VANCOUVER, May 20, 2014 /CNW/ - El Niño Ventures Inc. ("ELN") (TSX.V: ELN) (OTCQX: ELNOF) (Frankfurt: E7Q) is pleased to announce that it has entered into an Option Agreement (the "Agreement") with MMG Limited ("MMG"), whereby MMG can acquire ELN`s 70% interest in the Kasala copper project in the Democratic Republic of the Congo (DRC) for a total consideration of USD$6,000,000.00.
As consideration for the exclusive right to acquire El Nino`s 70% interest in Infinity Resources Sprl, the joint venture company that owns the Kasala permits, MMG has agreed to pay a non-refundable USD$350,000. Under the terms of the Agreement, once certain conditions have been satisfied (the "Satisfaction Date"), in order to maintain the option, MMG:
|1.||Is required to make staged payments of up to a total USD$3,000,000 consisting of an initial payment of $250,000 on the Satisfaction Date and three annual payments of $916,666; and|
|2.||Must incur a total of USD$15,000,000 in exploration expenditures over the three option year period.|
If MMG exercises the option, the consideration payable by MMG to ELN is;
|3.||USD$6,000,000 less the amounts set out above to maintain the Option (up to a total USD$3,000,000); plus|
Harry Barr, Chairman and CEO, stated "We are very pleased to have concluded an agreement with MMG Limited that will return immediate and long term value to our shareholders. Management has fought long and hard to secure all of the assets of its Joint Venture Company, Infinity Resources Sprl, and in particular the Kasala Permits. The recent overwhelming success in winning our claims against GCP Group in the International Arbitration hearing has provided management with the opportunity to negotiate this Agreement with MMG. We would like to thank all of our shareholders for their patience and support over this very difficult period. With a commitment to an extensive exploration program, your company will finally have the opportunity to fully realize the potential for the Kasala project"
About MMG Limited:
MMG Limited, headquartered in Melbourne, Australia, is a global resources company which explores, develops and mines base metal deposits around the world (for more information please visit MMG's website). MMG is one of the world`s largest producers of zinc, copper, lead, gold and silver. MMG's major shareholder is China Minmetals Nonferrous Metals Co. Ltd. (CMN), a subsidiary of China Minmetals Corporation (CMC). CMC is one of China's major multinational state-owned enterprises. It is a diversified company with businesses in metals trading, ferrous and non-ferrous metals production, finance, real estate and logistics.
In Africa, MMG Limited owns and operates the Kinsevere high-grade copper mine located in the Katanga Province of the Democratic Republic of Congo (DRC). The Kinsevere Mine is approximately 30 km from ELN`s Kasala project with both located in a region renowned for copper and cobalt deposits of exceptional quality. With the completion of the Stage 2 project in 2011 - a $400 million solvent-extraction and electro-winning (SX-EW) plant - the Kinsevere Mine has a nameplate capacity of 60,000 tonnes of copper cathode per year. In the first quarter 2014 Kinsevere achieved a quarterly production record, producing 16,848 tonnes of copper cathode. The Kinsevere Mine also achieved quarterly records in processing and sales in the first quarter of 2014.
About the Kasala Project
One of the newest copper discoveries in the Central African Copper Belt, El Niño Ventures' Kasala prospect is located approximately 70 kilometres northwest of Lubumbashi, Democratic Republic of Congo's second largest city and the center of the country's massive copper/cobalt mining industry. The Central African Copper Belt contains over 10% of the world's copper and 34% of the world's cobalt. The Kasala project permits are located close to the Kinsevere Mine, which is expected to produce 60,000 tonnes of copper annually for the next 13 years.
The Kasala Block A was the subject of the Company's 2008 drill campaign. 35 Reverse Circulation (R.C.) drill holes totaling 3,336 metres and 15 diamond drill holes totaling 2,584 metres were completed on the Kasala Block (A) leading to the discovery of substantial copper mineralization.
Significant Assay results for Kasala Block (A) are:
- Hole MDB023: 80m @ 1.42% Cu from 17m downhole; includes 29m @ 2.82% Cu and 5m @ 4.11% Cu
- Hole MDB027: 91m @ 1.16% Cu from 9m downhole; includes 22m @ 3.28% Cu and 5m @ 4.39% Cu
- Hole MDBDD0011b: 91m @ 1.19% Cu from 54m downhole; includes 10m @ 6.7% Cu
- Hole MDBDD0019: 22m @ 3.28% Cu from 125m downhole; includes 7m @ 7.02% Cu (sulphide)
The Kasala project has an excellent infrastructure and is ideally situated within 20 km of the national highway (a hard-surfaced all-weather road) and is also within 30 km of a rail line linking the mining centers of the Copper Belt. A high-tension electrical transmission line is located 12 km west of the projects' boundaries. The assay results from the earlier drill programs confirm the presence of significant mineralization within the Kasala Main Zone with the potential for significant expansion of the mineralized zone, based on the results from an IP Survey completed in early 2009 which identified copper oxide mineralization at and near surface; sulphide mineralization at depth.
Kasala Prospect mineralization zone is open to expansion by drilling to the north, south and west, and to depth. As drilled, the Kasala Prospect oxide zone measures about 600m long x 400m wide x 30m thick. It is very important to note that many 2008 drill holes ended in copper oxide mineralization and to note that adjacent blocks are under‐explored (Figure 1).
A 4,071 soil geochemical sampling program was undertaken to test numerous targets south and east of the Kasala Blocks A, B and C and expand upon the area of soil geochemistry coverage on the exploration permit. Sampling had commenced in December 2009 and was completed in late January 2010; chemical analysis of the soil samples was completed by late February 2010. The sampling utilized Quality Alliance and Quality Control protocols established during previous soil geochemical sampling programs on the project.
Figure 1. Plan view of drill collar locations in Kasala prospect area (adapted from 2008 drill report by Allan Lines). The main mineralized zone projected to surface is shaded red. Collar locations labelled MDB are reverse circulation holes. Collar locations labelled MDBDD are diamond drill holes. Note that the mineralized zone is open to expansion by drilling to the north, south and west.
Figure 2. High grade oxide drill core Kasala Project & Sulfide drill core at depth on Kasala
The sampling program identified three new copper-in-soil anomalies (Figure 3) which warrant additional investigation. The presence of a narrow (150 to 200 metres in width) anomalous zone exceeding 1,200 metres in length was identified approximately 2 kilometres southeast of Kasala Block A. This copper-in-soil anomaly corresponds to a Total Count radiometric anomaly (identified during the Company's 2007 airborne geophysical program), which is believed to result from potassic alteration of rocks of the Roan Supergroup in contact with rocks of the Kundelungu Supergroup.
A second anomaly in the northeast of the survey area is of a lower order of copper mineralization but, notably, shows a high degree of correlation with the western terminus of a strong Total Count radiometric anomaly which exceeds 3 kilometres in length (Block B). The third new copper-in-soil anomaly is being referred to as the Kasala Western Extension (Block C). It is immediately west and south of Kasala Block A. Kasala Western Extension is a high order copper anomaly with a known length of approximately 550 metres. It is felt that these additional radiometric anomalies may represent important targets for additional exploration programs.
Figure 3. Map showing copper-in-soil values for El Niño Ventures Inc's soil geochemical sampling program. This program has identified three new copper-in-soil anomalies which are considered significant targets for further evaluation.
About other ELN's Research Permits in the DRC:
El Nino currently holds a 70 % interest in four well located Research Permits, accessible by road from the town of Lubumbashi in southern Congo. Each Permit is partially underlain by the highly prospective Roan Formation which hosts most of the important copper deposits in this area. The accompanying map shows the general location of the licences, as well as the location of the known principal targets delineated on permit 5217 and the focus of the drilling to date. Between 2007 and 2011, EL Nino Venture Inc., as operators of the project carried out several phases of exploration on these permits. Details of the exploration programs are demonstrated in table below;
Exploration Programs from 2007 to 2010
|Year/Date||PR5214 (Kasala)||PR5215 (Copper Mountain)||PR5216||PR5217 (Copper Mountain)|
|2007-July||Remote Sensing||Remote Sensing||Remote Sensing||Remote Sensing|
|2007 Sep-Oct|| Airborne Gamma
| Airborne Gamma
| Airborne Gamma
| Airborne Gamma Ray
Spectrometer & magnetic
|2007 Oct-Nov|| 80 holes 6266 metres RC
|2007-2008 Dec- June||2235 Soil Samples||1244 Soil Samples||4777 Soil Samples|
|2008 Jan- May||2068 Soil Samples|
|2008 June-July|| 32 holes 1995
metres RC Drilling
|3215 metres RC Drilling|
|2008 July to September|| 56 holes 5883
metres RC Drilling
20 Holes 3583.6
|2008 September|| Pole-Dipole IP
|2009-2010 Dec - Jan||4071 Soil Samples|
In 2007 ELN completed 6266 metres of RC drilling across 80 holes. One of the highlights of the 2007 drilling program was the intersection of > %3 copper over 10 metres (see below).
Three RC holes drilled on Location Anomaly 3 returned the following intercepts:
- Hole ANCU001: 10m @ 3.51% Cu from 12m below surface (including 4m @ 7.24% Cu from 15m)
- Hole ANCU003: 10m @ 0.25% Cu from 20m below surface
- Hole ANCU004: 5m @ 1.88% Cu from 20m below surface
Figure 4. Location of Permits in relation to Lubumbashi (PR 5214 is Kasala)
Figure 5. 2007 and 2008 Drill hole location map Kasala and PR-5217 Projects
El Nino would like to acknowledge our joint venture partner, Mr. Hassan Sabra, who has worked continually within the framework of the Joint Venture to advance the Kasala project and tirelessly with El Nino to secure the assets of Infinity Resources Sprl.
About El Niño Ventures Inc. Bathurst Projects, New Brunswick, Canada
ELN has two active projects in the Bathurst Mining Camp: Murray Brook and the Bathurst Option Joint Venture. A recent consolidation resulted in the Company having 30.6 million shares Issued & Outstanding with a current market capitalization of approx. $2.0 million.
Murray Brook Project
The Murray Brook Project is located 60 km west of Bathurst, in the northwest part of the Bathurst Mining Camp (Figure 6). The Murray Brook deposit is a zinc-lead-copper-silver massive sulphide which is the subject of a recently completed Preliminary Economic Assessment. The project is supported by excellent infrastructure including paved roads, grid electricity and communities to provide goods, services and skilled labour. ELN and Votorantim Metals Canada (VMC) currently own 100% of the Murray Brook Project with VMC acting as the operator. VMC controls 65% and ELN controls 35%.
Figure 6 - Murray Brook Project and Camel Back property location map, Bathurst Mining Camp, New Brunswick
To date, more than 28,000 metres of drilling has been completed on the Murray Brook Project. The first NI43-101 mineral resource estimation and the first metallurgical results were published in press releases dated February 2012 and January 2013, respectively. On June 5, 2013 a positive Preliminary Economic Assessment was announced (see news release). The results of the PEA demonstrate the potential technical and economic viability of establishing a new mine and mill complex on the Murray Brook property. The projected cash flows indicate an after-tax NPV at a 5% discount rate of $96.4 million, an IRR of 11.4%, and a payback period of 5.4 years (see news release). The NI43-101 Technical Report is filed on SEDAR and also available on the ELN website (http://www.elninoventures.com).
Qualified Persons Statement
This news release has been reviewed and approved for technical contents of the BOJV and Murray Brook projects by William Stone, Ph.D., P.Geo. and a Qualified Person under the provisions of National Instrument 43-101. The information in this Press Release that relates to Exploration Results for the Kasala Project is based on information compiled and reviewed by Ali Hassanalizadeh Msc., P.Geo. and a Qualified Person under the provisions of National Instrument 43-101. Mr. Hassanalizadeh has relied on Mr. Benoit M. Violette, P. Geo., consulting geologist and the Qualified Person under NI‐43‐101.
On Behalf of the Board of Directors,
Chairman & CEO
El Niño Ventures Inc.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward Looking Statements. This release contains forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results and are based on current expectations or beliefs. For this purpose, statements of historical fact may be deemed to be forward-looking statements. In addition, forward-looking statements include statements in which the Company uses words such as "continue", "efforts", "expect", "believe", "anticipate", "confident", "intend", "strategy", "plan", "will", "estimate", "project", "goal", "target", "prospects", "optimistic" or similar expressions. These statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others, the Company's ability and continuation of efforts to timely and completely make available adequate current public information, additional or different regulatory and legal requirements and restrictions that may be imposed, and other factors as may be discussed in the documents filed by the Company on SEDAR (www.sedar.com), including the most recent reports that identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. The Company does not undertake any obligation to review or confirm analysts' expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Investors should not place undue reliance on forward-looking statements.
SOURCE: El Nino Ventures Inc.
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