Capital Metals awarded another exploration licence in Sri Lanka

Sri Lanka-focussed mineral sands developer Capital Metals announced the issue of an additional exploration licence on Tuesday, further extending the Eastern Minerals Project by 12 kilometres to the north, including the Oluvil Port.

The AIM-traded firm said its wholly-owned subsidiary Damsila Exports was granted a new licence as an extension from the northern boundary of the current project.

It said the licence provided a further 12 kilometres length of contiguous coverage, over a total area of 24 square kilometres.

The licence contained areas prospective for further mineral sands resources, which were identified for follow-up drilling later in the year.

Capital Metals said the licence was granted by the Geographical Survey and Mines Bureau of Sri Lanka (GSMB), which is also the government authority tasked with issuing the company's first industrial mining licence.

The licence was granted for an initial period of two years, but could be renewed up to four times for a potential term of 10 years.

“Obtaining the additional exploration licence is a great achievement and shows that Sri Lanka is well and truly open for business following delays as a result of Covid-19,” said chief executive officer Michael Frayne.

“We worked closely with the GSMB to obtain this licence and are encouraged that they are getting back to being fully operational as they are also the authority that will grant our industrial mining licence.

“We are very excited to add this licence to our exploration portfolio and look forward to drilling identified areas on it later this year.”

At 1122 BST, shares in Capital Metals were up 2.07% at 7.4p.