AAA.L Regulatory News (AAA)

17 Oct 2005 11:43

Adastra Minerals Inc17 October 2005 This announcement replaces the RNS announcement (reference number 7433S)released at 09:40am on 17 October 2005. The first paragraph should havereferred to the 'International Finance Corporation', which is the World BankGroup's private sector arm, not the 'International Financial Corporation'. Thefull amended press release is below: IFC and IDC finalise Option Exercises for Kolwezi Shareholdings Trading: TSX and AIM: AAA LONDON, U.K. (October 17 2005) - Adastra Minerals Inc. ("Adastra" or "theCompany") announces that the Industrial Development Corporation of South Africa("IDC") and the International Finance Corporation ("IFC"), the World BankGroup's private sector arm, have now executed definitive agreements withAdastra, exercising their options to acquire respectively 10% and 7.5%shareholdings in Kingamyambo Musonoi Tailings Sarl ("KMT"). KMT owns 100% of,and will develop, the Kolwezi tailings deposit ("Kolwezi Project") in theDemocratic Republic of Congo ("DRC"). The IDC and IFC have acquired their equity interests in KMT at prices based onthe allowable expenditures on the Kolwezi Project up to the date of exercisingtheir respective options, and will pre-fund their respective proportions (basedon ownership of Class C shares) of the estimated costs of taking the KolweziProject forward to the decision to construct. As a result, Adastra's whollyowned subsidiary, Congo Mineral Developments Limited ("CMD"), will receiveapproximately US$12 million in cash. "Exercising these options is a very strong endorsement of the IDC's and IFC'ssupport for the Kolwezi Project," said Tim Read, CEO of Adastra. "Having twosuch partners also demonstrates the importance Adastra places on SustainableDevelopment. This project has the potential to bring important social,environmental and macro-economic benefits to the Kolwezi region of the DRC. Welook forward to harnessing the extensive experience of these two notableorganisations and working together to finance and develop the Kolwezi Projectaccording to world standards." Geoffrey Qhena, CEO of IDC, said: "We are exercising the options because thisproject fits in well with our investment strategy for Africa that we participatein projects that are geared to make a difference by creating jobs. Kolwezi is aproject that surely will make a difference amongst the communities of Kolwezi.We anticipate that this project shall generate socio-economic benefits to thepeople living in the region." Rashad Kaldany, Director of IFC's Oil, Gas, Mining and Chemicals Departmentnoted that the Kolwezi Project is currently the most advanced mining project inthe DRC, and would be the first one to move forward under the country's newmining code, which, amongst other things, regulates the accrual of financialbenefits from mining to central and local governments. The IFC cooperatesclosely with the World Bank, which assisted in the drafting of the code. "If thedevelopment of the project proceeds as planned, the Kolwezi Tailings project hasthe potential to act as a benchmark project through its commitment to revenuetransparency and local community development. Moreover, a successful projectimplementation should give confidence to further private sector development inthe DRC's mining sector. The IFC is particularly pleased that both Adastra andthe Government of the DRC are committed to the principles of the ExtractiveIndustries Transparency Initiative (EITI)." Following the completion of the transactions, the share ownership of KMT will beas follows:Capital Structure Shareholders Ownership Class of % of KMT % of class % of KMTShares A 5.0 Government of the DRC 100.0 5.0B 12.5 Gecamines 100.0 12.5C 82.5 CMD 78.8 65.0 IDC 12.1 10.0 IFC 9.1 7.5 _____ _____ 100.0 Total 100.0 About the Industrial Development Corporation of South Africa The IDC (www.idc.co.za) is a self-financing, South African state-owned nationaldevelopment finance institution that provides financing to entrepreneurs engagedin competitive industries. It follows normal company policies and procedures inits operations, pays income tax at corporate rates and dividends to itsshareholder, and reports on a consolidated basis, with its annual report freelyavailable to the public. Its primary objectives are to contribute to balanced sustainable economic growthin Africa and to the economic empowerment of the South African population,thereby promoting the economic prosperity of all citizens of the Africancontinent. About the International Finance Corporation The International Finance Corporation is the private sector arm of the WorldBank Group and is headquartered in Washington, D.C. IFC coordinates itsactivities with the other institutions of the World Bank Group but is legallyand financially independent. Its 178 member countries provide its share capitaland collectively determine its policies. The mission of IFC is to promote sustainable private sector investment indeveloping and transition countries, helping to reduce poverty and improvepeople's lives. IFC finances private sector investments in the developing world,mobilizes capital in the international financial markets, helps clients improvesocial and environmental sustainability, and provides technical assistance andadvice to governments and businesses. From its founding in 1956 through FY05,IFC has committed more than $49 billion of its own funds and arranged $24billion in syndications for 3,319 companies in 140 developing countries. Formore information, visit www.ifc.org. 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 potential tohost one of the world's largest and lowest cost cobalt producers. A definitivefeasibility study is expected to be completed in the first quarter of 2006. Ifthis study is favourable, construction is expected to commence before year-end,with first production in mid 2008. The project is expected to produce initiallyapproximately 5,500 tonnes of cobalt and 30,000 tonnes of copper annually, atwhich level of output Kolwezi has a mine life in excess of 50 years. Such a project would generate significant taxation, royalty and dividendrevenues to the Government, as well as providing local employment andcontributing to the regeneration of the DRC's copper belt infrastructure. 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. Contact us: Adastra in London Tim Read Justine Howarth/ Cathy Malins Chief Executive Officer Parkgreen Communications T: +44 (0)20 7355 3552 T: +44 (0)20 7493 3713 F: +44 (0)20 7355 3554 F: +44 (0)20 7491 3936 E: london@adastramin.com E: justine.howarth@parkgreenmedia.com IDC in South Africa IFC in Washington Dante Mashile, CPRP Joe O'Keefe Head of Corporate Affairs Senior Manager Corporate Relations Industrial Development Corporation International Finance Corporation T:+27 11 269 3891 T: +1 202 458 4032 M:+27 83 643 1859 E: jokeefe@ifc.org F:+27 11 269 3894 http://www.ifc.org E:dantem@idc.co.za http://www.idc.co.za Adastra in North America Martti Kangas The Equicom Group T: +1 416 815 0700 x. 243 +1 800 385 5451 (toll free) F: +1 416 815 0080 E: 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