Why Black Rock Mining Shares Are Up Today (ASX:BKT)
Black Rock Mining Ltd [ASX:BKT] shares are up today by close to 16%. At time of writing, shares are trading at $0.044, up from $0.038 on Friday.
Black Rock Mining is an ASX listed company focused on developing their Mahenge graphite project in Tanzania, of which they own 100%. The project is located in the Ulanga district, around 250km north from Mozambique’s border and close to rail and the Dar Es Salaam port.
Graphite is commonly used for pencils, but also lubricants and lithium-ion batteries for electric vehicles.
Why did Black Rock Mining shares go up today?
The company announced that its Tanzanian-based consultant had completed field activities in its Mahenge Project Resettlement Action Plan (RAP). The RAP is a process used to assess land and property values and support the relocation of people and properties.
The company has so far recorded a 98% acceptance rate with the remainder recorded in detail and looking to find a resolution according to IFC standards and the Tanzanian law. The resettlement process for the Mahenge project includes areas associated with Mdindo, Kisewe, Nawenge and Makanga villages.
Managing Director and CEO, John de Vries said:
‘A successful RAP further differentiates Mahenge’s brand of clean and green graphite, to now include socially responsible graphite.
‘In achieving this milestone, we have applied the same philosophy used in our engineering work, and that is a very disciplined approach with an overriding mindset to “get it right”. The very high acceptance rate is testament to the thoroughness and diligence of our Tanzanian management team and our consultants.
‘Once the RAP process is completed, we have crystallised project compensation value. The current estimate is consistent with the projected capital cost estimated in the July 2019 eDFS.’
According to the Mahenge Graphite Project’s enhanced Definitive Feasibility Study (eDFS), the project should create at least 970 full time jobs for Tanzanian citizens and contribute an estimated US$3.6 billion to the country’s economy in the 26 years the project will last.
What could happen next?
As of 31 December 2019, the company had cash reserves of $2.2 million and no debt. They also had no profits at the beginning stages of setting up the project.
With the world suffering the effects of the COVID-19 pandemic, it could put a dent in the demand for electric vehicles.
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