African Eagle Resources Regulatory News (AFE)

24 Aug 2007 09:38

African Eagle Resources PLC24 August 2007 FURTHER POSITIVE DRILLING RESULTS FROM THE MKUSHI COPPER MINES PROJECT, ZAMBIA * Latest drill results confirm L Zone as a significant potential resource with high grades of copper over substantial widths * New zones of mineralisation defined in L Zone Hanging Wall * Pre-feasibility study on track for completion in Q3, 2007 African Eagle plc ("the Company"; Ticker "AFE") announces latest drill resultsand a progress update from the Mkushi Copper Mines joint venture in centralZambia. Mineralised intercepts included: 37m at 2.42% copper 16m at 1.51% copper 17m at 1.39% copper 11m at 1.80% copper 6m at 3.36% copper African Eagle's Managing Director Mark Parker comments "The latest drillingresults from L Zone continue to impress and suggest that this newly definedmineralised zone is likely to contribute significantly to the existing resourceat Mkushi. We look forward to completion of the pre-feasibility study andresource update, scheduled for completion by the end of September." The Mkushi Copper Mines Project is a Joint Venture between CGA Mining Limited(CGA) and African Eagle Resources plc (African Eagle), through their respectiveZambian subsidiaries. CGA manages and funds the resource drilling andfeasibility operations while African Eagle manages a jointly funded regionalexploration programme. The latest results, shown in the table below, come from the resource drillingprogramme at L Zone and H Zone, which will form the basis of a pre-feasibiltystudy (PFS) scheduled for completion by the end of September. Based on thefindings of the PFS, a further drill programme will be designed to ensure thebankability of the final feasibility study. Hole No Prospect From (m) Width (m) Copper %MH048 L Zone 113 10 1.26and H Zone 175 12 1.20MH069 H Zone 224 6 3.36MH071 New Zone 64 5 0.94and New Zone 73 5 0.94MH073 New Zone 71 6 0.50and L Zone 119 37 2.42and H Zone 223 16 1.51and H Zone 250 17 1.39and H Zone 270 5 0.71MH075 New Zone 107 4 0.85and New Zone 129 6 1.61MH076 L Zone 256 2 3.68and L Zone 279 2 0.43MMU036 L Zone 132 11 1.80and New Zone 147 6 1.33and Munshiwemba 175 3 0.95 L ZONE The results highlight the growing potential of L Zone to be a significantcontributor to the copper resource. L Zone intersections included 37m at 2.42%copper from 119m in drill hole MH073. At greater depth, the same hole alsointersected H Zone, including 16m at 1.51% from 223m and 17m at 1.39% from 250m.Intersections previously reported from L Zone, from diamond drilling extensionsof RC pre-collar holes, include 23m at 1.38% copper in MH047, 25m at 1.79%copper in MH061 and 21m at 1.68% copper in MH062. Indications are that, in the vicinity of these intersections, L Zone is a singlebroad copper zone with a true width between 10 and 25m, extending approximately100m along strike and at least 150m down dip. North and south of this area, LZone fragments into a series of narrower discontinuous mineralised zones ofvarying grade, extending over a further 250m of strike. These are more difficultto correlate, from the existing data, however. An unmineralised dolerite dyke in the middle of the L Zone intersection in drillhole the MH073 is of interest. A review of relevant RC and diamond drill holesis being undertaken to assess whether this dolerite intrusion can assist indefining the L Zone structure, as this would be useful in locating repetitionsof similar mineralisation along strike. The current drilling programme includesdrill holes PH222 and PH224 to a depth of approx 150 vertical metres in the corearea of L Zone and an additional 1,000m of diamond drilling is planned toconfirm the current interpretation. FOOTWALL AND HANGING WALL TARGETS The drilling programme targeting L Zone has stepped out progressively to thewest and has uncovered new zones of mineralisation in the hanging wall. Theintersections so far are relatively shallow and mostly of lower grade than HZone, but as the grade of mineralisation in both H Zone and L Zone generallyincreases with depth, these discoveries warrant further testing. The betterexamples include 6m at 1.52% copper from 73m in MH071, 6m at 0.5% copper from71m in MH073 and 6m at 1.61% from 129m in MH075. These targets will be testedusing reverse circulation drilling with short diamond tails if required. Tenholes are planned for a total of 1,500m. The footwall of H Zone has been little tested to date, as previous drilling hastypically stopped 20-30m below the main mineralised zone. With the recentrecognition that the Mkushi mineralisation exists on more than one shearstructure, it is likely that further mineralisation is present. Drilling of 15further holes for 2,100m, extending 100m east of H Zone, is planned to testthese footwall targets. John ParkChairmanAfrican Eagle Resources plc 23rd August, 2007 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 Nicola MarrinSeymour Pierce+44 20 7107 8000 Ed Portman / Leesa PetersConduit PR, London+44 20 7429 6607 James DuncanRussell & Associates, Johannesburg+ 27 11 8803924 / +27 82 8928052 Qualified Person Information in this report relating to exploration results is based on datareviewed by Mr Christopher Davies BSc, MSc, DIC, FSEG, FAusIMM, OperationsDirector for African Eagle, who is a Fellow of the Australasian Institute ofMining and Metallurgy, has more than 26 years relevant experience in mineralexploration and is a Qualified Person under AIM rules. Mr Davies consents to theinclusion of the information in the form and context in which it appears. Technical terms Hanging Wall - the name given to the host rock of an ore deposit that isphysically above the ore deposit Foot Wall - the name given to the host rock of an ore deposit that is physicallybelow the ore deposit A glossary of other technical terms used by African Eagle in this announcementand other published material may be found at www.africaneagle.co.uk/african-eagle-projects-glossary.html About Mkushi Copper Mines African Eagle's most advanced project, Mkushi is located about 150km southeastof the Zambian Copperbelt. The Company's work, coupled with historical records,suggests that the deposits can be brought into production quickly and operatedprofitably, especially at current high copper prices. The Mkushi Copper Mines Project is a 51/49 Joint Venture between Seringa MiningLtd, a Zambian subsidiary of CGA Mining Limited, and Katanga Resources Limited,African Eagle's Zambian subsidiary. Seringa manages and funds the resourcedrilling and feasibility operations while Katanga manages a jointly-fundedregional exploration programme. A full joint venture agreement between theparties was signed in May 2007, supplanting an earlier heads of agreement. AZambian company, Mkushi Copper Joint Venture Ltd, has been established to ownand operate the project. The style of copper mineralisation at Mkushi is very different from that seen inthe Copperbelt, occurring in association with granitic intrusions within a majorshear zone cutting basement rocks considerably older than the Copperbelt rocks. Copper was discovered at Mkushi in the 1920s and mined by underground operationssporadically until the mid 1960s when an open pit mine was initiated atMunshiwemba. The pit reached a depth of 30m and yielded 2.2Mt of ore at anaverage grade of 1% copper before operations ceased in 1975, because of lowcopper prices and Zambia's programme of nationalisation. The sulphideconcentrate from the operation was sold to a smelter at Nkana in the Copperbelt.In 1990, the parastatal mining company ZCCM estimated that 30Mt of ore grading1.2% copper remained in the ground at Mkushi, with 350 000 tonnes of containedcopper. The project has many advantages. The metallurgy is straightforward and shouldallow excellent recoveries to a clean concentrate with no deleterious elements,at a relatively low capital cost. The area is a brownfield site well served bytransport and other infrastructure - there is a major power line and watersupply within the project area, a network of good gravel roads connecting to arailway and sealed roads within 25km, and an airstrip within 10km. The copperconcentrate produced could easily be shipped to the nearby smelters in theCopperbelt. 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-tracked 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". This information is provided by RNS The company news service from the London Stock Exchange