African Eagle Resources Regulatory News (AFE)

3 May 2007 09:01

African Eagle Resources PLC03 May 2007 AFRICAN EAGLE AGREE TO JOINT VENTURE WITH RANDGOLD RESOURCES ON THE MIYABI GOLD PROJECT IN TANZANIA •Option and farm-in agreement signed between African Eagle and Randgold Resources •Randgold will fund, perform and accomplish a pre-feasibility study to earn a 50% interest in the Miyabi project •African Eagle can then retain a 49% stake in the Project by co-funding a full feasibility study, or dilute to 35% •Randgold to arrange development finance on a production decision African Eagle Resources plc ("African Eagle" or "the Company", ticker AIM: AFE)today announces that it has entered into a Joint Venture with a wholly-ownedsubsidiary of Randgold Resources ("Randgold") on its +500,000 ounce Miyabi GoldProject in the Lake Victoria Goldfield of Tanzania. The Joint Venture has the form of an option and farm-in agreement. Under theinitial option, Randgold will carry out and fund an agreed phase-1 explorationprogramme by end of May 2008. This programme will consist principally of aseries of diamond drill hole fence lines to investigate the geology, structureand controls on mineralisation across the width of the Miyabi corridor. Randgoldwill then have the right to earn a 50% interest in the project by conducting andfunding a pre-feasibility study to agreed parameters. Following thepre-feasibility study, African Eagle can retain a 49% stake in the Project byco-funding a full feasibility study, or dilute to a 35% stake if Randgoldprovides the funding in full. Randgold, as Project Manager will also arrange thefinancing for the development of a mine. Randgold Resources is an Africa-focussed international gold mining andexploration business with listings on the London and New York Nasdaq exchanges.Randgold has a strong track-record of exploration and development successincluding the 7.5 million ounce Morila deposit in southern Mali, the six-plusmillion ounce Yalea deposit at Loulo in western Mali and the three million ounceTongon deposit in Cote d'Ivoire. Randgold successfully financed and developedthe Morila mine, which has produced more than four million ounces of gold sinceit was brought into production in October 2000. It also financed and developedthe Loulo Mine which was officially opened in November 2005 and is scheduled toproduce 250,000 ounces per year for six years, from an open pit operation.Development of the Loulo underground operation has commenced and willsignificantly enhance the value and extend the life of mine. Randgold recentlycompleted a pre-feasibility study on the Tongon deposit and holds a portfolio ofexploration projects in Mali, Cote d'Ivoire, Senegal, Burkina Faso, Ghana andTanzania. African Eagle's Managing Director Mark Parker commented "We are delighted tohave signed one of Africa's most exciting and successful gold companies, as ourpartner at Miyabi. Randgold has a strong mining and geological team and AfricanEagle will benefit enormously from this additional expertise in evaluating theMiyabi project and taking it through to production. We look forward to makingswift progress with Randgold on the Miyabi project". John ParkChairman 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 Ed Portman/ Leesa PetersConduit PR+44 20 7429 6607 / +44 (0) 7733 635 01 Qualified PersonInformation in this report relating to exploration results is based on datareviewed by Mr Christopher Davies BSc, MSc, DIC, Operations Director for AfricanEagle, who is a Fellow of the Australasian Institute of Mining and Metallurgy,has more than 25 years relevant experience in mineral exploration and is aQualified Person under AIM rules. Mr Davies consents to the inclusion of theinformation in the form and context in which it appears.Technical termsA glossary of technical terms used by African Eagle in this announcement andother published material may be found at www.africaneagle.co.uk/african-eagle-projects-glossary.htmlAbout Miyabi The Miyabi Gold Project lies in the southwest part of the Lake VictoriaGoldfield of Tanzania, about 50km west-southwest of Kahama township in ShinyangaDistrict. The gold system at Miyabi, discovered by African Eagle's geochemicalprospecting team, forms a corridor of about 7km x 2km associated with a majorshear zone cutting greenstone and granite rocks, within which occur a number ofgold mineralised zones. To date, African Eagle's drilling has delineated fiveprincipal orebodies: Faida, Shambani Main and North, Ngaya and Kilimani. In early 2006, the Company commissioned SRK Consulting Ltd to conduct a formalresource estimate based on all drill results to date. The total JORC compliantMineral Resource was estimated to be 12.4Mt at a grade of 1.3g/t, containing520,000 ounces of gold, using a cut-off grade of 0.5g/t, which is appropriate toTanzanian deposits of the Miyabi type. Of this, 71% is in the Indicatedcategory. Independent metallurgical testing of systematically selected gold-bearing drillsamples representative of all of the principal mineralised zones at Miyabishowed that standard leaching recovers 95% of the gold from the ore. The potential for adding to the gold resource at Miyabi is very good, with manytargets identified from geophysical and geochemical surveys within the mainmineralised corridor remaining to be drilled, and African Eagle believes thatthe project could hold at least one million ounces. The Company's prospecting licences also cover more than 500 square kilometres ofhighly prospective granite-greenstone terrain around the main mineralisedcorridor and regional exploration of these areas has identified severalpromising targets. The Idahina East prospect, for example, yielded a geochemicalsoil gold anomaly in excess of 0.5 g/t which has yet to be drill tested. 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 prioritised 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