African Eagle Resources Regulatory News (AFE)

26 Feb 2007 07:01

African Eagle Resources PLC26 February 2007 African Eagle Resources plc JOINT VENTURE WITH PHELPS DODGE MINING (ZAMBIA) LIMITED- NDOLA COPPER PROJECT African Eagle Resources plc ("African Eagle" or "the Company", ticker AIM: AFE)is pleased to announce that the Zambian Minister of Mines and MineralDevelopment has given his consent to the earn-in agreement which was signed on3rd August 2006 between the Company and Phelps Dodge Mining (Zambia) Limited(PDMZ), a wholly owned subsidiary of the Phelps Dodge Exploration Corporation. All of the pre-conditions to the earn-in agreement have now been satisfied andaccordingly PDMZ has now subscribed for the initial tranche of 5,908,754 AFEshares at a price of 11.0275p per Ordinary Share, representing a 10% premium tothe average closing mid-market price of AFE's shares for the 10 consecutivedealing days immediately preceding 15 February 2007 and equivalent to a value ofUS$1,273,333 or £651,588. Following this issue, PDMZ now holds approximately3.84% of the Company's share capital. Application has been made for theadmission of the new Ordinary Shares to trading on AIM and dealings are expectedto commence on or about 1 March 2007. Under the terms of the earn-in agreement, AFE is spending at least 75% of theamount subscribed on an agreed 15-month exploration programme on the Ndolalicence. The balance will be spent on other AFE projects and general workingcapital. Within 12 months PDMZ will subscribe for a second tranche of shares toa value of US$1 million. Under the agreement, PDMZ can earn a 51% interest inthe project by spending a further US$3 million on exploration and then anadditional 19% by completing a bankable feasibility study. African Eagle's Managing Director, Mark Parker, comments: "We are pleased thatPDMZ's share subscription has now been completed. We have already largelycompleted our basic surveys over this highly prospective licence and have nowcommenced drilling on our priority targets. Our Agreement with PDMZ is in linewith African Eagle's strategy of working with partners to take our mostpromising projects through to production decisions." John ParkChairmanAfrican Eagle Resources plc 26 February 2007 About African Eagle African Eagle is a mineral exploration and development company operating ineastern and central Africa. The Company's principal advanced projects are theMkushi Copper Mines project in Zambia and the Miyabi gold project in Tanzania,which are being fast-tracking towards production. The Company also holds a largewell-balanced portfolio of promising earlier stage gold and base metal projects,including the Ndola copper project and the Eagle Eye iron-oxide copper goldproject. African Eagle's projects are in Zambia, Tanzania and Mozambique, countries whichall have highly prospective geology, relatively low above-ground risks and trackrecords of successful major investments in the metals and minerals industries. African Eagle specialises in project generation and exploration. To take itsdiscoveries into production, it seeks to sign up industry partners with recordsof successful mine development. These joint ventures and, in time, the revenuefrom advanced projects, will finance future exploration and new discoveries. The Company has a highly motivated team, proven management and an experiencedboard. African Eagle prides itself on being a low cost operator and on average80p or more of every £1 is spent "in the ground". About Ndola African Eagle's Ndola licence lies in the southern part of the hugely prolificCentral African Copperbelt, one of the great mining districts of the world. TheCopperbelt hosts two of the world's ten biggest copper deposits and contains aglobal resource of almost 200 million tonnes of copper metal, mostly in veryhigh grade ores. The Ndola licence surrounds the historic Bwana Mkubwa copper mine and occupies alittle-explored gap between the Frontier and Lonshi Mines operated by FirstQuantum Minerals. The Group believes that modern exploration techniques coupledwith current geological thinking on Copperbelt mineralisation could yieldsignificant discoveries at Ndola. In late 2005, the Company conducted a thorough review of archive information onthe mineral resources and potential of the Ndola area. The review concluded thatthe area is highly prospective for copper deposits, of the Frontier and Lonshitype as well as the classic Zambian Copperbelt Mine Series hosted type.Widely spaced drilling in the Mine Series during the 1950s and 60s revealed aresource of some 40 million tonnes of 0.75% copper northeast of Ndola town, anda deposit containing 3 million tonnes of 3.5% combined lead and zinc near thecentre of the licence. These deposits were only sketchily explored and havepotential for further development. For further information, see the Company's web site www.africaneagle.co.uk orcontact one of the following: Mark ParkerManaging Director+44 20 7248 6059+44 77 5640 6899 Chris DaviesOperations Director+44 20 7248 6059+44 78 6672 9959 Ed Portman/ Leesa PetersConduit PR+44 20 7429 6607 / +44 (0) 7733 635 01 Nicola MarrinSeymour Pierce+44 20 7107 8018 This information is provided by RNS The company news service from the London Stock Exchange