perkoa zinc - highly postive bankable

ASX
Announcement
22 DECEMBER 2005
¡°African
Focused
Resource
Company¡±
AIM RESOURCES LIMITED
A.C.N. 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
Alternative Investment
Market with the symbol
¡°AIMR¡±
Continued¡­
PERKOA ZINC - HIGHLY POSTIVE BANKABLE
FEASIBILITY STUDY RESULTS
AIM Resources Limited (ASX code ¡°AIM¡± / London AIM market ¡°AIMR¡±) announces that its
plans to develop the first zinc mine in West Africa have moved a step closer with the
announcement today of the completion of the bankable feasibility study (BFS) for the high
grade Perkoa Zinc Project in Burkina Faso.
The BFS indicates total Revenues from the project of USD1.3 billion (AUD1.7 billion) and a
Net Present Value (¡°NPV¡±) of the Project of USD147.7 million (AUD197.0 million) based on
a discount rate of 10%. The NPV equates to AUD38.6 cents per AIM share.
The current market capitalisation of AIM Resources is AUD29.1 million based on
yesterday¡¯s share price of AUD5.7 cents.
The project capital cost required to bring the mine and process plant into production in
2007, is USD 72.5 million. The Feasibility Study indicates that cash flow from the
operations will repay all establishment capital costs within the first two years of full
production.
AIM Resources¡¯ Managing Director Mr Marc Flory said ¡°we are extremely pleased to have
reached this important milestone in the Company¡¯s history, as we now embark on bringing
this mine into production and join the world market as a significant zinc producer¡±.
The Managing Director is currently in Europe negotiating offtake agreements.
The Board extends its thanks to all who contributed to the BFS, which was completed in
the short timeframe of less than nine months from when we took ownership of the Project.
The Directors are pleased to announce the Study findings and note that these are based
on the current Perkoa deposit, and take no account of the future exploration potential
nearby, which is considered by company management to be very high. A review of the BFS
has noted a number of areas where the project may be able to be further optimised due to
the conservative approach taken in this feasibility.
The BFS was undertaken by internationally respected Snowden Mining Industry
Consultants (¡°Snowden¡±). Barclays Capital, the investment banking division of Barclays
Bank PLC and largest mining project financier in the world, are debt financing advisors for
the Project. Seymour Pierce was recently appointed as the Company¡¯s broker for the
London Market. A roadshow is planned for early in the New Year to update potential
financiers and investors on the Project details and financing requirements.
The Company will continue to keep shareholders informed as to the progress of the
project¡¯s development.
For further information please contact:
Marc Flory ¡ñ AIM Resources Ltd ¡ñ 0400 66 88 73
Scott Reid ¡ñ AIM Resources Ltd ¡ñ +61 2 9222 9444
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BFS Results ¨C Financial Analysis Summary
Total Revenue US$1.3bn
Net Operating Pre-Tax Cash Flow US$529.4m
Establishment Capital Cost US$72.5m
Net Present Value (NPV) @ 10% Disc US$147.7m
Internal Rate of Return (IRR) 43.5%
Average Cash Operating Costs (including transport to port)
US$ Per ROM tonne
US cents per pound Zinc Metal
US$53.5/t
18 cents/lb
BFS Results ¨C Mining and Metallurgy
Life of Mine (including development) 14 years
Total Ore Produced 6,271,961 tonnes
Total Dry Concentrate Produced 1,630,087 tonnes
Total Zinc Metal Produced (in concentrate) 848,390 tonnes
Average Zinc Recovery 93.5%
Average Ore Throughput (approx.) 0.5mtpa
Mining Diluted Head Grade (%Zinc) 14.47%
Summary of Key Assumptions
Zinc market price (LME close on 16 December 2005) US$1815.50 per tonne
Discount Rate for Net Present Value (NPV) Calculation 10%
Cashflow Basis (includes full capital costs) After Tax
USD/AUD Exchange Rate 75 cents
Aim Resources Share Price 21 December 2005 A$0.057
Market Capitalisation (based on shares issued) A$29.1m approx
Note:
1. Smelting charges and deductions for zinc and silver have been estimated based on recent benchmark transactions, but
in the opinion of the company board and management are likely to be improved upon given the continued strong demand
for zinc concentrates from smelters.
2. Revenues and Costs have been calculated on an unescalated basis
3. Base Case figures have been prepared on an ungeared basis
AIM RESOURCES STOCK EXCHANGE
A.C.N. 009 193 980 ANNOUNCEMENT
The information in the Perkoa BFS report as it relates to Exploration Results and Mineral Resources is based on information compiled by
Mr Graham Greenway who is a Member of the South African Council for Natural Scientific Professions. Mr Greenway is employed by
Snowden Mining Consultants. Mr Greenway has sufficient experience which is relevant to the style of mineralisation and type of deposit
under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the
¡°Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves¡±.
The information in the Perkoa BFS report as it relates to Ore Reserves is based on information compiled by Mr Dag Kullmann who is a
Member of the South African Institute of Mining and Metallurgy. Mr Kullmann is employed by Snowden Mining Consultants. Mr Kullmann
has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which
he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ¡°Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves¡±. Mr. Kullmann consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears.
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www.aimresources.com.au
AIM RESOURCES STOCK EXCHANGE
A.C.N. 009 193 980 ANNOUNCEMENT