| Wed 20 Feb 2008, 9:00 | | PAF - Pan African Resources Plc - Pan African Enters Into An Earn-In |
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PAN
PAN
PAF - Pan African Resources Plc - Pan African Enters Into An Earn-In
Agreement For The Kyereboso Exploration Property In Ghana
Pan African Resources PLC
("Pan African" or the "Company")
(Incorporated and registered in England and Wales under Companies Act 1985
with registered number 3937466 on 25 February 2000)
Share code on AIM: PAF
Share code on JSE: PAN
ISIN: GB0004300496
Pan African Enters into an Earn-in Agreement for the Kyereboso Exploration
Property in Ghana
Pan African Resources plc (AIM: PAF, Altx: PAN), the African based mining
and exploration company, announces that it has signed an earn-in agreement
with SEMS Exploration Services Limited ("SEMS") to acquire, in three stages
a 90% interest in the licence rights of the Kyereboso Exploration Property
("Kyereboso") in southern Ghana.
Highlights of the transaction are:
- Acquisition of a substantial exploration property in the vicinity of
the largest gold producer in Ghana
- Close proximity to Akrokerri Exploration project acquired June 2007
- Advanced exploration play with major drill defined exploration targets
The exploration licence covers an area of 16km2. Pan African also has access
to a geological database collected over twelve years, comprising 1070m of
mapped underground adits, soil and stream sampling grids, ground geophysics,
three dimensional structural modelling and 2200m of RC and core drilling.
Some of the highest grade intersections from historical holes drilled on the
property include; 15,2m @ 2.3g/t, 11m @ 3g/t, 13.4m @ 2.3g/t, 31m @ 2.1g/t,
24m @ 5g/t, 3m @ 8.9g/t and 11m @ 3g/t. These intersections represent
continuous mineralisation over runs of 100 to 250m down the several
boreholes over a strike-length of 1.5km.
Pan African will pay SEMS US$200,000 within ten days for an exclusive option
to conduct exploration activity on the property for a period of 12 months
(first exploration phase) and bear the annual costs of approximately
US$15,000 to keep the exploration licence in good standing. After completion
of the first phase of exploration, Pan African shall be entitled, but not
obliged, to proceed to the second exploration phase.
Upon completion of the first exploration phase, by which time the Company
expects to have a robust geological model to assess the prospects of the
project, Pan African will be granted another sole and exclusive right to
explore the property for another 12 months. In consideration for this right,
the Company shall pay SEMS the sum of US$150,000 and issue SEMS 3,000,000
ordinary shares of 1p each, the attributed value of which is to be
calculated based on the volume weighted average trading price on the AIM
Market in the 30 day period preceding the date of issue.
Upon completion of the second exploration phase, and provided that the
Company has not spent less than US$1,000,000 the Company shall have earned
an interest of 50%. Should Pan African have failed to incur a cost of
US$1,000,000 during the first two exploration phases and wishes to proceed
to phase three, then the Company shall have the right, but not the
obligation, to pay SEMS the balance in cash or shares or a combination of
both.
Pan African can acquire a further 20% interest (total interest 70%) from
SEMS up until the completion of a bankable feasibility study ("BFS") for a
consideration of US$400,000. Upon commencement of mine construction the
Company can acquire a further 20% interest (total interest 90%) by paying
SEMS 1,5% of the Net Present Value of the project as determined by the BFS,
as well as granting SEMS a royalty of US$5 per ounce of gold produced for
the first 500,000 ounces, after which the royalty amount will be reviewed
pending economic conditions. The remaining 10% interest in the project will
be transferred upon the commencement of mining to the Ghanaian government as
a free carry, as per Ghanaian mining legislation.
Jan Nelson, CEO of Pan African, said: "The agreement signed to earn-in
allows us flexibility to participate in a highly prospective area contiguous
to the largest gold producer in Ghana, the Obuasi Gold Mine and our
Akrokerri property, allowing for cost effective management of the project."
ENDS
20 February 2008
NOTES TO THE EDITOR
Martin Bevelander, Group Consulting Geologist for Pan African Resources, is
SACNASP (South African Council for Natural Scientific Professions)
accredited and was responsible for reviewing the historical geological data.
For further information on Pan African PLC, please visit the website at
www.panafricanresources.com
Enquiries
Pan African Resources
Jan Nelson / CEO
+27 (0) 82 4945628
Keith Spencer, Chairman
+27 (0) 11 880 3155
+44 (0) 207 851 7480
Ambrian Partners Limited
Richard Brown
+44 (0) 20 7776 6417
Richard Greenfield
+44 (0) 20 7776 6418
Macquarie First South
Corporate Finance (Pty) Ltd
Amanda Markman
+27 (0) 11 343 2307
Done Hattingh
+27 (0) 11 343 2308
St James`s Corporate
Services Limited
Phil Dexter
+44 (0) 20 7499 3916
FD Beachhead
Jennifer Cohen/Louise Brugman
+27 (0) 82 468 6469 / +27 (0) 83 504 1186
Date: 20/02/2008 09:00:01 Produced by the JSE SENS Department.
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