Project Finance Update

Armadale Capital Plc / Index: AIM / Epic: ACP / Sector: Investment Company

15 June 2020

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

Project Finance Update

Armadale Capital plc (LON: ACP), the AIM quoted investment group focused on natural resource projects in Africa, is pleased to report on progress with respect to project finance initiatives ahead of construction for Phase 1 of its 80,000 tpa nameplate capacity Mahenge Liandu Graphite Project (‘Mahenge Liandu’ or the ‘Project’) located in the world-class Mahenge Graphite province in Tanzania.

Following on from the results of its updated Feasibility Study delivered on 5 June 2020, the Company announces that it is now under NDA with two separate parties with the aim of advancing project level funding discussions with a view to bringing in an investment partner to progress through to mine construction.

As part of specific workstreams running concurrent to the recently delivered DFS, and in increasing intensity since its completion, Armadale and its technical and financial advisors have been engaging with a number of potential strategic investors or possible joint venture partners.

The interest from parties thus far ranges from potential small to medium size project development funding at an ‘investor’ level from reputable Private Equity Mining specialists, through to possible Engineering, Procurement and Construction Management (EPCM) partnerships with internationally recognised construction management and contracting groups.

Due diligence from certain parties is progressing well and the Company is in the process of helping all parties with detailed evaluations of the technical and financial aspects of Mahenge Liandu with a view to progressing to a potential partnership to progress to mine development and production.

In addition, the Company is also advancing separate discussions with a number of Asian parties and hopes to provide further announcements with respect to further progress on development funding in the near-term.

Armadale Chairman, Nick Johansen, commented:

“Following the delivery of last week’s updated DFS, which underscored the exceptional potential of the Mahenge Liandu Graphite Project, we have continued working to our stated plan of pursuing multiple workstreams to fast-track development. Indeed, it is a testament to the highly compelling project economics that potential development funding interest is so strong at this early stage.

“It is also encouraging to note the level of funding interest in other graphite development projects in the Mahenge area which also share many of the attractive characteristics of our project. For Armadale, finalising an agreement with a potential strategic investor or joint venture partner will represent an extremely important milestone for Armadale and we are fully committed to advancing these discussions whilst also continuing to progress workstreams in relation to Detailed Design Engineering, and the finalisation of the Company’s application for a full Mining Licence.

“Armadale has delivered a number of key value accretive milestones in recent months and we look forward to maintaining this momentum in the near term in order to continue to build value for shareholders.”

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’s primary focus is the Mahenge Liandu graphite project a long-life low-cost graphite development project in south-east Tanzania. Mahenge Liandu is located in a highly prospective region and is projected to produce 109,000 tonnes of large flake high-purity graphite per annum. The Project has demonstrated robust economics with headline figures including a pre-tax NPV of US$430m and IRR of 91%. An updated DFS produced in June 2020 forecasted pre-tax cashflow of US$985m to be generated from an initial 15 year mine life, utilising just 25% of the resource. The Resource remains open in multiple directions offering significant further upside.

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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