Kibaran Resources (ASX:KNL) is continuing its negotiations to finalise a binding agreement with Richland Resources' (LON:TNZ) subsidiary TanzaniteOne Mining and Tanzania's State Mining Corporation STAMICO to consolidate graphite assets at Merelani.
Under the original Memorandum of Understanding all parties agreed to an exclusivity period and an extension to this has been signed which will allow the agreement to be finalised.
The Merelani graphite mine represents the largest historical production of graphite in East Africa, with only a small part of the deposit mined prior to closure.
Its acquisition is part of Kibaran's move to build a strategic graphite province in Tanzania.
The last shipment of remaining stockpiled concentrate was in 1998, and included 99% carbon that was produced through natural attrition.
It is expected a number of groups will be seeking to secure supply from the Merelani Graphite Province given its premium quality and prominence in the past.
Mahenge Graphite Project
Kibaran has also been making giant strides at its Epanko deposit.
Ongoing drilling continues to encounter large flake graphite that is consistent with previous drilling results.
The Epanko deposit is globally the only graphite occurrence being explored or evaluated to date by any stock exchange listed company that has attracted a binding offtake and sales agreement.
The agreement was advanced with the support of a development bank, with the view for potential debt funding for the future development of Epanko.
Independent geological group CSA Global have estimated an Exploration Target of between 60Mt and 200Mt of graphitic schist at between 9% and 12% total graphitic carbon within the Merelani Prospect.
Kibaran's Merelani-Arusha Graphite Project consists of seven tenements and covers an area of 973.4 square kilometres about 15 kilometres east of the historic Merelani graphite mine.
Instrumental in Kibaran's strategy of creating a strategic graphite province in Tanzania is the agreement with Richland to consolidate their respective graphite assets in a joint venture.
As an executed agreement with Richland Resources beckons, there is further upside in the Kibaran share price in tune with graphite company listed peers.
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