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Aflease Board approves development of the Dominion uranium project Aflease Gold and Uranium Resources Limited (Formerly The Afrikander Lease Limited) (Incorporated in the Republic of South Africa) AFL (JSE) AFLUY (NASDAQ) (Registration number 1921/006955/06) ISIN: ZAE000061461 & Share Code: AFL (`Aflease`) Aflease Board approves development of the Dominion uranium project The Board of Aflease Gold and Uranium Resources approved the development and construction of the Dominion uranium mine near Klerksdorp. The first uranium is expected to be produced in the first quarter of 2007. The metallurgical facilities will encompass a uranium plant that is to be integrated into the company`s existing CIL gold plant at Bonanza. The Dominion Uranium asset was previously owned and operated by Anglo American. This brownfield project therefore has infrastructure in place and a substantial information database of both geological and metallurgical information. Core from over 250 boreholes is available and the geological structure is well understood as a result of previous mining and seismic surveys. Current process test work has confirmed the use of pressure leaching resulting in high recoveries. Aflease intends to commence production of uranium in the first quarter of 2007. From 2011, annual uranium production from the mine is expected to be at least 4 million pounds per year with at least 90,000 ounces of gold as by-product. Said Aflease CEO Neal Froneman: `With spot uranium at $29/lb, and projected to increase further, Aflease plans to fast-track the work to resume mining, and our Board has now given its full vote of confidence in this flagship project. The Dominion Project will be central to Aflease`s growth strategy, as it contains a significant uranium resource - at a time when concerns about future energy supplies are making uranium a much sought after commodity. This is a high margin project not dependent on weak Rand US Dollar exchange rates. We are also confident that there will be a strong market for uranium, and have already signed a marketing and distribution agreement with Nufcor International Limited (NIL) for our uranium production.` Two phases in the development of the larger uranium ore body The company`s current planning involves the development of the larger ore body in two phases. Phase 1 will predominantly focus on that portion of the ore body that is less than 500m deep. This first phase is expected to have a life of mine of ten years. Aflease will be drawing on mining experience from its neighbouring and recently commissioned Bonanza South mine. Ore body access will be based on declines resulting in rapid access as also used at the adjacent Bonanza South mine. During the second half of the first phase, the company will, subject to further planning and feasibility work, aim to sink shafts to access the deeper portion of the ore body. The deeper ore body will represent phase 2 of the project and is expected to add a further 20 - 25 years of life to the uranium project. The uranium plant will incorporate pressure leaching and solvent extraction techniques. Although there is a capital cost premium for the pressure leach technology, test work suggests that recoveries will be in excess of 90% and fully justify the additional capital cost. Froneman said that the initial capital is `low for a project of this nature due to the fact that significant infrastructure remains from previous mining operations`. Exploration program The board has also approved a five year exploration programme. The exploration programme will focus on converting current indicated and inferred resources into higher category resources and to further increase the quantum of the existing resource. Aflease`s initial focus is on delineating ore reserves for the first 3 years of mining at the Dominion Mine as the company prepares for production from early 2007. Aflease recently announced a uranium resource at its Dominion, Rietkuil and Bonanza South properties, comprising total inferred resources of 113.3 million pounds of contained U3O8, at an average grade of 0.064%, and total measured and indicated resources of 9.8 million pounds of contained U3O8, at an average grade of 0.066%. In addition the Bonanza South property has a measured and indicated resource of 723,000 pounds U3O8, at an average grade of 0.009% as a by product from gold production. The focus of this first declaration was on areas where there was sufficient information to comply with the South African Code for Reporting of Mineral Resources (`SAMREC`). The estimates were audited and reviewed by SRK Consulting, an independent firm of consulting engineers and geologists (`SRK`). Aflease is in the process of obtaining an independent technical report that will comply with National Instrument 43-101 of the Canadian Securities Administrators (`NI 43-101`). The report is substantially complete, and it is not expected that there will be material differences between the resource estimate calculated in accordance with SAMREC and the resource estimate calculated in accordance with NI 43-101. Bankable feasibility The board has approved the expenditure of US$2.16 million to complete a bankable feasibility study. The bankable study will be used by the company to progress the mine design and to facilitate the raising of debt finance. Completion of this document is expected by April 2006. Rare earths The Board of the company has also approved US$512,000 to complete a pre- feasibility study on the extraction of rare-earth elements contained in the Dominion uranium resource. The ordinary shares of Aflease are traded in South Africa on the JSE Securities Exchange under the symbol `AFL` and over the counter in the form of a Level III American Depositary Receipts (symbol AFLUY) Contact: Neal Froneman: +27 (0) 83 628 0226 Carol Smith: +27 (0) 11 482 3605 John Fraser 27 (0) 82 331 7330 Date: 05/07/2005 08:52:06 AM Produced by the JSE SENS Department
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