Increased mining rate for Kalumines and Konkola North technical study completed

    TORONTO, Aug. 31 /CNW/ -

    -   Rapid build-up of copper mining at Kalumines in the DRC
    -   TEAL Metals furnace installed in the DRC and being commissioned
    -   Technical aspects of a feasibility study for the Konkola North Copper
        Project in Zambia completed
    -   Otjikoto's Inferred gold resource in Namibia nears the two million
        ounce target
    -   Options for the Mwambashi Copper Project in Zambia being  reviewed
    -   Major shareholder agrees to guarantee an increase and extension of
        existing bridge loan facility

    In releasing results for the three and twelve months ended June 30, 2007,
TEAL Exploration & Mining Incorporated (TSX-"TL") (JSE-"TEL") ("TEAL" or the
"Company") has announced an increased mining rate at its mine being
commissioned in the Democratic Republic of Congo ("DRC"). Furthermore, the
technical aspects of the feasibility study for the Konkola North Copper
Project in Zambia have been completed indicating a mine capable of producing
25,000 tonnes a year of contained copper.
    It was announced on May 15, 2007 that mining at the Lupoto prospect,
which forms part of TEAL's Kasonta-Lupoto Mines ("Kalumines") Copper-Cobalt
Project, had started. At the time of the announcement, the Company was
anticipating a mining operation at a rate of 70,000m(3) per month, which would
produce over 20,000 tonnes per year of concentrate. These targets have
subsequently been revised and monthly planned production is now building-up to
110,000m(3), producing 40,000 tonnes of mineralized material per month. From
this, 3,200 tonnes per month of concentrate will be produced grading between
20% and 25% copper, containing approximately 10,000 tonnes of copper per year.
    TEAL Metals (DRC) s.p.r.l. ("TEAL Metals") will purchase all the
concentrates from Kalumines and feed its furnace at a rate of 1,800 tonnes per
month. This furnace, which is in the process of commissioning, has a capacity
to produce approximately 5,000 tonnes per year of 'black copper' ingots with a
grading of 85% to 95% copper.
    The surplus concentrates, some 1,400 tonnes per month, will be sold to
various other smelter operators in the DRC, in particular, to Société Miniere
du Katanga s.p.r.l. ("Somika") with whom TEAL Metals has formed a joint
venture to process the material at Somika's facilities until December 2007.
TEAL Metals will contribute the concentrate, while Somika will contribute all
costs of operation, and profits will be shared on an equal basis.
    A feasibility study on a larger open pit mining operation at Lupoto,
together with a dedicated processing facility, is in progress and is scheduled
for completion after the verification and in-fill resource drilling, as well
as the metallurgical test-work, has been concluded.
    The first results from the exploration drilling program at Lupoto were
announced on July 11, 2007. TEAL is conducting a 5,200 metre exploration
drilling program on the property to verify and update the historical resource.
TEAL has drilled nearly 4,200 metres to date on the Lupoto area comprising 31
reverse circulation and 23 diamond core boreholes. Borehole R-001 has
confirmed the historical interpretation of the upper zones of mineralization
as 2.7 metres grading 11.20% copper, and 13 metres at 6.44% copper on the
eastern limb of the main Lupoto structure. Additional drilling information is
being geologically logged and interpreted. TEAL believes the mineralization is
open ended at depth and on strike, and current drilling is targeting the
shallow (above approximately 100 metres depth) and predominately oxide copper
    The technical aspects of the Konkola North Copper Project feasibility
study, based on an operation to exploit the South and East Limb areas of the
orebody, have been completed. The study has confirmed the practicality of
utilizing the existing shaft to gain rapid access to the orebody and mining
first in the South Limb area, followed by the East Limb. The Konkola North
mine is forecast to produce 1,250,000 tonnes per year of run-of-mine ore,
predominantly using the sub-level open stoping as well as room-and-pillar
mining methods, for an expected build-up to an average production over the
16-year life of mine of 25,000 tonnes of contained copper per year. The life
of mine production contained in the study is forecast at 17.9 million tonnes
of ore grading 2.16% copper. It remains the intention to assess the viability
of a dedicated processing facility for Konkola North and this will be analyzed
as a separate project following the completion and approval of the current
study, which is expected following the conclusion of the remaining aspects to
take this study to a bankable level.
    The Board of Directors has approved expenditure of US$1.5 million for the
Konkola North Copper Project. These funds will be used to secure long lead
items, such as the electrification for the mine winder system, upgrading of
the mine power supply to the mine, and the detailed design of the steelwork
sections in the shaft that requires replacement. The mining contractor will
also be appointed and underground rehabilitation work will continue, which
will allow mining to commence as soon as the mine winders have been installed.
    TEAL is conducting a pre-feasibility study on the Otjikoto Gold Project
and completion of this study is anticipated in early 2008. Following a
positive conclusion, this will lead to the immediate initiation of a bankable
feasibility study with the goal of fast tracking the Otjikoto Gold Project to
a possible mine development decision.
    TEAL recently completed an interim phase of geological modelling and
geostatistical evaluation from its ongoing phase of drilling of the Otjikoto
deposit. The current total combined Inferred resource estimate has increased
by 35% to 44 million tonnes at 1.246g/t, providing 1.76 million ounces of
gold. Results from boreholes TC23, TC40 and OT152 have confirmed, and
extended, high grade zones of mineralization. TC23 returned 18.90m grading
3.05 g/t gold, TC40 16.20m grading 9.54 g/t gold and OT152 returned 13.50m at
6.46 g/t gold. This represents an increase of 460,000 ounces from the previous
1.3 million ounces, which was audited and supported by SRK Consulting in
February, 2007. The additional ounces have resulted from the intersection of
extensions to the mineralization to the eastern and southern areas of the
    Internationally accredited laboratories are used to analyze samples from
the Otjikoto Gold Project:

    -   Core samples from the resource expansion and infill drilling: SGS
        Lakefield Research Africa (Johannesburg, South Africa) and Genalyses
        Laboratory Services (Pty) Ltd (Perth, Australia);
    -   Otjikoto exploration and Greater Otjikoto Exploration Area core
        samples: ALS Chemex (Johannesburg, South Africa); and
    -   Soil samples are processed by Genalyses Laboratory Services (Pty) Ltd
        (Perth, Australia).

    The feasibility study for the Mwambashi Copper Project was largely
completed in August 2006, and development has remained subject to an off-take
arrangement for the treatment of the Mwambashi copper ore, which is primarily
oxide-based in the early years of the mine life. Although the process to
conclude an off-take agreement advanced over the last year, management has not
secured suitable terms to the benefit of the Company. TEAL is now assessing
various alternatives.
    As at end June 30, 2007, TEAL's cash resources amounted to
US$5.9 million, and the Company also had access to an additional US$10 million
remaining from a one-year US$20 million bridge loan facility entered into
during the financial year under review, which is being guaranteed by TEAL's
major shareholder, African Rainbow Minerals Limited ("ARM"). Subsequent to
year-end, ARM has agreed to increase the guarantee to $50 million, subject to
South African Reserve Bank approval, which will ensure that TEAL has a
facility in place beyond the end of the 2008 financial year or until long-term
funding is arranged. TEAL is currently negotiating the terms, including an
extension beyond the one-year time-frame, with Standard Chartered Bank. These
funds will be directed towards work to support studies on the core projects:
the Konkola North and Kalumines copper projects, as well as the Otjikoto Gold
Project. Funding for the capital expenditure at Konkola North, Kalumines and
Otjikoto will be pursued after the completion of the final feasibility
    The Company recorded a consolidated net loss for the three months ended
June 30, 2007 of $8.6 million, or $0.16 cents per share, which compares to a
net loss for March 31, 2007 of $9.6 million, or $0.18 loss per share. Over the
twelve month period, TEAL reported a net loss of $27.3 million or $0.51 cents
per share. This compares to a net loss of $9.0 million, or $0.27 cents per
share, for the twelve months ended June 30, 2006. This year-on-year increase
is indicative of the accelerated expenditure that occurred over the last year
on exploration drilling programs, project development and the commencement of
mining in the DRC.
    TEAL's Chief Financial Officer, Mr. Hannes Otto Meyer (37), the Company's
Chief Operating Officer, Mr. Arné Nicolaas Lewis (38), as well as ARM's
Executive: Business Development, Africa, Mr. Daniel Simelane (45), have been
appointed to the Board.
    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 for purposes 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 Namibia, Zambia and the Democratic Republic
of Congo ("DRC"). 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 activities.
    A copy of TEAL's Annual Financial Statements and the MD&A are available
at as well as at

For further information:

For further information: Julian Gwillim (VP: Investor Relations and
Corporate Development) on (416) 828-1422 (Canada), or +27 82 4524 389 (SA), or; or Rick Menell (President and CEO) on +27 82 450 2301,

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