GCM Resources Regulatory News (GCM)

21 Dec 2006 07:00

Asia Energy PLC21 December 2006 PRESS RELEASE 21 December 2006 Asia Energy plc acquires 15% of current share capital of GVM Metals Limited For immediate release: Asia Energy Plc ("Asia Energy" or "the Company") (AIM:AEN) announces it has acquired 12,200,000 new ordinary shares in GVM MetalsLimited ("GVM"), a South African mineral processing and coal mining company, byway of a subscription at 20 pence per share, for a total cost of £2,440,000. TheBoard of GVM has invited Steve Bywater to become Non-Executive Deputy Chairmanand Graham Taggart to be a Non-Executive Director. Following the subscription,Asia Energy will own 13% of the enlarged share capital of GVM. The investment provides the Company with a meaningful stake in the South Africancoal sector and the opportunity to assist development of an underground coalmine (Holfontein project) and two open-cut coal mines (Limpopo and Baobabprojects) in South Africa. The Holfontein project is located in the Witbank coalfields and the Baobab and Limpopo projects are located in the Limpopo province.Based on previous work undertaken by Utah Mining, Kumba and others the totalcoal resources controlled by GVM are considered to approach 2 billion tonnes. GVM's primary listing is on the Australian Stock Exchange (ASX) with secondarylistings on London's Alternative Investment Market (AIM) and the JohannesburgStock Exchange (JSE). As a result of two recently announced transactions, GVM will hold onsatisfaction of all conditions precedent a 100% interest in both the Baobab andHolfontein coal projects. On 22 August 2006, GVM announced the acquisition from Motjoli Resources(Proprietary) Limited ("Motjoli") of its 51% shareholding in the HolfonteinProject, its 50% interest in the Baobab Project, and its 100% interest in threeprospecting licences adjacent to the Baobab properties. Yesterday GVM announced it had reached agreement with Petmin Limited ("Petmin")for GVM to acquire Petmin's effective 50% interest in Baobab for GBP 2.5million. GVM plans to bring the Holfontein mine into production in the first half of2008. A bankable feasibility study on the Limpopo and Baobab Projects isexpected to be completed by December 2007 with coal production expected in thefirst half of 2009. All GVM's mining and prospecting interests are held as NewOrder rights. As a result of the Motjoli transaction GVM will qualify as black empowered underthe relevant South African legislation. GVM also holds 100% of NiMag (Proprietary) Limited ("Nimag"), an alloy and fibremanufacturer based in Magaliesburg near Johannesburg in South Africa. Nimagsupplies approximately 40% of world demand for nickel magnesium ferro-alloys. Further details of the above transactions and description of the assets areavailable on GVM's website (www.gvm.com.au). Steve Bywater Chief Executive of the Company said: "This is an excitingopportunity for Asia Energy as it looks to expand its portfolio of investmentsin coal on a global basis. This transaction provides a platform for the Companyto be involved in new and developing coal projects with GVM, who have a strongmanagement team. The Company remains, however, fully committed to its PhulbariCoal Project in Bangladesh and we will update the market on its status as soonas we are able." Simon Farrell, Managing director of GVM said: "We are delighted to work withAsia Energy bringing our diverse coal interests into production. Steve Bywaterbrings enormous experience in operating world class coal and iron ore mines andI look forward to his help in what is going to be a very exciting andchallenging period of the company's growth". For Further Information: Steve Bywater Cathy Malins or Annabel LeatherChief Executive Parkgreen CommunicationsPh: +44 (0)207 290 1630 Ph: +44 (0)207 851 7480 Graham TaggartFinance DirectorPh: +44 (0)207 290 1630 Notes to editors: Asia Energy: Asia Energy plc is a London based company quoted on the London Stock Exchange'sAlternative Investment Market (AIM). The Company's primary activity is thedevelopment of the Phulbari Coal Project in Northwest Bangladesh into a worldclass open pit mine, adhering to the highest national and internationalenvironmental and social standards. The mine will have a life of more than 30years and at full capacity will produce 15 million tonnes a year of mostlyexport quality metallurgical and thermal coal. Its objective is to start miningactivity upon Government of Bangladesh approval following the Governmentelection in January 2007. For further information on the Company: www.asia-energy.com GVM Metals: GVM Metals Limited listed on the Australian Stock Exchange in April 1980 and wasprimarily focused on minerals exploration in Western Australia and Indonesia.Through a series of strategic investments, GVM moved its focus to a metalsprocessing and coal processing company predominantly targeting South Africa. Thecompany successfully listed on Aim in 2005 and also on the Johannesburg StockExchange in November 2006. For further information on the Company: www.gvm.com.au This information is provided by RNS The company news service from the London Stock Exchange