Transcription of Finance News Network Interview with Mustang Resources Limited (ASX:MUS) Chief Operating Officer and Executive Director, Andrew Law Carolyn Herbert: Hello I’m Carolyn Herbert for the Finance News Network and joining me from Mustang Resources Limited
(ASX:MUS) is Executive Director, Andrew Law. Andrew welcome to FNN.
Andrew Law: Hi Carolyn, thanks very much for having me.
Carolyn Herbert: Could you start by introducing the Company to us?
Andrew Law: Mustang Resources is an ASX listed company, MUS is our ticker on the ASX. We are a diamond and graphite focused project and we have two projects. One being the diamonds in Mozambique, in fact both projects are in Mozambique. The Save River diamonds project is to the southeast in Mozambique and the graphite project is in the, I guess it’s becoming the world-renowned graphite province at the moment, with two significant other companies with resources there.
Carolyn Herbert: Looking at your diamond project in more detail. Where is it located and what does it contain?
Andrew Law: The Save River diamond project is to the east of Mozambique. It’s right alongside the border of Zimbabwe, and we had a theory that there were alluvial diamonds in that area. Mozambique has never had, it’s not known and never has found any diamonds. So we had this theory that these alluvial diamonds had actually washed out of Zimbabwe, the significant diamond fields in Zimbabwe and they’d washed out into our project area. And at the moment, we have found 18 diamonds, so we proved the theory that they’re all gem quality stones. We’ve proved the theory that there are diamonds in Mozambique.
Carolyn Herbert: What’s taking place onsite?
Andrew Law: Currently now that we’ve proved our theory, we’d actually structured our bulk-sampling program to achieve about 100 tonnes a day. We’re now in the process of stepping that bulk-sampling project up to a 1,000 tonnes a day. That expansion is being commissioned right now and probably the first week of September, we’ll actually be producing at that rate.
One of the other probably more significant pieces of equipment that we’ve purchased onsite, as originally we started off doing hand sorting of diamonds, now we’re going to a flow sort system, which is basically an automatic system. So we can speed up and get more accuracy of the diamonds that we’re actually recovering.
Carolyn Herbert: What are your next steps for the diamond project?
Andrew Law: The next steps for the Save River diamond project as I said, were the completion of the expansion that we’ve started, from 100 tonnes a day to a 1,000 tonnes a day. All the equipment is onsite at the moment; it’s being commissioned. So during the first week of September this year, we’ll be into full production at the 1,000 tonnes a day. Our objective and strategy there, is to open up the basement level of gravels and get to the bottom end of the terraces that we’ve been digging in.
Again, we believe those to be the jewellery boxes, or potentially where the jewellery boxes are. We plan to mine the bulk sample program at a 1,000 tonnes a day, for the next three or four months. That should give us a better scale of how big and potentially how big the project could actually be. Early next year, our plan then is to then work out exactly how far we should expand the project to, going to in terms of production size. That we’ll only know, once we’ve completed this test program.
Carolyn Herbert: Looking at the graphite project. Where is it located and what do you know about the mineralogy?
Andrew Law: The graphite project is located about 2,000 kilometres to the northeast of Maputo. It’s actually directly opposite the Port of Pemba, about 200 kilometres in. And that area, the Cabo Delgado, is becoming known as sort of the world’s graphite resources. You’ve got two significant companies there. One in Syrah Resources Limited
(ASX:SYR), they’ve got a resource of 1.3 billion tonnes at about 10 per cent TGC graphite. And you’ve got Triton Minerals Limited
(ASX:TON) resources also about 1.5 billion tonnes, around about 12 or 13 per cent TGCs.
Our project, we’ve actually got 66,000 hectares of licences in that area. We surround both Syrah and Triton, to the north of Triton and to the south of Syrah. At this early stage of the game, we’ve only drilled two RC holes in our project, to get a bit of a sighted on the potential graphite. And recently, we’ve just committed to the start of a SkyTEM program. SkyTEM’s an aeromagnetic geophysical system that’s going to fly over all of the leases and give us a bit of a picture, where potentially the graphite is. And probably a bit of the extent of the graphite leases.
The reason we’ve done that is primarily to get a better handle on exactly where the graphite is. And obviously to target potentially the better signature type of graphite, rather than over our 66,000 hectares is why, you can draw all over that, but we really want to target and have a focus target drilling program, which hopefully will commence in October this year.
Carolyn Herbert: Finally Andrew, investors in resources have had a tough time over the last couple of years. What makes Mustang Resources so compelling?
Andrew Law: We believe we offer the investors with the Save River diamond project; it’s a brand new project, as I said diamonds have never been discovered in Mozambique before. They’re all alluvial stones; they’re all gem quality stones. We haven’t at this point in time - we’ve proved the theory, but we haven’t been able to get down to the basement zone into those jewellery boxes, to actually prove exactly how many diamonds are in our properties. As I said, we’ve got 22,000 hectares.
We’ve only just touched the surface, there’s a tremendous amount of upside. As I said, these are jewellery quality stones and that’s what the market is really looking for.
Our Balama graphite project is in the northern part of Mozambique. We currently have 66,000 hectares of land tenure, so we’re the biggest landholder in that area. We just committed to starting off the SkyTEM. Once we do that, we’ll then start a drilling program. And most people know, from an investment point of view is once you start to put out a resource, a JORC compliant resource, which we’ll be attempting to do very early next year, that’s where there’s going to be significant upside for investors who are interested in the story.
Carolyn Herbert: Andrew Law, thank you for the introduction.
Andrew Law: Thank you very much Carolyn.
Ends
