AAA.L Regulatory News (AAA)

25 Aug 2005 07:00

Adastra Minerals Inc25 August 2005 Adastra DRC Subsidiary to Join Extractive Industries Transparency Initiative Trading: TSX and AIM: AAA LONDON, U.K. (August 25, 2005) -- Adastra Minerals Inc. ("Adastra") announcesthat the Board of Directors of its subsidiary Kingamyambo Musonoi Tailings Sarl("KMT"), which owns 100% of the Kolwezi Cobalt and Copper Tailings Deposit (the"Kolwezi Project") in the Democratic Republic of Congo ("DRC"), has unanimouslyresolved to become a signatory of the Extractive Industries TransparencyInitiative ("EITI"). The EITI is a coalition of governments, companies, civil society groups,investors and international organisations. Its objective is improved governancein resource rich countries through the full publication and verification of allpayments to governments by companies in the oil, gas and mining sectors and acorresponding publication of all receipts from the natural resource sectors bygovernments. Resource rich countries implementing the EITI can benefit from an improvedinvestment climate by providing a clear signal to investors and theinternational financial institutions that the government is committed tostrengthening transparency and accountability over natural resource revenues. Inturn this will permit a greater scrutiny by civil society of governments'stewardship of financial resources. The Government of the DRC has endorsed the EITI and is currently considering howbest to implement the intiative. KMT will be the first mining company in theDRC to join the EITI. "We believe that a high level of transparency is crucial for any mining companyoperating in a developing country. We are therefore very committed to theprinciples laid out by the EITI, which will help to engender trust and dialoguebetween all stakeholders in mining revenues," said Tim Read, President and CEOof Adastra. "The Government of the DRC has committed itself to creating anenvironment conducive to private-sector led growth, as evidenced by theforthcoming democratic elections, the promulgation of the new mining code, andthe establishment of macro-economic stability leading to the renewal of economicgrowth. We believe the implementation of the EITI will provide further evidenceto the international business community that the DRC is open for business." About the Kolwezi Project Adastra's Kolwezi Project consists of two dams containing 112.8 million tonnesof oxide tailings, grading 1.49% copper and 0.32% cobalt, as determined by Dr.Isobel Clark of Geostokos Limited, a "qualified person" as defined by theCanadian Securities Administrators' NI 43-101. This resource has the potentialto host one of the world's largest and lowest cost cobalt producers. Such aproject would generate significant tax and foreign exchange earnings, as well asproviding local employment and contributing to the revival of the DRC's copperbelt infrastructure. About KMT KMT is the DRC registered operating company for the Kolwezi Project. It iscurrently owned 82.5% Adastra, 5% by the Government of the DRC and 12.5% by LaGenerale des Carrieres et des Mines ("Gecamines"), the government owned miningcompany. All three shareholders are represented on the KMT Board. TheInternational Finance Corporation (a part of the World Bank Group) and theIndustrial Development Corporation of South Africa have confirmed theirintentions to exercise options to acquire 7.5% and 10.0% of KMT, respectively,from Adastra, whose shareholding would thereby be reduced to 65%. Both newinvestors strongly endorse the decision to become signatories of the EITI. About Adastra Adastra is an international mining company listed on the Toronto Stock Exchangeand on AIM, in London, under the symbol "AAA". It is currently developingseveral mineral assets in Central Africa, including the Kolwezi Project and thepossible rehabilitation of the Kipushi zinc mine in the DRC. Adastra's growthstrategy emphasizes the creation of shareholder value through the development ofworld-class resources in stable or stabilizing political environments. For further information on the Extractive Industries Transparency Initiative,please review: http://www.eitransparency.org/ Contact us: LondonTim Read Justine Howarth / Cathy MalinsChief Executive Officer Parkgreen CommunicationsT: +44 (0)20 7355 3552 T: +44 (0)20 7493 3713F: +44 (0)20 7355 3554 F: +44 (0)20 7491 3936E: london@adastramin.com E: justine.howarth@parkgreenmedia.com North AmericaMartti KangasThe Equicom GroupT: +1 416 815 0700 x. 243 +1 800 385 5451 (toll free)F: +1 416 815 0080E: mkangas@equicomgroup.com This News Release contains forward-looking statements within the meaning of theUnited States Private Securities Litigation Reform Act of 1995 concerning theCompany's plans for its principal properties in the Democratic Republic of Congo("DRC"). These forward-looking statements are subject to a variety of risks anduncertainties which could cause actual events or results to differ materiallyfrom those reflected in the forward-looking statements, including, withoutlimitation, risks and uncertainties relating to political risks involving theCompany's operations in the DRC and the policies of other nations andorganizations towards companies doing business in such jurisdictions, theinherent uncertainty of production and cost estimates and the potential forunexpected costs and expenses, commodity price fluctuations, the inability orfailure to obtain adequate financing on a timely basis and other risks anduncertainties, including those described in the Company's Annual Report on Form20-F for the year ended October 31, 2004 and Reports on Form 6-K filed with theSecurities and Exchange Commission. This information is provided by RNS The company news service from the London Stock Exchange