Mustang Resources Ltd.: Outstanding Metallurgical Results Highlight Quality of Caula Graphite-Vanadium Project

Sydney - Mustang Resources Ltd. (ASX:MUS) (OTCMKTS:MTTGF) is pleased to announce outstanding results from further graphite metallurgical testwork at its Caula Graphite-Vanadium Project in Mozambique.

Key Points

- The results of the metallurgical tests are considered truly outstanding because they have delivered a significant increase in flake size and a reduction in the costs of processing reagents

- Modified and improved flowsheet design allows for integrated graphite and vanadium extraction

- Cumulative proportion of large to super jumbo flakes (>180 m) increased from 44% to 60% for the combined Oxide zone while the Fresh zone increased from 55% to 68%

- High concentrate grades of more than 97% Total Graphitic Carbon have been maintained in modified flowsheet

- The tests were conducted on samples of oxide, transition and fresh material taken from the area of Caula drilled in 2017

- Composites from borehole MODD015 were tested. This borehole is located in the middle of the 2017 boreholes

- The excellent metallurgical results continue to demonstrate Caula's potential to be a low-cost supplier to the expandable graphite and lithium battery industries

- The results will now be incorporated into the Scoping Study which is well underway

Mustang Managing Director Dr. Bernard Olivier said: "These metallurgical results are outstanding and provide further evidence of the exceptional quality of the graphite at Caula. We managed to achieve an extraodinary 27% increase in the cumulative proportion of large to super jumbo flakes (>180?m) while maintaining our exceptional concentrate grade of 97%. The large to super jumbo flake-sizes in the fresh zone increased from 55% to 68% while the cumulative oxide zone increased from 44% to 60%."

The Caula Project is in a unique position of hosting high-grade, shallow mineralisation with an exceptional combination of recovery, graphite concentrate flake-size distribution, and purity.

The Caula Project is located along strike from Syrah Resources' (ASX:SYR) world-class Balama graphite project in Mozambique.

Details of testwork

The latest testwork flowsheet was a modification of a similar flowsheet used for the earlier work. The graphite test procedure comprised an initial coarse grind, a de-slime stage (by-passed on Fresh), then rougher flotation followed by three re-grind & cleaner flotation stages and two final cleaner flotation stages. By graphite industry standards, this is a remarkably simple flowsheet.

The flowsheet has been extended to allow integrated extraction of both graphite and vanadium from the same feed material. The first vanadium concentration work is currently in progress and result are expected in due course.

The main difference from the earlier work was the use of a single-stage grind with a target of 80% passing 650 ?m, rather than the multi-stage grind to 95% passing 710 ?m. The single stage grind was selected as Mustang considers that it will give a product size distribution that is more representative (than the multi-stage grind) of full scale operations.

A simpler and lower cost reagent scheme was also used in the current work. The new reagent scheme will cost less than half that used in the testwork for the 17 December announcement, further adding value to the project.

A further difference is that in this round of testwork the samples were composited into Fresh, Transition and Oxide. For earlier work, the samples had been composited into Fresh and Oxide, with the latter consisting of core material with any visible oxidation. This earlier "Oxide" classification is equivalent to a combination of the current "Oxide" and "Transition" classes.

The graphite concentrate grade and size distribution results achieved are summarised in Table 1(see link below).

All TGC concentrate assays quoted were determined using the double LOI method. All calculated TGC head assays from combined metallurgical test products were within experimental limitations of the composite grades.

A simplified comparison with the results announced on 17 December 2017 is shown below in Table 2(see link below). It can be seen that the proportion of concentrate with flake-size greater than 180 ?m has been substantially increased in the most recent work while the excellent concentrate grades have been maintained. For direct comparison with the earlier results a weighted average of the oxide and transitional results from the current work has been calculated and is shown as "Oxidised" in Table 2(see link below). The weighting is based on the composite weights shown in Table 3(see link below).

A blend of Oxide and Transition material is located on top of the Fresh zone and will therefore be extracted and processed first. This means that the dramatic improvement in performance of combined Oxide and Transition material is of great significance for the project.

Oxide, Transitional and Fresh samples were formed from the intervals shown in Table 3(see link below).

For earlier testwork, core material showing any oxidation was classed as oxide. For this current round of work a further distinction was made. It was recognised that there is a near-surface (to about 30 metres downhole) zone of material which (from the sample analyses) appears to have been depleted in sodium (and potassium) by weathering. This has been classed as oxide. Below this (and to about 60 metres downhole) is a zone with visible signs of weathering which has been classed as transitional. In this zone, a variable proportion of sulfides has been oxidised. Fresh material is found further downhole. The oxide material is very friable whilst transitional and fresh materials are generally quite competent(see Note below).

Mustang greatly welcomes the prospect of developing a low-cost high-grade graphite product. The high head-grade and simplified flowsheet bode well for the Scoping Study to be completed in Q3. The estimated completion of the Scoping Study has been pushed back slightly due to unexpected delays in receiving the remaining assay results back from the independent laboratory. A smaller processing plant (with lower Capex) would be required to generate a similar final product output compared to other projects with lower grades or more complex metallurgy. To have the project located in the mining-friendly country of Mozambique gives further advantage when compared with projects in other less mining friendly juristictions.

Note: Refer to ASX Announcement dated 1 May 2018 "More wide, high-grade vanadium results at Caula"

To view tables, please visit:
http://abnnewswire.net/lnk/XN829MK8

About Mustang Resources Ltd:

Listed on the Australian Securities Exchange, Mustang Resources Ltd. (ASX:MUS) (FRA:GGY) is an emerging gemstone developer and producer focused on the near-term development of the highly prospective Montepuez Ruby Project in northern Mozambique.

The Montepuez Ruby Project consists of three licences and now one mining concession covering 19,300 hectares directly adjacent to the world’s largest ruby deposit discovered by Gemfields Plc in 2012. Since supply of rubies from sources outside Mozambique has become fractured and unreliable, Mustang stands to capitalise on the current high demand around the world for ethically produced rubies by becoming a reliable, consistent supplier of high-quality rubies.

The Company is currently fast-tracking its work program on the Montepuez Ruby Project with extensive secondary deposits discovered and low-cost bulk sampling well underway. First rough ruby sales are scheduled for 27 to 30 October 2017 in Port Louis, Republic of Mauritius under a closed bid tender of more than 350,000 cts gem quality rubies.

Visit the Mustang website at http://www.mustangresources.com.au for more information.



Contact:

Mustang Resources Ltd.
Managing Director: Bernard Olivier
E: bernard@mustangresources.com.au
M: +61-4-08948-182
T: +27-66-4702-979

Media & Investor Relations: Paul Armstrong
E: paul@readcorporate.com.au
T: +61-8-9388-1474