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Blencowe Resources Plc (LSE: BRES) is pleased to announce an update to the commercial model underpinning the Definitive Feasibility Study (“DFS”) for the Orom-Cross graphite project in Uganda, reflecting a number of developments since the initial DFS was published in December 2025.

The updated model incorporates revised assumptions and inputs since the initial DFS, including new high value offtakers, updated pricing, costings and timings, expanded reserves incorporated into the mine plan, and increased confidence in product mix and saleability based on ongoing testwork and commercial engagement. Importantly, these improvements have been achieved without any increase in capital spend to deliver the project.

The revised commercial model increases Net Present Value10 (“NPV10“) by 15%, from US$1.087 billion to US$1.254 billion over the initial 15-year life of mine (“LOM”).  While IRR has moderated versus the initial model due to updated inputs (specifically timing of capital spend), the revised DFS model continues to demonstrate robust economics with increased free cash generation.  

Highlights

·    NPV10: +15% to US$1.254 billion (initial 15-year LOM); IRR10: 51%.

·    Net Free Cash: +120% to US$4.466 billion over LOM with increased volumes and prices for high grade purified graphite products from beneficiation facility, reflecting global demand.

·    Average Annual EBITDA: +45% to US$333 million p.a.

·    Capex: unchanged for both phases (P1 US$45m; P2 US$125m). Competitive internationally given infrastructure proximity.

·    Commercial progress: several new offtake agreements, including high value niche sales, now reflected within revised DFS model.

·    Market shift: western markets actively seeking purified products ex-China supports higher volume sales expected in highest value products.

·    Expandables included: additional downstream processing pathway for expandable graphite and associated sales incorporated.

·    Tenders submitted: applications submitted into several sizeable graphite tenders; outcomes expected to become clearer in Q3 2026.

·    Strategy: downstream beneficiation / higher-value upgraded products remains core (including USPG and expandables).

Commercial Model and Scaling

Orom-Cross is expected to scale-up production in line with expected increased demand from offtakers for both concentrates and purified products.  The Company’s view is that the project is less constrained by what it can produce than by what it can contract and sell into higher-value pathways, particularly as all upgraded products are now qualified and commercial terms for these are more evident. 

Blencowe believes demand for natural flake graphite and upgraded products will continue to grow, specifically from Western markets seeking non-Chinese supply, while supply growth may remain constrained, thus supporting the opportunity for new entrants with scalable, high-quality product pathways and beneficiation.

Following successful bulk sample testing in 2025, the Company has continued engagement across multiple markets and sectors.  Several new offtake agreements have been signed (including higher-value niche sales) and these are now reflected in the revised DFS model.  Growth in net cash flow and NPV is largely the result of increased volumes of purified products sold as well as higher pricing for these as expected from Western markets.  The Company expects to provide updates as further milestones are reached and disclosure is permitted.

The revised model reflects improved reserve confidence from the Stage 7 programme and incorporates the updated mine plan assumptions, providing greater assurance around production volumes and scalable operations over time.

Capital Framework and Phasing

Importantly, the revised DFS model reflects updated operating inputs (including fuel and equipment assumptions) without any increase in anticipated capital spend required to deliver the project:

·      Phase 1 Production (P1): US$45 million (project equity-led pathway; faster start-up)

·      Phase 2 Production (P2): US$125 million (scale-up and in-country downstream capability; predominantly debt-led)

This phasing supports a staged approach to de-risk execution while maintaining the long-term vision to deliver upgraded products in-country.

Blencowe notes the capital requirements are in the lowest percentile internationally and are highly competitive by industry standards, particularly as they cover both the Orom-Cross mining and processing operation and the beneficiation facility near Gulu.

Downstream Pathway and Non-China Demand

The Company’s long-term strategy to deliver upgraded purified products remains core, including uncoated spheronised purified graphite (“USPG”) and expandables. Where appropriate, the Company expects to utilise third-party processing partners to upgrade in the interim while progressing in-country capability.

Demand for non-Chinese graphite products (particularly purified products) continues to build as Western markets seek supply chain resilience. The Company believes Orom-Cross’ expanding inventory, product options and developing commercial pathway significantly strengthen the project’s strategic relevance.

Uganda Value-Add and In-Country Beneficiation

Blencowe’s long-term strategy is to maximise in-country value-add in Uganda through the production of upgraded graphite products, including USPG and expandables, supported by beneficiation capacity near Gulu. This approach aligns with Uganda’s broader objectives around local processing and value addition, skills transfer and industrial development, while strengthening Orom-Cross’ positioning within resilient, non-China supply chains.

Infrastructure and On-Site Progress

·    Upgrade and sealing works have commenced on the road from Kitgum to Orom-Cross, managed and paid for by the UK Government, improving logistics to Mombasa port.  This project is expected to be completed ahead of ramp up of Orom-Cross (P2 Production) and thus supports higher volumes moved from site.

·    A first permanent camp was completed at Orom-Cross in 1Q 2026 to house contractors during mine construction, which will commence following funding.

Next Steps

The Company will continue to pursue value enhancement across Orom-Cross as further test work is delivered, tenders are completed, and as strategic relationships progress.

·      Tenders:

The Company has submitted applications into several sizeable, strategic graphite tenders and expects greater clarity on outcomes in the next quarter (Q3 2026).  Successful outcomes will underpin expected volume growth for both concentrate and upgraded product streams. 

·      SAFELOOP:

Significant progress has been made within the EU’s SAFELOOP initiative (developing a Gen3 lithium-ion battery for deployment in standardised EV buses across the European continent) but no sales for this initiative have been included in any DFS modelling to date.

·      Price and product mix: continued improvements from higher-value niche sales and upgraded products.

Additional upside under evaluation but not yet modelled include industrial diamonds, further micronisation, speciality defence/energy applications, ultra-high purity (99.99% TGC) products, tenders underway and Project SAFELOOP (all subject to commercial terms).

As the project advances, the Company is focused on ensuring Orom-Cross is understood by a broader pool of sophisticated capital, supported by improved research coverage and institutional engagement.  This will become a central part of Blencowe’s corporate strategy over forthcoming months as the Company seeks to bring more institutional shareholders onto the register.

Funding Strategy and Near-Term Priorities

The combination of low upfront capex, staged development, and downstream exposure positions Orom-Cross within a limited subset of graphite projects capable of meeting both return-thresholds and strategic supply chain requirements to attract the required capital.

Blencowe continues to progress two complementary funding pathways alongside ongoing commercial and development activity:

1.    Phase 1 Production (P1) – US$45m (project-level focus):

·    Primary focus is securing P1 equity funding, with a preference for project-level funding to minimise dilution at the plc level.

·    The Company notes that several interested P1 investment partners have signed NDAs and are conducting due diligence in the data room as part of their internal financial decision-making processes.

·    P1 is designed to establish an operating and sales track record and support downstream qualification from site, and to deliver pricing visibility which is critical to debt funding.

2.    Phase 2 Production (P2) – US$125m (predominantly debt):

·    P2 funds ramp-up mining to scale as well as in-country downstream processing capability near to Orom-Cross and is expected to be funded predominantly via debt.

·    Expressions of interest and diligence pathways for debt providers are underway as they typically take longer than equity-led funding.

·    DFI-style routes, including DFC, continue to be considered as potential debt funding pathways for P2 (not considered within P1 equity).

Several interested P1 funding parties have signed NDAs and are conducting due diligence in the data room. The Company is progressing all parties as efficiently as possible and will provide updates when there is substantive progress suitable for announcement.

Updated Production Pathway (as reflected in the model)

The updated DFS incorporates a refined staged plan:

·      P1: delivers up to 20,000tpa of 97% TGC concentrate at Orom-Cross plus up to 3,000tpa spheronised graphite from in-country beneficiation at a proposed facility near to Gulu.  

·      P2: delivers up to 70,000tpa of 97% TGC concentrate plus up to 10,000tpa USPG and expandables from in-country beneficiation.  

The Company notes that all subsequent phases of growth beyond P2 Production are driven by demand and contracted sales, with Orom-Cross not constrained by potential production so much as by sell-through of higher-value product streams. 

Blencowe CEO Mike Ralston discusses the updated DFS with Vox in the interview below:

www.voxmarkets.com/articles/interview-with-blencowe-resources-0de98ba

Executive Chairman Cameron Pearce commented:

“This DFS model update reflects tangible progress across Orom-Cross. NPV10 increases to US$1.254 billion and net free cash rises to US$4.466 billion, while capital spend remains unchanged across both Phase 1 and Phase 2. While IRR has moderated versus the prior model due to updated inputs, the economics remain highly robust and the uplift in NPV and cash generation is the key outcome for project funding and delivery.

Just as importantly, the revised model now reflects additional commercial inputs, including new offtake agreements and the inclusion of expandables. We have also submitted into several sizeable graphite tenders and expect greater clarity on outcomes for these in the next quarter.

Funding remains the key gatekeeper. We continue to progress Phase 1 equity discussions, alongside longer-dated Phase 2 debt pathways, and we will update the market as and when appropriate.

Additionally, as Orom-Cross advances, we are also focused on ensuring the enlarged investment case is understood by a broader pool of sophisticated capital, supported by improved research coverage and institutional engagement.”

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