Reported changes to Guinea resource companies (0284A)
January 25 2011 - 4:09AM
UK Regulatory
TIDMBZM
RNS Number : 0284A
Bellzone Mining PLC
25 January 2011
25 January 2011
Bellzone Mining plc
("Bellzone", the "Investor" or the "Company")
Reported changes to Guinea participation in resource
companies
Bellzone Mining plc (AIM:BZM), the iron ore and nickel/copper
company developing the Kalia Iron Mine and Forecariah Joint Venture
in the Republic of Guinea, West Africa, reports that it has not had
any notification and does not have any information to indicate that
it will be subject to the alleged proposed changes, as reported in
some press, pertaining to the government of Guinea's approach to
participation in resource companies.
Bellzone has a Mining Convention (the "Convention") for its
Kalia Mine (the "Mine" or "Project") and associated infrastructure
that was approved and signed by the Guinean Minister of Mines and
Geology and the Guinean Minister of Economy and Finance on the 26th
of July 2010. As per the statutory process the Convention was
passed into Guinea law through a Presidential Decree signed on the
31st of August 2010.
Nik Zuks, Managing Director, commented: "It is important to note
that our Convention has been decreed and is subject to an economic
stabilisation agreement. We believe that our Convention is fair and
provides an equitable split of economic benefits to Guinea and our
investors.
With any change in government it can be expected that there will
be a review of revenues and expenditures and operator adherence to
their licence conditions. It is reasonable that the new government
will look to review and streamline existing revenue collection
processes and systems."
The Convention is based on Guinea's well established Mining Code
and contains provisions that exceed the minimum conditions
contained in the Code to ensure an equitable sharing between the
Company and Guinea of the economic and social benefits associated
with the Kalia Mine. The Convention is subject to an economic
stabilisation clause that exempts Bellzone from increases that may
be promulgated, but allows the Company to apply for benefits that
may become available through subsequent changes.
Enquiries:
Bellzone Mining plc
Nik Zuks
Raj Kandiah +61 439 420 893
Canaccord Genuity Limited
Nominated Adviser and Joint Broker
to Bellzone
Andrew Chubb/Tarica Mpinga +44 (0)20 7050 6500
Renaissance Capital Limited
Joint Broker to Bellzone
Simon Matthews/Thomas Beattie +44 (0)20 7367 7777
Tavistock Communications +44 (0)20 7920 3150
Jos Simson/Paul Youens +44 (0)7899 870 450
Bellzone Mining plc
Bellzone Mining plc is an exploration and resource development
company with iron ore and nickel / copper permits in the Republic
of Guinea, West Africa.
The Company's flagship project, the Kalia Iron Mine has a JORC
resource of 3.74 billion tonnes, located on the Kalia I prospect.
Drilling results and internal estimates indicate that Kalia
Prospect has the potential to host more than 10 billion tonnes of
magnetite and 2.55 billion tonnes of oxide at surface.
Exploration work continues to further define the potential at
Kalia I on both the magnetite and oxide at surface.
Bellzone is committed to the staged development of the Kalia
Iron Project, which includes a 50mtpa iron ore facility, rail and
port, with initial production scheduled in 2014. Stage one is
planned to bring online 20mtpa direct shipping ore ('DSO') capacity
in 2014 and a 10mtpa magnetite concentrator in 2015. Stage two
increasing the DSO output to 30mtpa in 2017 and doubling the
concentrate capacity to 20mtpa by 2018.
Bellzone signed an Infrastructure Accord with the Republic of
Guinea giving the Company exclusive rights to the designated port
and rail areas for purposes of conducting studies for the
development of the infrastructure leading to the signing of a
convention and concession. The infrastructure forms a key part of
the Guinea Government's infrastructure strategy and will support
the development of iron ore, bauxite and other minerals in Guinea
through its availability for 3rd party use.
On 2 August 2010, Bellzone signed definitive agreements with
China International Fund ('CIF'). CIF will finance and develop the
rail and port infrastructure and offer a finance package to
Bellzone for the development of the Kalia Mine in exchange for the
first right to purchase 100% of the off-take of the Kalia Mine at
market price.
An exploration programme is currently underway at the CIF held
Forecariah Iron Permits that lie between 40 and 80kms from the
Guinea coast. Bellzone and CIF will jointly develop these permits
which are prospective for oxide and magnetite. The oxide has the
potential to deliver cash flow from a Direct Shipping Ore project
in the short term.
Bellzone has competed an intensive mapping and surface sampling
programme and has defined highly prospective drilling targets at
its Sadeka Nickel/Copper Project and commenced a drilling programme
on these targets in Q4 2010.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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