub-vertical margins. In plan view, it is elongated in a northeast-southwest direction.

The dominant REE-bearing minerals are synchysite and apatite. The apatite is anomalously enriched in the HREO's compared to apatites in most carbonatite deposits. The REE mineralisation is closely associated with strontianite and baryte and is interpreted to have formed through sub-solidus hydrothermal alteration following the carbonatite intrusion.

Project Overview
Mkango completed a Pre-Feasibility Study for the Songwe Hill Project in September 2014, which was subsequently updated in November 2015. The Pre-Feasibility Study is based on a conventional open pit operation using contract mining, a mine life of 18 years and is focused only on the Probable Mineral Reserve Estimate.

The Songwe Hill Project features broad zones of outcropping REE mineralisation on the northern slopes of a steep sided hill. The annual processing capacity was assumed at 500,000 tonnes per year of ore with a view to producing an average of approximately 2,840 tonnes of REO in mixed chemical concentrate per year with a large proportion of the cerium removed during the hydrometallurgical process. Cerium is currently considered to have challenging market fundamentals and, under Mkango's current strategy to produce a concentrate, there is a strong economic rationale to remove as much as possible of the cerium from the final concentrate.

THAMBANI

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  The Thambani exploration licence, located in the Mwanza District, was originally granted by the Malawi Minister of Natural Resources, Energy and Environment on September 10, 2010 in respect of an area of 468km2. In September 2013, September 2015 and September 2017 the Government of Malawi granted further two year renewals for the licence. At the second renewal the Company requested a reduction in the licence size to the current area of 136.9km2 .

Mkango's exploration activities to date include acquisition of Landsat7 and ASTER satellite imagery for the licence area, systematic ground radiometric surveys to confirm and detail previously-known airborne anomalies, reconnaissance geological mapping and litho-geochemical sampling programs. The work has identified a number of potential uranium and associated Nb-Ta targets over the Thambani Massif, which is mainly composed of nepheline-bearing syenite gneiss, forming two prominent ridges known as Thambani East Ridge and West Ridge.

A systematic ground radiometric survey completed by Mkango previously revealed two distinct uranium anomalies occurring across the Thambani East and West Ridges: A strong uranium anomaly, measuring approximately 3km by 1.5km, occurs along the length of the Thambani East ridge, with a north-south trend, and a second uranium anomaly, measuring approximately 1.5km by 0.4km, occurring on the West Ridge along the western contact of the nepheline-bearing syenite body with the biotite-hornblende gneisses. 

Mkango completed a trenching program across the Thambani Massif primarily focused on two sites of historical uranium exploration, known as the Chikoleka and Little Ngona targets. An initial set of 9 trenches, selected on the basis of anomalous ground radiometric results, have been re-examined and geochemically sampled across profiles from soil/overburden into bedrock.

The first set of assay results of 142 soil and rock chip samples returned variably anomalous U, Nb and Ta values in most trenches, ranging up to 4.70 per cent. U308, 3.25 per cent. Nb2O5 in soil and up to 0.42 per cent. U308, 0.78 per cent. Nb2O5 and 972 ppm Ta2O5 in rock chips, notably higher than results from the 2013 reconnaissance surface geochemical sampling program. Results associated with the 10 best U308 assays are summarized in Table 1.

Preliminary mineralogical studies carried out on six rock samples from the Little Ngona River and Chikoleka targets, using SEM at the Natural History Museum London, indicate that pyrochlore group minerals, mainly betafite, are the principal carriers of U, Nb and Ta for these samples.

 

DIRECTORS

Mr Derek Linfield
Non-Executive Chairman

Mr Linfield is a legal consultant at Fasken and former Managing Partner of Stikeman Elliott (London) LLP, the London office of Canadian law firm Stikeman Elliott LLP between 2005 and 2015. He practiced as a Canadian lawyer in London for 20 years, where he focused on cross-border financings and M&A in the mining and oil & gas sectors, including taking internationally managed companies to the TSX and the TSX-V as well as Canadian companies to the London Stock Exchange. A former educator, Mr Linfield holds BA(Ed) and BSc degrees from Memorial University of Newfoundland as well as LLB and MBA degrees from McGill University. He is a Director of MUN (UK) Limited, the UK campus of Memorial 32 University of Newfoundland, as well as immediate past chairman of Canada Day in London and the Foundation for Canadian Studies in the UK as well as a former Director of the Canada UK Chamber of Commerce where he is now an advisor to the Board.

Mr William Dawes
Chief Executive Officer and Co-Founder

Mr Dawes is a graduate of Bristol University (BSc Geology) and Royal School of Mines, Imperial College, London (MSc Mineral Exploration with distinction). Having trained as a geologist in South Africa, he worked as a mining analyst based in London and then for Rio Tinto's exploration division. Subsequently, he gained significant global mining transaction experience in the metals and mining team of Robert Fleming & Co, Chase Manhattan Bank and JPMorgan. Mr Dawes is a founding Director of Mkango and Mkango's Major Shareholder, Leominex, and since 2004 has been involved in the exploration and evaluation of a variety of projects throughout Central Asia, the Middle East and Africa. He has 15 years' experience in exploration and business development and 9 years in mining finance, mergers and acquisitions. He is a Fellow of the Geological Society, a Professional Member of the Institute of Materials, Minerals and Mining and holds the Chartered Financial Analyst designation.

Mr Alexander Lemon
President and Co-Founder

Mr Lemon is a graduate of the Royal School of Mines, Imperial College, London (MSc Dic in Mineral Exploration) and Oxford Brookes University (BSc Geological Sciences). He has 24 years' experience in mineral exploration and business development. Mr Lemon is a founding Director and President of Mkango and Mkango's major Shareholder, Leominex. From 1994 to 2001 was the Managing Director of a gold mining company, which owned and operated a producing gold mine in Central Asia, where he gained extensive operating experience in emerging markets including government negotiations and project management. From 2001 to 2005, he worked for a family office, Allied Commercial Exporters as an investment adviser. Since 2005 has been involved in the exploration and evaluation of a variety of projects throughout Africa, Central Asia and Europe. He is a Fellow of the Geological Society, Fellow of the Geographical Society and a Member of the Southern African Institute of Mining & Metallurgy.

Mr Adrian Reynolds
Non-Executive Director

Mr Reynolds has an MSc in Geology, a Graduate Diploma of Mining Engineering and over 30 years' experience in the natural resources sector, including more than 15 years' experience with Randgold Resources Limited. At Randgold, he was part of the executive team that developed that company's original successful strategy whereby it grew from an exploration company to a very profitable mid-tier mining company. His key responsibilities included technical oversight of the mining operations including Feasibility studies, audits, compliance and evaluation of new opportunities. He was also a Director of Morila Ltd and Société des Mines de Loulo S.A. Mr Reynolds initially built his experience in both oil and coal exploration and then moved into deep level gold mining with Gencor Ltd in the Free State Goldfields. Joining Rand Mines Limited in 1985, he held positions in geological management in Rand Mines Limited and its successor Randgold & Exploration Company Limited. Mr Reynolds is currently an independent consultant and a Non-Executive Director of Geodrill Limited, was formerly Non-Executive Chairman of Digby Wells Environmental, one of the foremost mining environmental consultancies in Africa.

Ms. Susan Ann Muir
Non-Executive Director

Ms. Muir is a seasoned Investor Relations executive based in Toronto, and was previously Vice President, Investor Communications at Barrick following a series of increasingly senior roles since 2007. She was, most recently, Vice President, Investor Relations & Corporate Communications at Arizona Mining, which she joined in August, 2016. Prior to Barrick, Susan also has 25 years of experience analysing and covering large and small cap precious metals equities, respectively, for several major Canadian investment banks. Ms. Muir holds a Bachelor of Arts from Concordia University.

Ms. Sandra du Toit
Non-Executive Director

Ms. Du Toit has been with Standard Bank for over 10 years where, having previously been the Head of Corporate Finance for Mining, she now focuses on complex, cross-border African transactions in mining and metals, from an advisory, capital markets and funding perspective. Sandra started her career as an academic at the University of the Free State, lecturing on company law and tax law, before joining Johannesburg law firm Brink Cohen le Roux & Roodt. After graduating with an undergraduate degree in accounting and tax, and a Master's degree in law, she became involved in the mining industry, working first on the labour side of the business before moving on to the corporate and commercial end of practice.

Mr Shaun Treacy
Non-Executive Director


Mr Treacy is currently Chief Investment Officer for Arete Capital Partners, and was previously a senior investment banker with JPMorgan (head of Metals and Mining advisory for Europe, Middle East and Africa and Head of Natural Resources in Australia), Lehman Brothers (Global head of Metals and Mining), Nomura (Global Co-Head of Natural Resources and Power) and UBS (Co-Head of All Industries Group for Asia and Vice Chairman of the Global Metals and Mining Group) and worked as a corporate finance adviser at Coopers & Lybrand. Shaun has lived and worked in Australia, the United States, the United Kingdom and Hong Kong, holds a Bachelor of Commerce degree from the University of Queensland, a Graduate Diploma of Applied Finance & Investment, is an Associate of the Institute of Chartered Accountants in Australia and is a Member of the Australian Institute of Company Directors.

Office - Canada:
550 Burrard Street, Suite 2900
Vancouver, BC
V6C 0A3
Canada

P / F: +1 403 444 5979

Nominated Advisor and Co-Broker:
SP Angel Corporate Finance LLP
Prince Frederick House
35-39 Maddox Street
London
W1S 2PP

Co-Broker
Alternative Resource Capital
8 - 10 Hill Street
London, W1J 5NQ

Canadian Legal Counsel to the Company:
FASKEN
Bay Adelaide Centre,
333 Bay St #2400,
Toronto,
ON M5H 2T6,

English Solicitors to the Company:
FASKEN
125 Old Broad St,
London
EC2N 1AR

Auditor:
MNP LLP
Suite 2000, 330 5th Ave. S.W.
Calgary, AB
T2P 0L4

Canadian Registrars and Transfer Agent:
Computershare Trust Company of Canada
Suite 600
530-8th Avenue SW
Calgary
Alberta
TSP 3S8

UK Registrars and Transfer Agent:
Computershare Investor Services plc
The Pavillions
Bridgewater Road
Bristol
BS99 6ZZ

 

Dr Alan Woolley
Geologist and Mineralogist
Dr Alan Woolley, a research associate of the Natural History Museum London (NHM), is a world renowned carbonatite specialist who first worked in Malawi during the 1960s. Dr. Woolley has been a supportive advisor to the Mkango Resources team since 2010, assisting with the training and mentoring of local geologists and field team. Given his experience within the region and with the host deposit rock, his expertise and advisory work has aided in the diligent progression of the Songwe Hill project.

Dr Woolley first visited Malawi in 1964, under the auspices of a NERC Fellowship, spending three months investigating fenites associated with all the principal carbonatite occurrences. He conducted geological work across the Chilwa Alkaline Province; including the carbonatite centres of Chilwa Island and Kangankunde. He also worked in the Fort Lister Gap while examining alkaline centres SE of Lake Chilwa. Subsequent field work was undertaken on a further five occasions including spending a field season on the Mlanje Plateau. He has written sixteen papers on various aspects of the alkaline igneous rocks and carbonatites of the Chilwa Province, which he considers to be one of the most fascinating manifestations of alkaline rocks in the world.

Although Alan's principal research interest has been the Chilwa Province, he has also undertaken field work on alkaline rocks and carbonatites in at least another dozen countries.
Dr Scott Swinden, BSc, MSc
Geological Advisor
Dr Swinden is a graduate of Dalhousie University, and Memorial University of Newfoundland (Ph.D., Earth Sciences, 1988). He has extensive experience in both public and private sectors in mineral exploration, research and management. In 2010, Dr. Swinden founded Swinden Geoscience Consultants Ltd., providing geoscientific services and advice to the mineral exploration sector and policy support to the public sector. He is a specialist in the geology and geochemistry of rare earth elements and rare metals and has recent experience exploring for REE deposits in Namibia (where he was part of the discovery team for the Lofdal deposit) and Malawi. Dr. Swinden is a geological advisor for Mkango and co-authored the 2012 NI43-101 Technical Report.

Between 1970 and 1979 he explored for base metals, precious metals, and mineral fuels in a wide variety of geological environments in Canada and the US. Between 1979 and 1987, he worked as a research geologist and project leader for the Newfoundland Geological Survey and the Geological Survey of Canada, and then for nine years managed the Newfoundland Geological Survey's Mineral Deposits Section while also carrying out an extensive research program directed mainly at Appalachian mineral deposits. In 1996, he moved to Nova Scotia as Director of the Nova Scotia geological survey, and from 1998 to 2010 served as Executive Director of the Minerals and Energy Branch where he was the Senior government official responsible for minerals programs, policies and legislation in Nova Scotia.

Dr Swinden is a Fellow and former President of the Geological Association of Canada, a Fellow of the Canadian Institute of Mining, Metallurgy and Petroleum, a Fellow of the Society of Economic Geologists and a member of the Association of Professional Geoscientists of Nova Scotia. He is an adjunct faculty member in the Department of Earth Sciences at Dalhousie University in Halifax, Nova Scotia, where he provides teaching support in the area of economic geology.
 

 

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