Capital Metals PLC (AIM:CMET), a mineral sands company approaching mine development stage at the high-grade Eastern Minerals Project in Sri Lanka has announced its unaudited half-year results which showed it had a cash balance of $ 812,246 as of 30 September 2022.
During the period, the company released results of the auger drilling programme in April 2022 which delivered exceptionally high grades, and all results from surface to a maximum of only 3.5 m in depth – with an average depth of 1.5m – ended in mineralisation.
The results showed +30% Total Heavy Minerals (THM) and an average grade of 19.37% THM from 560 drill holes, compared to the existing JORC resource grade of 17.6%. Meanwhile, completion of the Development Study and Project Economics in May 2022 demonstrated robust economics with a base case NPV of $ 155 million and IRR of 56%.
The grant of the project's first two Industrial Mining Licences (IMLs) occurred in August 2022 but were subsequently purportedly temporarily suspended in December 2022 by the GSMB pending an investigation into the company's ownership structure, which Capital Metals has been advised is legally sound.
The company said it is in continued positive discussions with prospective offtaker and strategic partners with the objective that such parties will form a significant part of a future capex funding package.
It also highlighted continued work with local communities including sponsorship of educational, sporting and community cleaning initiatives.
In the half-year report, Capital Metals non-executive chairman Greg Martyr commented: "While our Board and local management team continues to monitor the economic and political developments in Sri Lanka, we are pleased to observe that Sri Lanka's economic situation appears to be improving and a normal operating environment in respect of fuel and other key supplies appears to have been restored.
"Undoubtedly, there is widespread support both within the Sri Lankan Government and local communities for the progression of the project and the benefits it will bring to all stakeholders."
He added: "In conclusion, considering the compelling market dynamics for our minerals, the advanced stage of our project, the attractive economics and the potential for further expansion of our high-grade resource, we believe Capital Metals represents an exceptional investment prospect."
Capital Metals also announced that Tavira Financial has been appointed as its sole broker with WH Ireland Ltd. no longer acting as the company's broker with immediate effect.
(Proactive investors)