ASX Announcement 15 September 2006 “African Focused Resource Company” AIM RESOURCES LIMITED ABN 63 009 193 980 Level 5 Angel Place 123 Pitt Street Sydney NSW 2000 t 61 2 9222 9444 f 61 2 9222 9477 Website www.aimresources.com.au Email [email protected] AIM Resources Limited is listed on the ASX with the symbol “AIM” and on the LSE Alternative Investment Market with the symbol “AIMR” PERKOA ZINC OFF TAKE AGREEMENTS AIM Resources is pleased to announce that Letters of Intent have been signed with three parties for the off-take of zinc concentrates from the Perkoa Zinc Project. Perkoa’s high-grade, clean concentrates are eagerly sought after and will provide a very attractive feed for zinc smelters. Given the location of Perkoa in Burkina Faso, the following companies have been selected as off-take partners: • Xstrata Zinc for its smelters in Spain and Germany; • Votarantim Metais for its smelters in Brazil and Peru; and • Louis Dreyfus Commodities Metals Suisse SA with extensive commodities trading and logistics expertise, particularly in West Africa. These three off-take partners will provide Perkoa with a secure, long-term market, attractive sales terms and flexibility in concentrate sales. The geographic proximity of Perkoa to the chosen markets will provide commercial benefits to AIM Resources as well as these partners. The Letters of Intent set out the framework and the commercial terms which will be incorporated into off-take agreements between the Parties. AIM Resources is now well positioned to finalise detailed off-take agreements for the total forecast production of zinc concentrates from Perkoa. Two of the parties have indicated a willingness to assist with project funding in a form such as providing a cost over-run facility. AIM Resources has been assisted by Cashmere Marketing Consultants, a firm specialising in base metal concentrates. The current global shortage of zinc concentrates and the historically high zinc price provides favourable returns for zinc mines and smelters and augurs well for the future of the Perkoa Zinc Project. Marc Flory, Managing Director, said “Selecting our concentrate off-take partners is a key step forward towards finalising our funding arrangements for the development of Perkoa. “I am delighted to have these three quality companies as our off-take partners. Their complementary strengths should help ensure the best possible outcome for the marketing of Perkoa’s concentrates. “This news builds on our recent appointments of Byrnecut Mining as mining contractor and DRA Mineral Projects as EPC manager for Perkoa. “We are systematically working towards commencing development of the Perkoa Zinc Project in a manner which achieves the best outcomes for our shareholders and other stakeholders.” Further Information Contact Marc Flory or Wayne Kernaghan on +61 2 9222 9444. 2 About Perkoa Zinc Project The Perkoa Zinc Project is located in the Sanguie Province of Burkina Faso, 120km west of the capital Ouagadougou. The project is 35km by road from the country's third largest town, Koudougou, which is linked to neighbouring states of Cote D'Ivoire, Ghana and Togo by tarred roads and by rail to Abidjan, capital of Cote D'Ivoire Snowden Mining Consultants completed a Bankable Feasibility Study (“BFS”) on the Perkoa Zinc Project in December 2005. Perkoa has a JORC-compliant Ore Reserve of 6.3 million tonnes at a mine head grade of 14.5% zinc, equating to 907,679 tonnes of contained zinc metal. The BFS incorporates a mine design consisting of decline access to the ore body, ramping up to deliver 0.5 million tonnes per annum of ore. A simple processing facility comprises a crushing circuit followed by dense media separation, milling and flotation, resulting in the production of 130,000 dry tonnes per annum of relatively clean concentrate, grading 53% zinc over a 14 year mine life. Plant infrastructure in the study includes a tailings dam facility incorporating a return/storm water dam for capture and re-use in the processing plant. The main source of process water will be from a dam that has recently been constructed by the Burkina Faso Government, close to the Perkoa Zinc Project. Power will be provided by on-site diesel generators. The BFS addressed the project’s transportation requirements by recommending two of the alternatives available. The first route uses the rail line situated 30km from the Perkoa Zinc Project and passing through the neighbouring country of Cote D’Ivoire to the Port of Abidjan. The second route uses road transport alternatives passing through Ghana to the Port of Tema. About Xstrata Zinc Xstrata Zinc is a subsidiary of Xstrata Plc. Xstrata Zinc would process Perkoa concentrates through either the San Juan de Nieva zinc smelter in Spain or the Nordenham zinc smelter Germany. The San Juan de Nieva plant is the largest single zinc smelter in the world, with a capacity of 492,000 tonnes per year zinc. Its production consists mainly of zinc ingots, galvanizing products and die-casting alloys. The nearby Arnao plant produces zinc oxide, rolled zinc and zinc wire. The Nordenham electrolytic zinc smelter has an annual production capacity of 145,000 tonnes of zinc metal. The smelter is well located for receiving sea-borne concentrate feed and benefits from its proximity to major European zinc consumers See www.xstrata.com/prod_zinc.php for further information. About Votorantim Metais Votorantim Metais belongs to a private Brazilian industrial conglomerate that is market leader or has outstanding share in every market segment in which it operates, including cement, pulp and paper, metals, chemicals, and orange juice. In 2005, Votorantim Group’s revenues amounted to US$7.8 billion. The metal business division accounted for 30% of revenues and produces zinc, nickel, steel and aluminium. Votorantim Metais is the world's seventh largest primary zinc producer with 400,000 tonnes per annum capacity and three operating zinc smelters and two operating zinc mines. It owns the Cajamarquillia zinc smelter and is the major shareholder of Milpo, both located in Peru. Votorantim Metais would process Perkoa concentrates through the Juiz de Fora zinc smelter in Brazil and the Cajamarquilla zinc smelter in Peru. See www.votorantim-metais.com.br for further information. 3 About Louis Dreyfus Louis Dreyfus Commodities Metals Suisse SA is a wholly-owned subsidiary of LD Commodities BV, which in turn is 100%-owned by Louis Dreyfus SAS. Louis Dreyfus entered the global non-ferrous metals and raw materials trading market in 2005. The business scope covers copper, lead and zinc metal and concentrates, aluminium and alumina, along with other minor and associated metals and by-products. The Group's significant presence in commodity markets around the globe and activities in areas such as shipping afford it a significant advantage in being involved in trading metals and minerals at every stage from mine to end customer throughout the world. Louis Dreyfus companies are present in over 53 countries and annual gross sales exceed US$20 billion. See www.louisdreyfus.com for further information. About Cashmere Marketing Consultants Cashmere Marketing Consultants Pty Ltd is a Brisbane-based consultancy specialising in base metals concentrates with emphasis on copper, zinc and lead concentrates marketing, logistics, product handling, and sales contract administration. Managing Director, W.D. (Bill) Cash has more than 20 years experience in sales and marketing, shipping and logistics, product handling, sales contract administration, feasibility studies, development of marketing strategy for operating and new mine projects and has gained invaluable knowledge of the zinc, lead and copper concentrates and metal markets.
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