21st Apr 2008 15:01
Weatherly International PLC21 April 2008 Tambao Manganese Project Weatherly International plc, the resource company with copper mining andsmelting operations in Namibia, is pleased to announce that an interim reportprepared by WorleyParsons confirms the viability of its Tambao manganese projectin Burkina Faso. Highlights • Predicted, proven and probable reserves of approximately 19 million tonnes with a manganese content of 50%. (Interstar Mining Group Inc, 1992). • Phased production: 0.35 million tonnes per annum for the first two years, 0.55 million tonnes per annum in years three and four, achieving full rate of one million tonnes per annum by year five. • Mine life of greater than 20 years based on existing reserves. • Total annual operating costs (FOB Abidjan) of approximately US$32 million in the first four years, increasing to approximately US$48 million when full production rate is achieved. • Initial capital costs of US$124m to commence production, with a further capital expenditure including the rail extension to the mine-site of approximately US$221 million spread over five years. The full Bankable Feasibility Study (BFS) is due for completion by September2008. The Tambao manganese project is located approximately 340 kilometres north eastof the capital Ouagadougou in the Tambao region of Burkina Faso. Discovered in1960 and drilled extensively by a Japanese consortium in the 1970's, the deposithas been the subject of various feasibility studies, the most recent of whichwas carried out by the Canadian company Interstar Mining Group Inc in 1992. The report focuses on a three stage progressive development of the project.Mining would be by simple shallow open pit methods followed by crushing and dryscreening to produce a lump and fine product for sale and would be focused inthe first 10 years on the higher grade areas where manganese content exceeds 52%with no deleterious elements. The ore would be transported by truck to theexisting railhead at Kaya and from there by rail to the Port of Abidjan in theIvory Coast. Once the railway is extended to the project, the trucking componentcould be eliminated, and the ore loaded directly into rail wagons at themine-site. This strategy would enable the project to commence quickly, usingexisting transport links, in order to take full advantage of the current strongglobal demand for high quality manganese ore. Weatherly is developing the project in partnership with Wadi Al Rawda IndustrialInvestments ("Wadi"), a private Dubai based company, that holds an Accord withthe Government of Burkina Faso (GBF). Under the Accord, upon completion of aBFS, the GBF will grant Wadi a 90% interest in the project with the GBFretaining a 10% interest. Under an agreement with Wadi, Weatherly will hold an80% interest in the joint venture company which is to acquire the 90% share in the project and will manage the project to full development. Weatherly has completed, subject to shareholder approval, a US$12 millioncapital raising in the form of 9% secured convertible loan notes due 2010 withwarrants attached, a part of this fundraising has been allocated by the Companyto complete the Tambao feasibility study and start initial engineering. Theproceeds of the fundraising will be used to upgrade existing assets in Namibia,including the refurbishment of the diesel power generating sets and theconstruction of the oxygen plant required for the second stage of the smelterexpansion. Commenting on the Tambao Report, Rod Webster, CEO, said: "The confirmation of the viability of the Tambao manganese project is animportant step in Weatherly's strategy of becoming a major African base metalsproducer and has the ability to generate profitable growth for shareholders inthe future. The successful development of the project will help diversifyWeatherly's assets and make the company less subject to the fluctuations of thecopper market." "Our successful fundraising underlines the confidence investors feel in ourstrategy for growth and we look forward to using the capital raised to furtheradvance the Tambao project in addition to upgrading our existing assets withinNamibia." For further information contact: Rod Webster, Chief Executive Officer Weatherly International +44 (0)207 868 2232Paul Craven, Chief Financial Officer Jakob Kinde Libertas Capital +44 (0)207 569 9650Stephen Pickup Anthony Cardew Cardew Group +44 (0)207 930 0777Jamie MiltonMatthew Law This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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