13 Oct 2009 07:00
Berkeley Mineral Resources Plc
("BMR" or the Company")
Further grant of mining rights to Kabwe Dumps
Following BMR's initial acquisition of mining rights to process zinc and lead from certain tailings dumps at the Kabwe mine in Zambia (contained in the Announcement of 8 July 2008), the Company is pleased to confirm that it has now concluded an additional agreement with Zincorous Investments ("ZIL") a company registered in Zambia, and Dorset Solutions Limited ("DSL"), a company registered in Switzerland, to acquire mining rights to process zinc and lead Dumps 21 and 22 at Kabwe. The resources at these two Dumps are as detailed in the Announcement of 1 October 2009.
Completion will take place upon the receipt of relevant Certificates of ownership from Zambian Consolidated Copper Mines (ZCCM) and other Zambian authorities, which is expected during the next month.
In parallel with the grant of mining rights, BMR has entered into a management agreement, commencing immediately, pursuant to which ZIL and DSL will provide a professional management team for the project for the period up to 1 April 2010 when the operational stage is scheduled to commence. Leading that team as Project Manager is Dennis Human, a geologist and land surveyor who has extensive experience of managing lead, zinc, copper, gold and iron ore start-ups and established projects in South Africa and East and West Africa over the past 25 years, including work at Kabwe.
Masoud Alikhani, Chairman of Berkeley Mineral Resources Plc, commented:
"We have waited until base metal prices have staged a recovery before putting in place the next stage of development at our tailings processing business at Kabwe. We look forward to the commencement of production and are now in negotiations with potential off-take partners for the supply of zinc and lead concentrates.
Demand is increasing for both these metals, notably from the Asian automotive industries where China alone is forecast to manufacture in excess of 10 million vehicles annually in 2009 and beyond. At the same time, the pipeline of world base metals production set to come on-stream, especially of lead, is severely limited".
Notes to editors
BMR is a minerals company with a primary strategy of investing in tailings processing. By accessing dump deposits with known grades and metallurgy, it avoids exploration or mining costs, has a secure licence and fixed environmental criteria, and can produce concentrates according to viability at current market prices.
The Kabwe deposits, located approximately 110km north of the Zambian capital Lusaka, were discovered in 1902. The series of high-grade replacement ore bodies were characterised by coarse sulphide mineralisation (sphalerite/galena) surrounded by an oxidation halo comprising a variety of secondary zinc-lead minerals.
From 1906, Kabwe was a significant mine. By the time it closed in 1994, due to depletion of the massive sulphide mineralisation and lowered metal prices, it had produced about 1.8m tonnes of zinc, 800,000t of lead, 7,800t of vanadium pentoxide and lesser quantities of cadmium, silver and copper. After closure, most of the mine complex was sold off on a piecemeal basis. Berkeley's project is part of an overall plan to re-assemble the Kabwe site into a single entity operating under a single Large Scale Mining Licence.
Today, the waste dumps at Kabwe cover an area of about 1km2 and contain approximately 8m tons of various waste residues with an estimated combined metal content of 455,000t zinc and 368,500t lead.
BMR benefits from the existing infrastructure at Kabwe, including processing plant, good roads, water supply, ample power, local labour and direct on-site connection to overseas markets via international railways to South Africa and to Indian Ocean ports.
For further information please see the Company's website at http://www.bmrplc.com
The directors of Berkeley Mineral Resources accept responsibility for this announcement.
13 October 2009
Contacts:
Masoud Alikhani, Chairman 020 7408 1181
Jonathan Wright, Seymour Pierce 020 7107 8050
Michael Padley / Ron Marshman, Lothbury Financial 020 7011 9411