KUMBA RESOURCES AND AMZ IN JOINT VENTURE TO REHABILITATE KIPUSHI IN THE DRC
America Mineral Fields ("AMZ") and Zinc Corporation of South Africa
("Zincor"), a wholly owned subsidiary of Kumba Resources Limited ("Kumba"),
are pleased to announce the signing of a joint venture agreement which will
govern the potential rehabilitation of the Kipushi zinc-copper mine in the
Democratic Republic of Congo ("DRC").
The mine, which is situated in the Katanga province of the DRC, some 30
kilometres south-west of Lubumbashi, is considered to be a world-class
deposit, with a measured and indicated resource of 16.9 million tonnes with
an average grade of 16.7% zinc and 2.2 % copper. This resource is open ended
both along strike and down dip. The mine operated profitably from 1925 until
1993 when it was placed on care and maintenance for reason of insufficient
foreign exchange to maintain operations. Since this time the underground
facilities have been well maintained by G camines.
The agreement formalises the option agreement between AMZ and Zincor
concluded in August 2000, which granted Zincor the right to earn an interest
of up to 50% by the subscription of up to $3.50 million to be expended upon
a bankable feasibility study and any balance as an equity contribution to
the capital cost of the mine's redevelopment. Zincor exercised this option
in December 2000.
The new joint venture agreement now formalises the relationship between AMZ
and Zincor and lays the foundation for a new company to manage the future
operations of the mine. The
next step in the process is to complete negotiations with G camines, the
Congolese state-owned mining company, which holds the rights to the mine.
Once the necessary agreements are finalised with G camines and an
appropriate fiscal regime determined with the Government of the DRC, a
feasibility study for an initially small-scale project would be conducted.
It is envisaged that the project will be developed in stages.
The agreement between the joint venture partners and G camines will see the
new company managing all mining operations at Kipushi and, in return for
investment in equipment, sharing in the cash flows generated from the
project.
Ernst Venter, general manager of Kumba's base metals strategic business
unit, commented that there were important long-term advantages for Zincor
stemming from its participation in the project. Kumba, which listed on the
JSE Securities Exchange SA during November of last year, is focused towards
growth in, and upliftment of the Southern African region. Its involvement in
both the Kipushi and Kamoto projects in the DRC cemented its presence in the
region.
Tim Read, President and Chief Executive Officer of AMZ, commented that the
establishment of the Kipushi joint venture represents a major step forward
in the re-development of the mine.
ends
Contacts: Ernst Venter
General Manager, Kumba Base Metals
Tel: +27 (12) 307 4906
Telephone : + 27 (12) 307 4561 P.O. Box 9229
Telefax : + 27 (12) 307 4080 PRETORIA 0001
Doug Taylor
General Manager, New Business and Commodity Management
Tel: +27 (12) 674 1223
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