CRC.L Regulatory News (CRC)

30 Nov 2005 07:03

COPPER RESOURCES CORPORATION ("CRC" or "the Company") COPPER RESOURCES ACQUIRES MMK IN KATANGA PROVINCE OF CONGO TO BECOME PRODUCER IN 12-18 MONTHS FROM HIGH-GRADE 5.3% COPPER ORE BODY AT KINSENDA MINE Copper Resources Corporation (AIM: "CRC") has concluded on schedule the finalagreement envisaged by an MOU signed in September and acquired 75% of MiniĬrede Musoshi et Kinsenda ("MMK") which holds three high-grade deposits in theDemo-cratic Republic of Congo, located in the south of Katanga Province nearthe Zambian border, as follows: Deposit Copper Content Grade Meters Drilled Tonnes Billion lbs. Kinsenda 840,000 1.9 5.3% 66,000 Musoshi 580,000 1.3 2.4% 30,000 Lubembe 1,000,000 2.2 2.2% 12,000 Total 2,420,000 5.3 With this acquisition CRC has embarked on a US$5 million dewatering program ofthe Kinsenda mine where production is expected to commence in 12-18 months.Kinsenda will produce 40,000 tonnes per annum of copper content in the form ofa rich, 45% concentrate from the high-grade 5.3% ore body. In the interim, CRCwill produce 4,000 tonnes per annum of copper matte (95% copper content) in theMusoshi arc furnace, which is currently in operation.The Kinsenda and Musoshi deposits were mined from 1968-1983 bya Japanese mining consortium, then by Canadian management on behalf of theZairian government from 1983-1987, and subsequently by Gecamines, a Congolesestate mining company. Kinsenda and Musoshi are both currently flooded andrequire dewatering prior to restarting operations; Lubembe is a green fieldexploration property with high potential. All three deposits have beendrilled, Musoshi and Kinsenda extensively, and Lubembe not to the same degree.The MMK acquisition is attractive as it represents 5.3 billion pounds ofcontained copper at a cost 1/5th of a US cent per pound.The remaining 25% of MMK is held 20% by SODIMICO, a state company, and 5% bythe Forrest Group, the largest private business in Katanga and one of thelargest in Congo with diversified operations including mining, engineering,construction, and cement. Operating successfully in Congo since 1922, theForrest Group has extensive operational and management experience in thecountry that will support and facilitate CRC's effort in developing theproperties.In exchange for the 75% shareholding in MMK, CRC is issuing18,717,734 new shares and 1,300,000 options at an exercise price of 75p to theForrest Group, which becomes its largest shareholder group, with a 40% stake inCRC. In line with this shareholding, the CRC board has been restructured,increasing from six to eight directors: three directors re-main (Sir Sam Jonah,Non-executive Chairman; Mitchell Alland, Executive Vice Chairman; ChristopherJordinson, Director and CEO) while three have re-signed (James Frank, EliaCrespo, Rebecca Taylor) to allow representation of the Forrest Group and tobring in new directors independent of any of the CRC investment groups. Thefollowing new directors have joined the board to represent the Forrest Group,and each will be issued 125,000 options at an exercise price of 75p: * George Arthur Forrest (Non-Executive Vice Chairman) - Mr. Forrest has been Chairman of Forrest Group for over fifteen years. * Michel Anastassiou (Director) - Managing Director of George Forrest Internation-al Afrique sprl ("GFIA"). Mr. Anastassiou has been in this position for over ten years. * George Andrew Forrest (Director) - Deputy Secretary-General, GFIA. Mr. Forrest has been in this position for three years. In addition, there will be two independent directors who will each be issued100,000 options at an exercise price of 75p: * Roger Marshall, OBE (Director) - Mr. Marshall has been involved in mining for over 30 years, and was awarded an OBE for his services to the Australian Mining industry. * Director - To be appointed. Mr. George Forrest, Chairman of the Forrest Group, said: "We are lookingforward to working with CRC and jointly accelerating the start of productionfrom the MMK deposits. We are also looking forward to working with the CRCteam in the context of a public company that could become the vehicle for otherextensive mining operations in the future."At Musoshi there is a plant that includes crushers, grinders, floatation tanksand an ore concentrator with the capacity 2,500 tpd. The equipment will needto be refurbished prior to commencing operations. The MMK concession area hasextensive infrastructure including roads, water, staff accommodation and power.The power infrastructure includes 220/110Kva lines to both Kinsenda andMusoshi, as well as a substation at Musoshi with generators for backup.The CRC program is designed to start production at Kinsenda in 6-9 months afterthe dewatering of the mine which will cost about $5 million to complete;another US$30 million will be required to refurbish andregenerate the Kinsenda mine and Musoshi concentrator.CRC has issued 200,000 shares to Sir Sam Jonah, Non-executive Chairman, ascom-pen-sation for the successful completion of the transaction.Mitchell Alland, CRC Executive Vice Chairman stated: "The MMK acquisitionoffers an exceptional opportunity, placing CRC on a fast track to become asignificant producer with world class deposits in partnership with the ForrestGroup who have been active in the Congo for over eighty years, and are thepremier private group in the country."For further information please contact: Copper Resources Nabarro Wells & Westhouse GTH Communications Corporation Co. Securities Mitchell Alland Keith Smith Richard Morrison Toby Hall Executive Vice Chairman +44 (0) +44 (0) +44(0) +44 (0) 77 4801 8690 20 7710 7400 20 7601 6100 20 7153 8035 ENDCOPPER RESOURCES CORPORATION