They are the revenue-generating Montepuez Ruby Project and the high-grade Caula Graphite Vanadium Project.
The two projects are near each other and share a tenement boundary meaning they share camp, infrastructure and certain key personnel.
Next to the world’s largest ruby deposit
The Montepuez Ruby Project is adjacent to the world’s largest ruby deposit discovered in 2009 and currently mined by Gemfields plc (LON:GEM).
Since the start of project development in early 2016, Mustang’s team has made significant progress in exploration, bulk sampling and ruby recovery.
Mustang has two bulk sampling processing plants onsite, capable of processing 200 tonnes of material per hour.
Shallow low-cost mining
Mustang’s bulk sample mining is currently concentrated in an area in the south-eastern part of its concessions, where gem-rich gravels can be found at the depth of less than one meter.
Operations at such shallow depth are inexpensive, as little overburden removal is required.
Ruby inventory stands at over 330,000 carats
During exploration efforts in late 2017 and early 2018, 69 sampling pits were developed, and 14,502 tonnes of material extracted for bulk sampling.
As of the end of January 2018, Mustang’s gem quality ruby inventory stood at 302,028 carats.
In early March 2018 this had climbed to 333,184 carats.
Sales and marketing strategy for rubies
In March 2018, after a strategic review, Mustang elected to close its sales facilities in Mauritius to establish a sales and marketing office in Chanthaburi, Thailand.
This measured approach to marketing is intended to generate regular cashflow as it continues to pursue exploration and bulk sampling activities.
Thailand is considered the world-leader in trading and beneficiation of coloured gemstones, especially rubies and sapphires.
Fast-tracking Caula Graphite Vanadium Project
During March 2018, Mustang concluded from a strategic review that its Caula Graphite Vanadium Project in Mozambique could achieve first production by mid-2019.
The review’s key recommendation was to establish trial mining and processing operations for completion during the June quarter of 2019.
Mustang’s board of directors has accepted the recommendation.
Mustang considers that trial mining and processing operations at Caula could produce both graphite and vanadium concentrates.
The trial mining development strategy is based on a robust, low-cost mining operation and construction of a processing plant capable of handling 100,000 tonnes per annum of ore.
Scoping study to consider full-scale mining and processing operation
The strategic review does not form part of the formal scoping study, which is set for completion in the June 2018 quarter.
The scoping study will consider the merits of a full commercial-scale graphite and vanadium operation.
Conditional on a positive outcome of the scoping study, a definitive feasibility study (DFS) will be undertaken to serve as a basis for project development and financing.
A hole drilled 7.5 kilometres from previously drilled mineralisation at the Caula Graphite Vanadium project hit high-grade graphite and vanadium.
Importantly, assays from the diamond drill hole showed grades of up to 23.7% total graphitic carbon (TGC) and 0.68% vanadium.
Intersecting this mineralisation 7.5 kilometres from the main Caula mineralisation further establishes this graphite and vanadium project as world-class.
Mozambique is pro-mining
Mozambique is a pro-mining and foreign investment jurisdiction.
As at October 2015, the World Bank portfolio had an overall net commitment of US $ 1.5 billion distributed across all major sectors.
Notably, Mustang’s experienced team has a track record in developing profitable projects in Mozambique and greater Africa.