| Fri 6 Feb 2009, 17:26 | | TEL - Teal Exploration & Mining Incorporated - Report for the Three Months Ended |
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TEL
TEL
TEL - Teal Exploration & Mining Incorporated - Report for the Three Months Ended
December 31, 2008
TEAL EXPLORATION & MINING INCORPORATED
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
REPORT FOR THE THREE MONTHS ENDED DECEMBER 31, 2008
HIGHLIGHTS
- TEAL shareholder meeting date set, following the signing of a definitive
agreement between TEAL, ARM and Vale relating to the proposed acquisition
of the shares currently held by TEAL minorities at a price of C$3.00 per
share.
- Pending shareholder acceptance and the satisfaction of other closing
conditions:
- TEAL will be delisted from TSX and JSE;
- ARM and Vale intend to form a 50:50 joint venture to further
develop TEAL`s asset base.
- At Konkola North in Zambia, a total of 4,273 metres of exploration drilling
was completed over the quarter, which included:
- Borehole KN 44: 16.26m from 1,246m depth for 7.38% Cu;
- Borehole KN 46: 12.99m from 1,060m depth for 3.95 Cu;
- Borehole KN 50: 3.42m from 1,028m depth for 2.19% Cu.
TEAL Exploration & Mining Incorporated (TSX-"TL") (JSE-"TEL") ("TEAL" or the
"Company") has informed its shareholders in a Notice of Special Meeting and
Management Proxy Circular mailed on January 23, 2009 that a shareholders meeting
has been scheduled for February 13, 2009.
This follows the announcement, on December 15, 2008, that TEAL had entered into
a definitive agreement with its major shareholder, African Rainbow Minerals
Limited ("ARM") and Companhia Vale do Rio Doce ("Vale") relating to the proposed
acquisition of all of the outstanding common shares of TEAL, not already owned
by ARM, at an offer price of C$3.00 per share. The cash purchase price will be
funded by way of an equity investment by Vale in TEAL. This will result in ARM
and Vale forming a 50:50 joint venture for the future development and operation
of TEAL`s assets.
The offer price represents a premium of: (i) 329% over the closing price, which
was C$0.60, of the TEAL shares on the Toronto Stock Exchange ("TSX") on December
15, 2008; (ii) 822% over the 30-day volume weighted average price of the TEAL
shares on the TSX for the period ended December 15, 2008; and (iii) 879% over
the 20-day volume weighted average price of the TEAL shares on the TSX for the
period ended December 15, 2008.
Completion of the transaction is subject to various conditions, including
receipt of certain regulatory approvals, as well as approval at the special
meeting of the shareholders of TEAL by (i) at least two-thirds of the votes cast
by holders of TEAL shares in attendance at the special meeting by person or by
proxy, and (ii) a simple majority of the votes cast by shareholders other than
ARM and its affiliates. It is also subject to approval by the Supreme Court of
the Yukon Territory in Canada. Subject to these approvals being obtained, TEAL
management expects that the Company will be delisted from the TSX and JSE by the
end of the first quarter of the 2009 calendar year.
The salient dates for South African shareholders are set out below:
2009
Record date to vote at TEAL meeting Wednesday, January 14
TEAL meeting, to be held at 5pm in JHB Friday, February 13
Conversion Reference date Tuesday, February 17
Closing of SA Branch Register for Tuesday, February 17
removal to and from the principal
register
Last day to trade TEAL shares on the Thursday, February 19
JSE in order to be recorded in the SA
Branch Register to become entitled to
receive payment of the Rand equivalent
of the consideration
Suspension of listing of TEAL shares on Friday, February 20
JSE
SA Payment record date for payment of Thursday, February 26
Rand equivalent of consideration
Friday, February 27
Expected SA payment date when the Rand
equivalent of the consideration is
expected to be:
* credited to dematerialised SA
shareholder`s accounts held at their
respective CSDPs or Brokers; or
* transferred or posted to
Certificated SA shareholders
Termination of listing at commencement Monday, March 2
of trading
Share certificates may not be dematerialised or rematerialised after Thursday,
Feb 19 2009.
If any changes to the above dates occur, and announcement will be released on
SENS.
Exploration and Development
On the southern section of the Konkola North property in Zambia, four
exploration drill holes were completed on Area `A` for a total of 4,273 metres
over the last quarter:
- Borehole KN 44*: 16.26m from 1,246m depth for 7.38% TCu, 1.26% ASCu and
0.034% TCo;
- Borehole KN 46*: 12.99m from 1,060m depth for 3.95% TCu, 0.6% ASCu and
0.04% TCo;
- Borehole KN 50*: 3.42m from 1,028m depth for 2.19% TCu, 1.76% ASCu and
0.026% TCo;
- Borehole KN 51: awaiting assay results.
*All true widths
TEAL refers to the two areas at the northern end of the Konkola North property
as the South and East limbs. A revised feasibility study, which is targeting a
2.5Mt a year run-of-mine operation on these two areas, is being finalized.
Existing infrastructure at the South Limb area includes a 423-metre deep,
vertical and concrete lined shaft, with head-frame, two ventilation shafts and
three main access haulage levels, interlinked with several production sub-
levels.
At Kalumines in the Democratic Republic of the Congo ("DRC"), TEAL has focused
its resource definition, feasibility study work and initial mine production on
the Lupoto Copper Project, while exploration drilling is also underway at the
Greater Kasonta Area. Over the last quarter, 198 boreholes were drilled for a
total of 11,895 metres, including shallow stockpile verification drilling,
further drilling at the Lupoto Copper Project, the Kasonta South area and at the
Maga prospect. Phase two drilling at the Lupoto Copper Project has been
completed and 88 boreholes for 15,280 metres were drilled since June 2008 to
verify both strike and down-dip extensions (to 150 metres vertical depth).
Logging and sample processing is in progress. When all assay results are
received for Lupoto, geological modelling and resource definition work will
commence. On the Kasonta South area, 21 boreholes for nearly 4,000 metres have
now been drilled. The geology and the copper mineralization is well defined in
this area and further drilling on 50m x 50m centers is planned in the next field
season.
TEAL`s small-scale mining operation at Lupoto continues at the reduced mining
rate of 50,000m3 a month.
As a result of the scaled-down mining rate and the suspension of deliveries in
terms of certain copper concentrate contracts at the Lupoto Copper Project, TEAL
generated lower revenues for the three months ended December 31, 2008 of US$1.6
million (September 30, 2008: US$3.9 million). After adjusting stock to net
realizable value, it resulted in a negative contribution from sales of US$14
million (US$0.4 million - contribution). After other expenses, principally
exploration and development costs of US$7.2 million (US$10.2 million), the net
loss amounted to US$37.2 million (US$14.1 million - loss), or US$0.69 loss per
share (US$0.26 - loss per share).
As at December 31, 2008, the Company had available cash of US$0.8 million. TEAL
has fully utilized the unsecured US$85 million loan facility, which is repayable
on August 31, 2009 and which is guaranteed by ARM. TEAL has received a letter of
financial support from ARM, which provides the Company with financial assistance
amounting to ZAR385 million up to September 30, 2009. This will allow the
Company to cover liabilities and commitments in the ordinary course of business.
Amounts totaling ZAR115 million, equivalent to $11.6 million, were drawn on this
facility by December 31, 2008.
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 the DRC, Zambia, Namibia, and Mozambique. 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.
For further details contact:
Julian Gwillim (VP: Investor Relations and Corporate Development) on
+27 (0) 82 4524 389; or julian@tealmining.com
Forward-Looking Information: Statements contained in this news release that are
not historical facts are forward-looking statements that involve risks,
uncertainties and other factors that could cause actual results, performance,
prospects and opportunities to differ materially from those expressed or implied
by such forward-looking statements. Although TEAL believes that the assumptions
inherent in the forward-looking statements are reasonable, undue reliance should
not be placed on these statements, which only apply as of the date of this press
release. TEAL disclaims any intention or obligation to update or revise any
forward-looking statement, whether as a result of new information, future events
or otherwise. This press release shall not constitute an offer to sell or the
solicitation of an offer to buy securities of TEAL in any jurisdiction.
6 February 2009
Sponsor: Investec Bank Limited
Date: 06/02/2009 17:26:01 Produced by the JSE SENS Department.
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