Shares in Blencowe Resources PLC rose on Monday after the company said it has received an approach from a Chinese company with extensive experience in graphite that has the potential to provide an offtake, funding and development scenario for its Orom-Cross graphite project in Uganda.
The London-listed mining company said it has agreed to send a bulk sample of around 100 tones from Orom-Cross to China to enable further test work to be undertaken by the potential strategic party.
Blencowe Resources said it expects the tests to initially lead to nonbinding memorandum of understanding for offtake, and ultimately to binding sale.
The company added that it has taken the decision to postpone its plans to build an on-site pilot plant facility at Orom-Cross given the interest out of China and the relatively short period to complete the test work. Given the decision, the company will no longer have to raise around $10 million, as previously expected, to fund the development.
Shares at 0714 GMT were up 0.3 pence, or 9.2%, at 3.55 pence.