Last checked at 15 Sep 2011 11:31
Hambledon Mining plc
Acquisition of Akmola Gold LLP
Hambledon Mining plc ("Hambledon Mining" or "Company")(AIM: HMB), the Kazakhstan gold mining and development company, today announces that it has entered into anagreement for the purchase of 100% of Akmola Gold LLP ("Akmola Gold"), subject to certain government waivers and consents. The vendors are Central Asian Gold Corporation and Mr Yerkin Sadykov, who each have a beneficial interest of 50% in Akmola Gold.
Highlights
Acquisition of two wholly owned precious metals projects, Tellur and Stepok, both situated in central Kazakhstan, some 140 km North of Astana; Combined resources of some 440,000 ounces of gold plus silver and other metals, with considerable up-side potential after further drilling; Total consideration is US$5 million, payable fifty per cent in cash and fifty per cent. in ordinary shares of the Company; Tellur is an underground mine with a resource totaling over 140,000 ounces of gold at an average grade of over 17 g/t and is expected to be in production before the end of Q2 2013; Stepok is an advanced exploration project with estimated resources of some 300,000 ounces of gold together with significant quantities of copper, lead and zinc. Appointment of considerable expertise in the form of Steve Wilson and Mathew Allen, two senior technical and planning staff.Tim Daffern, CEO of Hambledon said "the new acquisitions fit well with Sekisovskoye. Taken together with the ongoing development of the underground mine at Sekisovskoye, the Group is now poised to become a growing gold producer with diversified production from more than one mine. Gold production is expected to rise progressively over the next five years. With our new appointments, we are putting in place the skills we need for the development of our expanding group."
Akmola Gold holds the subsoil-use rights for two wholly owned projects in Central Kazakhstan, known as Tellur and Stepok, together containing around 440,000 ounces of gold resources, along with potentially significant credits from copper, lead and zinc. The acquisition is subject to the government's pre-emptive right to acquire on the same terms as Hambledon are offering and on certain other required consents.
Tellur
Tellur is a high grade underground mine containing approximately 260,000 tonnes ore at a grade of over 17g/t of gold, giving a resource of over 140,000 ounces of gold. The attraction of Tellur to the Company is that it is well explored, partially developed and can be brought into production as early as the second quarter of 2013. The ore can be transported to Sekisovskoye for treatment in the Company's existing plant, allowing low cost treatment and, because of its high grade, providing a substantial boost to the Company's gold production potential. Subject to further study, the Company envisages producing around 50,000 tonnes per year. This would potentially yield an additional 20,000 ounces of gold per annum once the mine is at a steady state in mid-2014. The operating cost is expected to be as low as US$$600 per ounce as a result of the high grade and because only marginal additional treatment costs will be incurred at the already operating Sekisovskoye treatment plant.
Stepok
Stepok is an advanced exploration project which is located within the prolific Aksu-Bestobe-Zholombet gold district, some three kilometres north of Tellur. Stepok contains estimated measured and indicated resources, equivalent to some 300,000 ounces of gold. The mineralisation also contains quantities of copper lead and zinc. Development of Stepok will take longer than for Tellur as the project is less advanced and the metallurgy more complex. Around three to four years will be needed to carry out additional resource delineation drilling and a bankable feasibility study. A drill programme of some 65,000m is planned, as it is believed that a significant increase in the resource can be discovered at depth and along strike. Mining will be by open pit, for which the mining fleet from Sekisovskoye will by then be available. A hybrid processing plant, including flotation and specialised cyanidation, will be required to produce gold doré and extract concentrates for copper, lead and zinc. The resource is currently sufficient to justify annual production of approximately 1m tonnes per annum, potentially yielding 30,000 ounces of gold and 40,000 ounces of silver per annum.
It is anticipated that after further exploration, the resource at Stepok could be expanded sufficiently to justify a doubling of output to to 2m tonnes per annum, thereby doubling the gold output to 60,000 ounces per annum.
Consideration
The total consideration for Akmola Gold is US$5 million, US$2. 5 million being payable in cash and the balance being satisfied by the issue of ordinary shares of the Company ("Consideration Shares") The consideration will only be satisfied once all the conditions have been met. The Consideration Shares will be priced at the average closing price , in US dollars, for the preceding ten days prior to this announcement. Under the terms of a lock-in agreement, the vendors will not, without the consent of the Company, sell the Consideration Shares for a period of six months following completion of the acquisition of Akmola Gold and, for a further period of six months, will only sell the Consideration Shares through the Company's retained brokers.
Recruitment
In order to provide additional technical resources for the development of the newly acquired projects together with the on-going development of the Sekisovskoye underground project, the Company has recruited two senior technical and planning staff. Steve Wilson has been appointed to be the new head of group technical and planning services. Steve is a mining engineer with extensive process engineering experience and specific skills in paste technology. He was formerly a project manager with Golders Associates. Mathew Allen has been appointed as group metallurgist. He is a geologist with post graduate qualifications in mineral processing. He has previous experience in operations and has skills in process evaluation through laboratory work with Wardell Armstrong International.
ENQUIRIES:
HAMBLEDON MINING: Telephone +44 (0)207 233 1462Charles Zorab
FAIRFAX I.S. PLC: Telephone +44 (0)207 598 5368Ewan Leggat/Katy Birkin
TAVISTOCK COMMUNICATIONS: Telephone +44 (0) 207 920 3150Ed Portman/Jos Simson
Copyright Business Wire 2011