JOHANNESBURG (miningweekly.com) – Aim- and AltX-listed Kibo Mining on Monday said its focus for the remainder of the year would continue to be on its flagship Rukwa coal-to-power project and its Haneti nickel project, both in Tanzania, as the company prepared to start a scoping study at the former and a work programme at the latter.

The exploration and development company stated that it had temporarily suspended work at its other projects in the country, namely the Lake Victoria, Morogoro and Pinewood projects.

Kibo indicated that its board’s focus over the past months had been on advancing the Rukwa project and implementing its joint venture (JV) with Brazilian conglomerate Votorantim Metaís Participações on the Haneti l project.

While Haneti remained funded under the Votorantim JV for the year and would not require further financing from Kibo, Rukwa would require further expenditure to allow for the completion of the scoping study. Kibo, therefore, indicated that, together with ongoing working capital requirements, the proceeds of a recent £780 000 capital raising would be applied primarily towards initiating the scoping study. 

Kibo stated that encouraging progress had been made during the first half of the year with respect to its engagements with the Tanzanian government and potential development partners regarding the development of a mine-mouth thermal coal power plant at Rukwa.

In March, a strong expression of support for the project by the Tanzanian government and the project’s inclusion as a strategic component of the country’s national energy strategy was announced.

The following month, a letter of intent from Korean government-owned multinational Korean East-West Power to participate in the project and the start of negotiations towards a formal JV agreement, were disclosed.

The Rukwa project contains a Joint Ore Reserves Committee-compliant resource of 109-million tons of thermal coal, 71-million tons of which is in the indicated category and 38-million tons in the inferred category. Kibo expected the proposed scoping study to quantify preliminary technical and economic parameters for a mining operation prior to completion of a feasibility study.

The results of the scoping study were expected to be available towards the end of the year.

Meanwhile, over the past two months, resources and procedures to support the company’s JV agreement with Votorantim had been put in place and the initial tranche of exploration funding for 2013 had been received.

Kibo indicated that a field exploration team was currently being mobilised to site and that operations would be in full progress by the second week of June. A detailed field exploration programme had been designed and agreed to between the company and Votorantim to apply the initial funding as efficiently as possible.

The key elements of the exploration programme included priority focus on those localities with elevated nickel of up to 13% and platinum-group metals (PGMs) of up to 2.3 g/t combined platinum and palladium within the previously identified the nickel-PGM-copper prospective Haneti-Itiso ultramafic belt.

Precedence would also be given to a 1 km diamond-drilling programme that was planned over the Mihanza, Mwaka, Kwahemu and Sanato Hills localities toward the end of 2013 or early in 2014.

Further, Kibo said its decision to relinquish about 18 649 km2 of its current licence interests, thereby reducing its total licence interests from about 37 000 km2 to 19 000 km2, would result in significant savings in licence fees and allow it to focus its resources on priority areas.

“We are pleased with the fact that the company achieved all its stated strategic objectives for the first six months of 2013 and that we are also on course towards successfully achieving those set for the last six months of 2013.

“In this regard, Kibo is particularly excited about finalising definitive agreements with preferred Korean partner EWP and advancing the Rukwa coal-to-power project beyond the scoping study stage,” CEO Louis Coetzee said.