Contango makes strides at Muchesu following £940 0...

Contango makes strides at Muchesu following £940 000 capital raise

Nyashadzashe Ndoro

Zim Now Reporter

Contango Holdings Plc, focused on developing Zimbabwe’s massive Muchesu coal project, announced positive progress following a successful capital raise of £940 000 in early April 2024.

“The Placing has allowed us to resume operations at the site and fulfil requests for coal samples from potential offtake customers,” said Contango in a statement on Thursday.

Since the capital raise, Contango has mined, screened, and washed 120 tonnes of coking and industrial coal for two potential industrial customers in southern Africa. These customers will collect their 60-tonne samples this week.

The company has already sent samples to other potential offtake partners. Contango reports ongoing discussions representing potential demand exceeding 50 000 tonnes of coal per month.

While not all discussions are expected to be successful, Contango “reasonably believes several contracts are likely to materialise from these interested parties during this quarter,” along with continued discussions for coking coal offtake agreements.

Contango has also extracted an additional 250 tonnes of thermal coal for a potential offtake partner who will conduct a “burn test” next week. Positive test results are expected to pave the way for a “sizeable long-term thermal offtake contract.”

Alongside operational progress, Contango is engaged with several groups interested in a potential joint venture or outright purchase of the Muchesu mine. The company is providing further information to these parties as part of their ongoing due diligence process.

Contango pledged to keep shareholders updated on both operational and corporate developments. The company will soon upload recent operational videos and images to their website and social media accounts, along with additional images included in the press release.