TORONTO, Aug. 29 /CNW/ -
- Konkola North's South and East Limb feasibility study being revised to
include the new resource, as well as recently promulgated mining tax
legislation, and to update capital and operating costs
- Environmental approval obtained
- Seven boreholes of a 18,000 metre exploration drilling program on
Konkola North's Area 'A' completed, selected results include:
- 9.74m at 3.87% copper
- 9.75m at 5.62% copper
- 5.03m at 4.25% copper
- 11.71m at 4.17% copper
- First phase copper resource increased by 125% for the Lupoto Copper
Project in the DRC
- The Otjikoto Gold Project's indicated gold resource increased to
1.05 million ounces at a grade of 1.40g/t; with an additional
877,000 ounces contained in the inferred category at a grade of
- TEAL's holding company provides letter of financial support
In releasing its results for the twelve month period ended June 30, 2008,
TEAL Exploration & Mining Incorporated (TSX-"TL") (JSE-"TEL") ("TEAL" or the
"Company") has announced that the Konkola North Copper Project feasibility
study for the South and East Limb is being revised to include the recently
upgraded resource base.
The updated study will also include a review of capital and operating
costs, as well as the recently promulgated mining tax legislation in Zambia.
The measured and indicated resource for the South and East Limb area now
totals 51 million tonnes at a grade of 2.35% copper, and it is this resource
that will now be used for mine planning and scheduling. The South and East
Limb area also has an inferred resource of 26.9 million tonnes at 2.46%
copper. The finalization of the revised feasibility study is expected before
the end of November 2008.
The previous measured and indicated resource totalled 24.9 million tonnes
at 2.36% copper, and the inferred resource was 47.6 million tonnes at 1.98%
Existing infrastructure at the Konkola North South Limb 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.
The Konkola North Copper Project feasibility study is based on an
operation to exploit the South and East Limb, utilizing the previously
developed infrastructure that will be re-equipped. TEAL has purchased a Koepe
'men and material' winder, a rock winder and a SAG mill. TEAL has undertaken
extensive metallurgical test work and the feasibility study includes the
construction of a metallurgical plant to produce two million tonnes of copper
concentrate for the life of mine resulting in a steady state refined copper
metal production of, potentially, 25,000 tonnes per year.
A final Environmental Impact Study has been approved for the project.
TEAL has also concluded a letter of commitment with the Copperbelt Energy
Corporation for the supply of electricity. Discussions are continuing with the
Zambian authorities regarding the recently legislated fiscal regime.
At Konkola North's Area 'A', TEAL has published a revised resource
estimation, which defined a total inferred resource of 219,500 million tonnes
at 2.64% total copper. TEAL is further evaluating this resource with an 18,000
metre exploration drilling program. Drilling commenced in September 2007 and
to date an additional seven boreholes have been completed for 11,400 metres.
The assay results of drill holes are available at www.tealmining.com.
TEAL has appointed Sphynx Consulting as an independent consultant to
conduct the database verification, geological modelling, ore body modelling
and resource estimation work for the Konkola North Copper Project, and SRK
Consulting (South Africa) has been appointed as the Qualified Person to
complete the Independent Qualified Persons Report. The analytical results are
certified by ALS Chemex in Johannesburg, South Africa, an internationally
Kalumines, which is a 60:40 joint venture with La Générale des Carrières
et des Mines ("Gécamines"), is situated in the Democratic Republic of the
Congo ("DRC") and hosts various near surface areas of copper mineralization.
TEAL has focused its resource definition, feasibility study work and initial
mine production on one of these mineralized areas, namely the Lupoto Copper
TEAL has an existing mining licence over the Kalumines property. It was
announced on May 15, 2007 that small-scale mining at Lupoto had started. Total
copper concentrates produced for the quarter ended June 30, 2008 were 23,413
tonnes. This compares to 11,978 tonnes of concentrate for the quarter ended
March 31, 2008. For the financial year ending June 30, 2008, 46,404 tonnes of
copper concentrates were produced, the majority of which were sold.
The lower grade material has been stockpiled for future use in a planned
processing plant, which forms part of a pre-feasibility study that is underway
for a larger mine that will produce approximately 40,000 tonnes a year of LME
'A' grade copper cathodes. This stockpile now contains approximately 800,000
tonnes of material, including a high grade portion of 455,955 tonnes, grading
between 4% and 6% copper. TEAL management continually assesses the mining rate
at this operation.
In February 2008, TEAL received written notification from the Minister of
Mines in the DRC informing the Company of the outcome of the DRC's Mining
Contracts Review Commission with respect to the Kalumines property. TEAL
responded to the Government in writing and the Company has now received
further correspondence proposing a meeting to discuss amendments to the joint
venture agreement with Gécamines. This meeting is in the process of being
Excluding the material mined by the phase 1 mining operation and the
stockpile mentioned above, the first phase resource estimation for the Lupoto
Copper Project, at a 0.5% copper cut-off and to an average of 80 metres of
vertical depth, is as follows:
- Indicated Resources: 15.09 mt @ 2.32% TCu, 1.83% ASCu, 0.15% Co;
- Inferred Resources: 9.13 mt @ 2.09% TCu, 1.73% ASCu.
It has also been previously announced that a furnace, operated by TEAL's
wholly-owned subsidiary, TEAL Metals (DRC) s.p.r.l. and located in Lubumbashi
in the DRC, is deemed non-core and discussions are currently underway with
potentially interested parties to acquire this business.
During July 2008, TEAL announced an increase in the Otjikoto Gold
Project's indicated gold resource from 460,000 ounces to 1.05 million ounces
of gold, equating to 23.3 million tonnes grading 1.40g/t, with an additional
877,000 ounces contained in the inferred category at a grade of 1.41g/t. This
128% increase in the indicated gold resource category represents an interim
phase of geological modelling and resource estimation, until all assay results
have been received. Additional drilling is ongoing to further evaluate the
higher-grade gold zones, and to further delineate these zones previously
intersected within the south-western area of the Otjikoto area.
On July 15, 2008, TEAL announced that a consortium of two lenders,
Standard Chartered Bank and Standard Finance (Isle of Man) Limited, part of
the Standard Bank Group, made available a bridging loan facility that totals
$85 million. This unsecured $85 million facility replaces the previous
$50 million loan facility: this new facility will be used to settle the
existing $50 million loan, and accrued interest. The facility is available to
August 31, 2009 and is guaranteed by African Rainbow Minerals Limited ("ARM"),
TEAL's holding company.
The Company generated revenues for the year ended June 30, 2008 of
$17.8 million, which are derived from the mining operations at the Lupoto
Copper Project in the DRC, and which resulted in a contribution from sales of
$11.2 million. After other expenses, principally exploration and development
costs of $29.1 million, which are partially offset by a profit of $9.5 million
on the sale of interests in the Otjikoto Gold Project and certain exploration
areas in Zambia, the loss from continued operations amounted to $15.2 million
(June 30, 2007: $27.9 million - loss), or $0.28 loss per share ($0.50 - loss
per share). After a loss of $10.1 million in respect of the discontinued
furnace operation in the DRC, the Company's net loss amounted to
$25.3 million, or $0.47 loss per share.
In compliance with accounting standards, the furnace is being treated as
a discontinued operation, which has resulted in accounting adjustments for the
quarter ended June 30, 2008. Total revenue for the quarter amounted to an
adjusted $8.6 million (March 31, 2008: $5.5 million) and a contribution from
sales of $5.3 million ($2.9 million) was recorded. After deducting other
expenses, principally exploration and development costs of $11.6 million,
partially offset by adjustments to corporate and administration costs
resulting in a credit of $4.9 million, and a profit of $5.5 million on the
sale of certain exploration areas in Zambia, the net profit after taxation for
the quarter amounted to $4.6 million ($6.0 million - loss) or $0.08 per share
($0.11 - loss per share). After the loss of $8.1 million in respect of the
discontinued furnace operation in the DRC, the net loss after taxation for the
quarter amounted to $3.7 million ($6.5 million - loss), or $0.07 loss per
share ($0.12 - loss per share).
With the accumulated deficiency, commitments and planned exploration and
development program, the Company remains dependent on ARM. A letter of
financial support has been made available by ARM, which provides the Company
with a support amounting to ZAR385 million, equivalent to approximately $50
million at current exchange rates, which may be utilized after the bridging
loan has been fully drawn and at any time thereafter up to September 30, 2009.
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 in terms of National Instrument 43-101.
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
ADDITIONAL TEAL INFORMATION CAN BE FOUND AT: www.tealmining.com
For further information:
For further information: Julian Gwillim (VP: Investor Relations and
Corporate Development) on +27 82 4524 389 (SA); or firstname.lastname@example.org