| Fri 31 Aug 2007, 17:05 | | TEL - TEAL Exploration & Mining Inc - Increased mi |
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TEL
TEL
TEL - TEAL Exploration & Mining Inc - Increased mining rate for Kalumines and
Konkola North Techncial study completed
TEAL Exploration & Mining Inc.
Corporate Access Number: 31403
ISIN: CA8781511099
(Incorporated in Yukon, Canada on 1 June 2005)
SA Company Registration Number: 2006/003229/10
JSE share code: TEL
JSE short name: TEAL
Friday, August 31, 2007
INCREASED MINING RATE FOR KALUMINES AND KONKOLA NORTH TECHNCIAL STUDY COMPLETED
* Rapid build-up of copper mining at Kalumines in the DRC
* TEAL Metals furnace installed in the DRC and being commissioned
* Technical aspects of a feasibility study for the Konkola North Copper
Project in Zambia completed
* Otjikoto`s Inferred gold resource in Namibia nears the two million ounce
target
* Options for the Mwambashi Copper Project in Zambia being reviewed
* Major shareholder agrees to guarantee an increase and
extension of existing bridge loan facility
In releasing results for the three and twelve months ended June 30, 2007, TEAL
Exploration & Mining Incorporated (TSX-"TL") (JSE-"TEL") ("TEAL" or the
"Company") has announced an increased mining rate at its mine being commissioned
in the Democratic Republic of Congo ("DRC"). Furthermore, the technical aspects
of the feasibility study for the Konkola North Copper Project in Zambia have
been completed indicating a mine capable of producing 25,000 tonnes a year of
contained copper.
It was announced on May 15, 2007 that mining at the Lupoto prospect, which forms
part of TEAL`s Kasonta-Lupoto Mines ("Kalumines") Copper-Cobalt Project, had
started. At the time of the announcement, the Company was anticipating a mining
operation at a rate of 70,000m3 per month, which would produce over 20,000
tonnes per year of concentrate. These targets have subsequently been revised
and monthly planned production is now building-up to 110,000m3, producing 40,000
tonnes of mineralized material per month. From this, 3,200 tonnes per month of
concentrate will be produced grading between 20% and 25% copper, containing
approximately 10,000 tonnes of copper per year.
TEAL Metals (DRC) s.p.r.l. ("TEAL Metals") will purchase all the concentrates
from Kalumines and feed its furnace at a rate of 1,800 tonnes per month. This
furnace, which is in the process of commissioning, has a capacity to produce
approximately 5,000 tonnes per year of `black copper` ingots with a grading of
85% to 95% copper.
The surplus concentrates, some 1,400 tonnes per month, will be sold to various
other smelter operators in the DRC, in particular, to Societe Miniere du Katanga
s.p.r.l. ("Somika") with whom TEAL Metals has formed a joint venture to process
the material at Somika`s facilities until December 2007. TEAL Metals will
contribute the concentrate, while Somika will contribute all costs of operation,
and profits will be shared on an equal basis.
A feasibility study on a larger open pit mining operation at Lupoto, together
with a dedicated processing facility, is in progress and is scheduled for
completion after the verification and in-fill resource drilling, as well as the
metallurgical test-work, has been concluded.
The first results from the exploration drilling program at Lupoto were announced
on July 11, 2007. TEAL is conducting a 5,200 metre exploration drilling program
on the property to verify and update the historical resource. TEAL has drilled
nearly 4,200 metres to date on the Lupoto area comprising 31 reverse circulation
and 23 diamond core boreholes. Borehole R-001 has confirmed the historical
interpretation of the upper zones of mineralization as 2.7 metres grading 11.20%
copper, and 13 metres at 6.44% copper on the eastern limb of the main Lupoto
structure. Additional drilling information is being geologically logged and
interpreted. TEAL believes the mineralization is open ended at depth and on
strike, and current drilling is targeting the shallow (above approximately 100
metres depth) and predominately oxide copper enrichment.
The technical aspects of the Konkola North Copper Project feasibility study,
based on an operation to exploit the South and East Limb areas of the orebody,
have been completed. The study has confirmed the practicality of utilizing the
existing shaft to gain rapid access to the orebody and mining first in the South
Limb area, followed by the East Limb. The Konkola North mine is forecast to
produce 1,250,000 tonnes per year of run-of-mine ore, predominantly using the
sub-level open stoping as well as room-and-pillar mining methods, for an
expected build-up to an average production over the 16-year life of mine of
25,000 tonnes of contained copper per year. The life of mine production
contained in the study is forecast at 17.9 million tonnes of ore grading 2.16%
copper. It remains the intention to assess the viability of a dedicated
processing facility for Konkola North and this will be analyzed as a separate
project following the completion and approval of the current study, which is
expected following the conclusion of the remaining aspects to take this study to
a bankable level.
The Board of Directors has approved expenditure of US$1.5 million for the
Konkola North Copper Project. These funds will be used to secure long lead
items, such as the electrification for the mine winder system, upgrading of the
mine power supply to the mine, and the detailed design of the steelwork sections
in the shaft that requires replacement. The mining contractor will also be
appointed and underground rehabilitation work will continue, which will allow
mining to commence as soon as the mine winders have been installed.
TEAL is conducting a pre-feasibility study on the Otjikoto Gold Project and
completion of this study is anticipated in early 2008. Following a positive
conclusion, this will lead to the immediate initiation of a bankable feasibility
study with the goal of fast tracking the Otjikoto Gold Project to a possible
mine development decision.
TEAL recently completed an interim phase of geological modelling and
geostatistical evaluation from its ongoing phase of drilling of the Otjikoto
deposit. The current total combined Inferred resource estimate has increased by
35% to 44 million tonnes at 1.246g/t, providing 1.76 million ounces of gold.
Results from boreholes TC23, TC40 and OT152 have confirmed, and extended, high
grade zones of mineralization. TC23 returned 18.90m grading 3.05 g/t gold, TC40
16.20m grading 9.54 g/t gold and OT152 returned 13.50m at 6.46 g/t gold. This
represents an increase of 460,000 ounces from the previous 1.3 million ounces,
which was audited and supported by SRK Consulting in February, 2007. The
additional ounces have resulted from the intersection of extensions to the
mineralization to the eastern and southern areas of the deposit.
The feasibility study for the Mwambashi Copper Project was largely completed in
August 2006, and development has remained subject to an off-take arrangement for
the treatment of the Mwambashi copper ore, which is primarily oxide-based in the
early years of the mine life. Although the process to conclude an off-take
agreement advanced over the last year, management has not secured suitable terms
to the benefit of the Company. TEAL is now assessing various alternatives.
As at end June 30, 2007, TEAL`s cash resources amounted to US$5.9 million, and
the Company also had access to an additional US$10 million remaining from a
one-year US$20 million bridge loan facility entered into during the financial
year under review, which is being guaranteed by TEAL`s major shareholder,
African Rainbow Minerals Limited ("ARM"). Subsequent to year-end, ARM has
agreed to increase the guarantee to $50 million, subject to South African
Reserve Bank approval, which will ensure that TEAL has a facility in place
beyond the end of the 2008 financial year or until long-term funding is
arranged. TEAL is currently negotiating the terms, including an extension
beyond the one-year time-frame, with Standard Chartered Bank. These funds
will be directed towards work to support studies on the core projects: the
Konkola North and Kalumines copper projects, as well as the Otjikoto Gold
Project. Funding for the capital expenditure at Konkola North, Kalumines
and Otjikoto will be pursued after the completion of the final feasibility
studies.
The Company recorded a consolidated net loss for the three months ended June 30,
2007 of $8.6 million, or $0.16 cents per share, which compares to a net loss for
March 31, 2007 of $9.6 million, or $0.18 loss per share. Over the twelve month
period, TEAL reported a net loss of $27.3 million or $0.51 cents per share. This
compares to a net loss of $9.0 million, or $0.27 cents per share, for the twelve
months ended June 30, 2006. This year-on-year increase is indicative of the
accelerated expenditure that occurred over the last year on exploration drilling
programs, project development and the commencement of mining in the DRC.
TEAL`s Chief Financial Officer, Mr. Hannes Otto Meyer (37), the Company`s Chief
Operating Officer, Mr. Arne Nicolaas Lewis (38), as well as ARM`s Executive:
Business Development, Africa, Mr. Daniel Simelane (45), have been appointed to
the Board.
Mr. Claus Schlegel, Pr. Sci. Nat. (No. 400149/90), TEAL`s Vice President:
Exploration and Business Development, is the "qualified person" for the content
of this press release for purposes of National Instrument 43-101.
ends
NOTE:
TEAL is incorporated under the laws of the Yukon, Canada and its common shares
are listed on the Toronto Stock Exchange ("TSX") and the JSE Limited ("JSE").
The common shares of the Company trade under the symbol "TL" on the TSX and
"TEL" on the JSE.
TEAL is a mineral development and exploration company with development projects
and exploration areas in Namibia, Zambia and the Democratic Republic of Congo
("DRC"). TEAL has a portfolio of base and precious metal development projects
and complementary exploration areas, and the Company continues to seek other
opportunities, mainly in southern and central Africa.
TEAL has targeted specific projects: the Konkola North Copper Project in Zambia;
the Otjikoto Gold Project in Namibia; and the Kalumines Copper-Cobalt Project in
the DRC. TEAL also has interests in various other mineral licence areas in
Zambia and in Namibia on which the Company continues drilling and other
exploration activities.
A copy of TEAL`s Annual Financial Statements and the MD&A are available at
www.sedar.com as well as at www.tealmining.com
For further details contact:
Julian Gwillim (VP: Investor Relations and Corporate Development) on
+1 416 828 1422 (Canada); or +27 82 4524 389 (SA); or julian@tealmining.com,
or
Rick Menell (President and CEO) on +27 82 450 2301; or rick@tealmining.com.
Date: 31/08/2007 17:05:10 Produced by the JSE SENS Department.
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