Shareholders of Savannah Resources Plc (LON: SAV) have seen their shares jump after the firm announced progress in their Mozambique operations.
Savannah Resources Plc is a multi-commodity development company focused on building cash generative and profitable mining operations. The firm has operations in Portugal, Oman and Mozambique.
Shares of Savannah Rsources jumped 2.33% to 2p on Monday afternoon. 9/12/19 14:26BST.
The firm said the minister of Mineral Resources & Energy has issued Mining Licence 9735C to its subsidiary Matilda Minerals Lda. The licence covers 11,948 hectares. It is valid to April 2044 and includes a 25-year extension option.
The company operates the Mutamba project in a joint venture with FTSE100 listed Rio Tinto (LON: RIO).
Savannah’s partner Rio Tinto, hit news headlines last week as the firm gave an update to shareholders on its Richards Bay operations being unsafe.
Additionally, in November Rio Tinto saw its shares spike following a pledge to take part and underwrite a fundraise by invest Energy Resources of Australia (ASX: ERA).
The licence is the first of three permits to be issued which will allow the full tenement permitting of Mutamba.
Savannah currently holds a 20% interest in the Mutamba project but can increase its stake to 35% upon delivery of the a pre-feasibility study and finally to 51% upon delivery of a feasibility study.
The project contains an indicated and inferred mineral resource of 4.4 billion tonnes, grading 3.9% total heavy minerals.
David Archer, Savannah’s chief executive, said: “We are delighted with the issue of the first concession by the government of Mozambique, and now look forward to the issue of the remaining two mining licences, 9229CC and 9228C. When combined, these three concessions contain an indicated and inferred mineral resource of 4.4 [billion tonnes] at 3.9% total heavy minerals; this makes Mutamba one of the most attractive undeveloped mineral sands deposits in the world.”
“Our focus is now on progressing the pre-feasibility study at Mutamba towards completion, which, upon delivery, will trigger the increase in our interest in the Project from 20% to 35%,” Archer added.
This has been a busy week for the mining sector, and competitor Centamin have been involved in a takeover deal proposed by Endeavour Mining. This morning, shareholders got an update that Centamin had unanimously rejected the approach which saw its shares in green.
