1 Aug 2011 07:00
1st August, 2011
Polo Resources Limited("Polo" or "the Company")
POLO PURCHASES 51% interest in AXMIN INC.'S sierra Leone Assets
for US$7.5 million
Polo Resources Limited (AIM and TSX: POL) today announces that it has entered into an agreement (the "Agreement") with TSX listed Axmin Inc. ("Axmin") whereby Polo will acquire a 51% interest in a new company which will own AXMIN's Sierra Leone Gold assets (Nimini East and West and Matotoka Exploration Licences - the 'Prospects'), for a cash consideration of US$7.5 million which will be payable on completion. Axmin will retain a 49% interest in the new company.
Completion of the transaction is subject to technical and legal due diligence to be undertaken by Polo which shall be completed within 60 days from the 1st August 2011. At completion, Polo and Axmin intend to enter into a shareholders agreement to govern their joint venture.
Polo, under the terms of the Agreement, will solely fund the first US$2 million of the project exploration expenditures after which both parties are to jointly fund exploration expenditures on a pro rata basis. Parties who elect not to participate will face dilution of their respective interest in the project.
Information on the Project
The Prospect Area is situated in the central-west Kono region of Sierra Leone, some 330 km east of the capital Freetown. The principal asset is the Komahun Gold Prospect ("Komahun") which is located within the Nimini Hills West Licence. Komahun has an Indicated Mineral Resource of 370,000 tonnes grading 9.1 g/t Au (110,000 ounces) and an Inferred Mineral Resource of 3.1 million tonnes grading 4.3 g/t Au (435,000 ounces).
The in-situ mineral resource, estimated at a plus 1.8 g/t Au cutoff, was undertaken by SRK using robust three dimensional interpretations with grade interpolation carried out using Ordinary Kriging. The cut-off grade reflects modelling parameters suitable for underground mining. The remaining licences in Sierra Leone, being Nimini Hills East and Matotoka are both at an early stage of exploration.
In March 2009, Axmin announced the results of a Preliminary Economic Assessment and Scoping Study (the "Scoping Study") for Komahun. The Scoping Study demonstrated that Komahun has potential for development as an underground gold mine with target production levels of about 50,000 ounces per annum, with a present estimated 6 year mine life. In addition, economics for the Prospect could be substantially enhanced by future exploration success that is targeting the immediate vertical extensions to the ore body which remain open beyond the currently investigated depth of 350 metres beneath surface.
In December 2010, the Matotoka Exploration Licence was renewed for a period of two years, until December 2012. Additionally, in April 2011, the Nimini Hills East and West Exploration Licences were granted for a two year period, until March 2013.
Further information on Komahun can be found on Axmin's website at the following address:
http://www.axmininc.com/site/OperationsProjectsnbsp/AdvancedProjects/KomahunGoldProject.aspx
Executive Co-Chairman and Managing Director of Polo, Mr. Neil Herbert said,
"These are excellent gold Prospects and we are very pleased to be working on them with Axmin. This investment further develops Polo's investment portfolio and we see significant upside potential from these Prospects resulting in value for shareholders."
For further information, please contact:
Polo Resources Limited Neil L. Herbert, Executive Co-Chairman Ian Burns, Finance Director |
+ 2782 404 36 37 |
Evolution Securities Matthew Tyler, Romil Patel, Jeremy Ellis |
+44 (0) 20 7071 4300 |
Blythe Weigh Communications Tim Blythe Ana Ribeiro Matthew Neal | +44 (0) 207 138 3204
|
Toronto Heenan Blaikie LLP Wes Roberts | +1 416 360 2606
|
About the Company
Polo Resources is a natural resources investment company focused on investing in undervalued companies and projects with strong fundamentals and attractive growth prospects. The Company will primarily invest in companies with producing assets and/or resources and reserves that have been verified under internationally recognised reporting standards. For complete details on Polo Resources: www.poloresources.com.
About AXMIN
AXMIN is a Canadian exploration and development company with a strong focus on central and West Africa. AXMIN has projects in Central African Republic, Mali, Mozambique, Sierra Leone and Senegal. AXMIN is positioned to grow in value as it progresses its Passendro Gold Project towards development and builds on its project pipeline focusing on transitioning from an explorer to producer. For more information regarding AXMIN visit our website at www.axmininc.com.
CAUTIONARY STATEMENT
The AIM Market of London Stock Exchange plc does not accept responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. All statements, other than statements of historical fact, in this news release are forward-looking statements that involve various risks and uncertainties, including, without limitation, statements regarding potential values, the future plans and objectives of Polo Resources Limited. There can be no assurance that such statements will prove to be accurate, achievable or recognizable in the near term.
Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Polo Resources Limited assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.