Page 44 - pd296-August21-mag-web

AFRIcA DoWn UnDeR PReVIeW

Strolling in the sunshine

ully funded and construction under registered 200 new companies in the In May, Walkabout joined the Europe-
Fway, Walkabout Resources Ltd’s cur- first half of July, that shows the surge in an Raw Material Alliance, potentially giv-
rent position with its Lindi Jumbo graph- confidence. ing it access to strategic partners eager
ite project must have felt very far away “President Suluhu Hassan is bringing to source alternative graphite supplies.
at several moments in the last five years. new capital works programmes back on “The Alliance is the ideal platform
Walkabout’s ambitions for Lindi Jumbo without pointing fingers at international to collaborate with industry specialists
over the period were frustrated by dark firms. In fact, the fingers she is pointing in Europe and to support efforts to se-
clouds falling over the graphite market are at her own tax office for discouraging cure future supply of an alternative new
and the Tanzanian investment climate investment. source of graphite through strategic
freezing over, but this year has seen the “Tanzania is very proud of her and the partnerships while make a lasting and
company take advantage of brighter out- whole region sees her as a bright light.” meaningful economic contribution to the
looks for both. The one legacy issue remaining from region of origin,” new Walkabout chief ex-
Graphite prices have climbed steadily Magufuli’s presidency is the question of ecutive Andrew Cunningham said.
in the last 12 months and the approach of the Government’s entitlement to a 16% Walkabout has tapped into the positiv-
new Tanzanian President Samia Suluhu free-carried interest in projects. Mulligan ity around both graphite and Tanzania.
Hassan in welcoming foreign capital has said expectations in Tanzania were for In May, the company completed the first
given companies such as Walkabout a the policy to remain as a default position tranche of a three-pronged equity rais-
more positive case to present investors. for all mining deals. ing, placing $6.4 million worth of shares
“Those were the strong resistance “The Government has changed the to Australian institutional investors.
points; the perceived opacity of the model from applying it on a case-by- A rights issue to existing shareholders
graphite market and the legacy of the case basis to it being a universal stand- netted a further $US4 million with a sec-
2017 mining act amendments in Tanza- ard model across the industry,” he said. ond placement of up to $US10 million go-
nia,” longstanding Walkabout director Al- If the investment outlook for Tanzania ing to US-based Battery Metals Capital
lan Mulligan said. is sunnier, the same could be said for Group LLC. Battery Metals took $US1.7
The amendments introduced by then- graphite. Lindi Jumbo is a high-grade, million immediately with a further $US4.3
President John Magufuli were created large flake deposit, one of the few million subject to shareholder approval.
following a tax dispute with the country’s sources of such material outside China. The third tranche of $US4 million will
largest gold miner, Acacia Mining. While Mulligan believes this will become an come no later than 10 months after the
junior miners such as Walkabout were important factor as international groups second.
far from happy with the changes, Mulli- lift their demand to meet the global EV Completion of the equity component
gan believes the reaction was probably rollout. paves the way for drawdown of the debt
too severe. “If you produce a quality product, eve- facility to begin.
“The policy changes were poorly han- ryone outside of China will be interested Walkabout has already moved pro-
dled in Tanzania, but the situation was in it,” he explained. “The rest of the world ceeds from the Australian placement to
also poorly managed in Australia,” he wants independence in the battery sup- its bank accounts in Tanzania, a move
said. ply chain so will need to source material in keeping with the company’s corporate
When the policy changes were an- outside China. A lot of it will be going approach, according to Mulligan.
nounced the ASX forced Walkabout and into the European market where there “That has bought us a lot of credibility
other Tanzanian-focused explorers and are more than 20 battery factories being with CRDB, they recognise us as a seri-
developers into trading halts, casting un- built.” ous company,” he said. “Funds from the
necessary uncertainty about the security
of their projects.
“That did a lot of publicity damage for
Tanzania,” Mulligan said.
The turnaround in 2021 has been dra-
matic. Since April, Walkabout has closed
a $US20 million project debt financing
deal with Tanzanian commercial bank
CRDB and has finalised a three tranche
equity raising which will eventually net it
the $US12 million needed to fund project
construction.
Mulligan – who has resigned as direc-
tor and assumed the position of chief op-
erating officer – told Paydirt both com-
modity and country were enjoying new
momentum.
“Tanzania is a very different environ-
ment under the new President,” he said.
“The Companies Administration office
Allan Mulligan

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