8th Dec 2008 14:18
8 December 2008
For immediate release
African Minerals Limited
("AML" or the "Company")
Strategic Option Agreement
African Minerals Limited (AIM: AMI), the mineral exploration company with significant interests in Sierra Leone, West Africa, is pleased to announce that it has entered into an Option Agreement ("Agreement") with Pinnacle Group Assets (SL) Limited ("Pinnacle"), a privately-held company registered in Sierra Leone. Pinnacle holds the rights to certain coal and other mineral exploration licences in Sierra Leone.
Under the Agreement AML has, in return for the payment of US$1.25M to Pinnacle, acquired the exclusive option during a period of 24 months from the date of signature of the Agreement (the "Option Period"), to explore for coal and other minerals within the areas over which Pinnacle has mineral licences in Sierra Leone and other countries in West Africa.
The area included in this Agreement is over a 150km strike length north and south of the Pepel deep water port.
Historic work conducted during the 1950's indicated that substantial potential exists for coal resources within these areas. This was confirmed by substantial drill testing during 1975.
The Company's strategy, in addition to its focus on its iron ore and infrastructure projects, is to develop coal resources for the following:
Power generation for the Company's iron ore and other projects in Sierra Leone and for distribution generally to the national grid of Sierra Leone Conversion of iron ore fines to pelletsIncluded within the Agreement are the following mineral licences:
Exploration License EXPL 04/08, to explore for coal in an area of 929.53 sq km in the Western Area, Koya Ribbi and Bumpeh Chiefdoms.
Exploration License EXPL 05/08, to explore for coal in an area of 1,119.4sq km in the Samu, Magbema, Mambolo Loko Masama, Kaffu Bullom and Mafroki Chiefdoms.
Exploration License EXPL 06/08, to explore for coal in an area of 1,200.73sq km in the Rabbi, Bumpeh, Kagobora, Bagruwa and Timdel Chiefdoms.
AML also has the right during the Option Period to purchase the full interests held by Pinnacle for a price to be agreed between the parties or, failing agreement, at a price set by an independent valuer. The price would be payable either in cash or shares in AML, at AML's option.
The Agreement also contains a requirement for AML to spend an additional US$2M during the Option Period in exploration of the areas held under licence by Pinnacle.
Frank Timis, Executive Chairman of the Company commented:
"We are delighted to have signed the exclusive option agreement with Pinnacle, which allows the Company to evaluate the magnitude and quality of the coal deposits close to our infrastructure project at Pepel port. These coal deposits will be an important element of the integration of our infrastructure project with our iron ore projects at Marampa and Tonkolili, particularly in providing the source of power for the future production of iron ore at both of those projects."
Enquiries:
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African Minerals Limited |
Tel: +44 (0) 20 7849 3002 |
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Frank Timis |
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Canaccord Adams Limited |
Tel: +44 (0) 20 7050 6500 |
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Mike Jones |
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Mirabaud Securities Limited |
Tel: +44 (0) 20 7878 3360 |
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Rory Scott |
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Citigate Dewe Rogerson |
Tel: +44 (0) 20 7638 9571 |
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Martin Jackson |
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George Cazenove |
Related Shares:
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