· Bankable Feasibility Study delivers a profitable Zinc Mine producing an average 116,000 tonnes per annum of Zinc in concentrate for 14 years.
· Establishment Capital Costs are estimated at US$72.5 million with operating costs of US$ 53.50 per tonne or US 18 cents a pound of Zinc Metal produced excluding smelter costs.
· Life of Mine Project Net Present Value at a 10% discount of US$ 147.7 million, giving a Internal Rate of Return of 43.5% based on a Zinc price of US$ 1,815 per tonne. The current spot LME price of Zinc is US$2,220 per tonne as of 27 January 2006.
· Appointment of Seymour Pierce as London Brokers to assist with Project Capital Raising.
DRILLING PROGRAM FOR MUMBWA PROJECT IN ZAMBIA
· · Finalising a mapping and drilling program on the Mumbwa target areas.
PROJECT REVIEW
Perkoa Zinc Project, Burkina Faso (AIM 100%)
AIM Resources Limited is pleased to have received from Snowden Mining Consultants (“Snowdens”) the Bankable Feasibility Study (“BFS”) on the Perkoa Zinc Project as released to the market on 22 December 2005.
The key parameters of the BFS outline a project with a Proved and Probable Reserve of 6.27 million tonnes at a mine head grade of 14.5% Zinc, utilising a cut-off grade of 9% Zn. This equates to a total of 907,679 tonnes of contained Zinc metal.
The BFS incorporates a mine design consisting of a shaft and decline to access the ore body, ramping up to deliver 525,000 tonnes per annum of Run Of Mine (“ROM”) Ore to a simple process facility. This facility comprises a crushing circuit followed by dense media separation, milling and floatation, resulting in the production of 116,000 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 reuse in the processing plant. The main source of process water will be from a dam that has recently been constructed by the Burkina Authorities, close to the Perkoa Deposit. Power will be provided by on site diesel generators.
The BFS has addressed the transportation and logistics required to construct the Plant and Infrastructure by reviewing two alternatives available. The first uses the rail line situated 30 km’s from the Perkoa project passing through the neighbouring country of Cote D’Ivoire to the Port of Abidjan. The second uses road transport alternatives passing through Ghana to port facilities at Tema.
AIM Resources Limited is currently assessing off take counter parties for the Zinc Concentrate and expects to finalise arrangements shortly.
The BFS estimates life of mine revenues of US$ 1.3 billion (A$1.7 billion), generating a project Net Present Value of US$147.7 million (A$ 197 million) after tax, equating to A$0.38 cents per share, at a discount rate of 10% and a zinc price of US$1,815 per tonne. This is a significant premium to the prevailing market capitalisation of the Company of A$36.3million at A$.071 per share as at 27 January 2006. The Projects all equity Internal Rate of Return is 43.5%.
Establishment Capital Costs are estimated at US$ 72.5 million with expected cash operating costs of US$53.50 per ROM tonne, equating to US$0.18 a pound of zinc produced excluding smelter costs.
The Company is working with its Debt Financial Advisors, Barclays Capital of London, to arrange the Project Financing. In order to facilitate the equity component of the package, AIM has appointed a new Broker in London, Seymour Pierce. Mr Charles Kernot, Head of Research at Seymour Pierce, was recently voted as Research Analyst of the Year by his peers at the recent Mines and Money conference in London in November 2005.
The AIM Resources-BHP Billiton Joint Venture over The Mumbwa Prospecting License (PL LS39) in Zambia continues to gather momentum.
AIM Resources, as manager of the Joint Venture has conducted its Joint Venture meeting with its partner, BHP Billiton, on site in November 2005. The meeting incorporated visits to each of the high priority target areas identified from the Falcon Airborne Gravity Gradiometer Survey, received in mid 2005, and additional desk top review.
Final data analysis is currently being reviewed and AIM Resources is finalising the logistics to complete a proposed mapping and drilling program. It is envisioned that this campaign will be undertaken after the end of the wet season. This timing remains highly dependent on securing a satisfactory drilling contractor and the end of the current wet season that was very late starting.
MOKOPANE PROJECT (AIM RESOURCES 100%)
A focused drilling program to extend the existing resource of the Mokopane project continues await ministerial consent for the conversion of the old order prospecting right to a new order right. AIM has received notification from the Department of Minerals and Energy that all requirements have been met for the conversion to be approved.
GHANA PROJECTS
AIM Resources Limited continues to review and evaluate the projects of Equator Resources Limited in which it has earned a 25% interest. This may be increased to 70% by the expenditure of a further US$650,000 before December 2008.
CORPORATE
Annual General Meeting
AIM Resources held its AGM on November 18, 2005 and all resolutions were passed.
Appointment of London Broker
AIM Resources Limited appointed Seymour Pierce, a leading provider of corporate broking and corporate finance to smaller companies listed in the London Stock Exchanges Alternative Investment Market, as part of the Financing requirements for the Perkoa Zinc Project.
Cash & Investments
As at 31 December 2005, AIM had A$3.6 million in cash, at call deposits and share market investments. This includes a 7.66% interest in ASX listed company Discovery Nickel Ltd (ASX code DNL)
Issued Capital
As at 31 December 2005 the Company had:
· 511,889,031 ordinary shares on issue
· 71,025,000 unlisted options at various strike prices and dates.
· 137,366,789 listed options at a strike price of 10 cents, expiring 30 June 2009.
· 14,000,000 performance rights expiring 30 November 2007
For further information contact:
AIM Resources Hichens, Harrison & Co Parkgreen Communications
Marc Flory + 61 400668873 Christian Dennis Justine Howarth / Ana Ribeiro
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