Highlights

• Black Canyon completed a placement to raise AU$0.85 million.
• A comprehensive heritage survey was conducted across the high-grade Wandanya manganese targets.
• Drilling plans finalised for Wandanya, with drilling scheduled for September quarter.
• Recent metallurgical testwork on KR1 and KR2 samples produced high manganese concentrate grades of 31.8% and 31.3% Mn.
• The Scoping Study for KR1 and KR2 projects confirmed impressive financial returns, including a pre-tax NPV of AU$340 million and pre-tax IRR of 70%.

Black Canyon’s (ASX:BCA) June quarter saw significant advancements in its manganese projects, highlighted by ongoing exploration and development activities. The company concluded a placement of AU$0.85 million to support these efforts.

Looking ahead to the September 2024 quarter, Black Canyon plans to continue its exploration and development work, including environmental surveys, drilling, and advancing discussions for a high-purity manganese sulfate facility.

The company reported a cash balance of AU$702k at the quarter end.

High-grade Wandanya manganese targets

During the June quarter, a comprehensive heritage survey was completed across the company’s high-grade Wandanya manganese targets. Drilling plans have been finalised to follow up on promising high-grade rock chip samples, which returnedassays of 58.5%, 57.9%, 57.8%, and 53.3% Mn.

The upcoming drilling program, scheduled for the September 2024 quarter, aims to evaluate and potentially expand these high-grade manganese resources.

Promising Results from Metallurgical Testwork

Recent metallurgical testwork on KR1 and KR2 samples from the Balfour Manganese Field yielded positive results, with Dense Media Separation (DMS) achieving manganese (Mn) concentrate grades of 31.8% Mn and 31.3% Mn, respectively.

These samples were processed using larger-scale DMS equipment designed to simulate the beneficiation techniques employed in the Pilbara region for upgrading manganese and iron ores. The results highlight the effectiveness of the DMS process in producing high-grade manganese concentrates.

Positive Scoping Study Highlights Balfour Manganese Field Potential

Subsequent to the reported period, the company released a positive Scoping Study for the KR1 and KR2 Mineral Resources at the Balfour Manganese Field.

The study suggests that developing these deposits could yield substantial financial returns, with a pre-tax NPV of AU$340 million (at an 8% discount rate) and a pre-tax IRR of 70%. Projected revenues over the 16-year mine life are estimated at AU$2.78 billion, with an EBITDA of AU$654 million and an average annual operating cash flow of AU$46.1 million.

Moreover, on 29 July, the company announced the successful completion of a placement to raise AU$0.85 million. Black Canyons existing eligible shareholders, will be invited to participate in a Share Purchase Plan under the same terms of the placement, to raise further AU$0.5 million.

The funds will support development studies and exploration within the company's manganese portfolio. This includes metallurgical studies to optimise the manganese concentrate flowsheet and feasibility activities, as well as drilling at the high-grade Wandanya manganese target.

 Planned activities for the September 2024 quarter

For the September 2024 quarter, Black Canyon plans to:

• Review autumn surveys of flora, vegetation, and fauna across the KR1 and KR2 project areas, and plan follow-up surveys.
• Conduct IP surveys over the Fig Tree target corridor.
• Plan RC drilling at the Wandanya high-grade manganese project and infill drilling at the KR2 deposit to upgrade resources from Inferred to Indicated.
• Continue hydrometallurgical testwork aimed at producing battery-grade High Purity Manganese Sulfate Monohydrate (HPMSM).
• Assess potential locations for an HPMSM facility in Australia, focusing on areas with manufacturing hubs, infrastructure, reagent availability, and access to renewable energy.
• Advance discussions with third parties interested in offtake agreements or involvement in HPMSM and manganese concentrate production.

BCA shares are trading at AU$0.070, up 7.69% at the time of writing on 07 August 2024.