GRAND BAIE, MAURITIUS--(Marketwired - April 19, 2017) - Alphamin Resources Corp. (TSX VENTURE:AFM) ("Alphamin" or the "Company") is pleased to announce that the Alphamin Bisie Mining Project ("the Project") has commenced the construction of the mine box cut and upgrade of the access road following the mobilisation of two earthworks contractors to site, and the appointment of the mining contractor. Alphamin is also pleased to announce the appointment of two experienced directors, Bernard Swanepoel and Paul Baloyi, to the Company's Board. The appointments are subject to regulatory approval.
The recent completion of the Front-End Engineering Design (FEED) program and associated Control Budget Estimate (CBE) by DRA Projects (DRA), the engineering, procurement and construction contractor for the project, confirmed the robust economic metrics and potential of the Project, and its development into North Kivu's first commercial mine, and a new premier global tin producing mine.
A comprehensive process for estimating capital costs was followed and the CBE results illustrated that the Project has the potential to remain strongly profitable at lower tin prices, as well as at increased prices for key consumables. The completed FEED and CBE increase proven and probable reserves to 4.67 Mt at 3.58% Sn containing 167.3 Kt of tin, while also increasing the life of mine (LoM) to 150 months or 12.5 years. The optimised process flow sheet resulted in 6% higher annual average plant throughput rates, and an increase in tin recoveries to 73%. The borehole drilling to prove the current reserves and provide mine planning has been carried out to a depth of 550 meters below surface and 720 meters down plunge. This results in a current planned life of mine of 12.5 years producing an average of 373,800 tonnes of Rom per annum. The Logistical challenge of locating a deep drilling rig on site restricted the evaluation of the resource to a proven reserve below this Level. The confidence of the drilling to date and the geological model indicates that the resource continues at depth. If this deep drilling is successful, management believes that it should allow for the current life of mine estimate for the Project to be increased.
A cash margin of some US$ 11,040 per tonne of tin sold is foreseen, yielding a LoM annual average EBITDA of approximately US$ 110 million (constant 2017 terms), and robust economic performance indicators of a Net Present Value (8%) of US$ 402.2 million, a real, after tax, Project IRR of 49.1%, and a projected payback period of 17 months from first tin production.
CONTRACTORS MOBILIZED, EXCAVATION OF BOX CUT AND UPGRADE OF ACCESS ROAD COMMENCED
Alphamin has appointed Kongo River SA and VRSC SARL (VRSC) as the Project's earthworks contractors, and Reliant Congo SARL ("Reliant") as the Project's Phase I mining contractor. The appointment of these contractors followed a stringent due diligence process and evaluation of each potential contractor's safety records, submitted schedules, DRC experience, technical capacity and price.
VRSC has worked on the construction of both Banro Corporation's mines in South Kivu & Kibali in the North-Eastern corner of the DRC.
Reliant operates in the Democratic Republic of Congo and Zambia, and have a strong track record of safety and production. Reliant have worked for Glencore plc (Glencore) in the DRC & and continue to mine for Glencore in Zambia, and Vedanta Resources plc in India. Reliant are in the process of mobilising their equipment to begin developing the decline in early July 2017 in accordance with the project implementation schedule.
"It is very encouraging that work has commenced, and subject to finalisation of the full funding solution, the Project is expected to be completed on time, and within budget by the end of Q1 of 2019." says Boris Kamstra, CEO of Alphamin Resources Corp. "Alphamin has appointed three contractors following an extensive tender process and the early works have commenced at the Alphamin Bisie Mining Tin project," explains Kamstra.
"A total of 22 heavy earthmoving machines, their operators, management, and support have been deployed for work at the Mpama North site and on the access road. The work on the box cut and the continued upgrading of the 34km access road has already commenced, following the completion of the initial 9km of the access road upgrade to enable the carrying of normal traffic. The access road is expected to be completed by December 2017," states Kamstra.
In addition, the return airway has advanced to 97m, and the orebody is expected to be intersected at 120m. The camps and associated infrastructure to house the project implementation team, has been completed.
The development of the Project will be a catalyst for regional economic growth. "Alphamin is committed to contributing to the stability and economic activity in North Kivu, bringing significant benefit to the community and other stakeholders alike," says Kamstra. "We are cognisant of the importance of managing and delivering on community expectations. We have been careful in positioning ourselves as a catalyst for change, not as the source or sole reason for change," he says. "We are particularly confident that the recent establishment of the government committee, CAIMB, will help Alphamin in both the development of the project and addressing the communities' concerns".
Community development activities are implemented via the Lowa Alliance (a not-for-profit foundation funded by the Company's DRC subsidiary, Alphamin Bisie Mining SA. (ABM) in collaboration with the Walikale local community) and include the recent inauguration of the flagship Luuka Primary School at Logu in February by the North Kivu Minister of Mines and the Deputy Ambassador of South Africa, and the commencement of a further 10 development projects for 2017 out of the 115 envisioned for the first five years of the Bisie Tin Project.
SOLID PROGRESS MADE ON FUNDING PACKAGE
Alphamin is also pleased to announce that significant progress has been made towards finalising the funding package for the Project. Funding will include a combination of debt, equity and an equity standby facility. It is anticipated that the total funding package will be finalised within the next four weeks, and further announcements will follow in this regard as appropriate.
APPOINTMENT OF NEW BOARD DIRECTORS
Bernard Swanepoel and Paul Baloyi, seasoned business executives with significant experience and expertise, have accepted invitations to join the Board of Directors of Alphamin, subject to regulatory approval.
Charles Needham, Chairman of Alphamin Resources Corp. expressed his delight at the Board appointments, stating: "We welcome the new board members and look forward to their contribution. The calibre and top level experience of the two gentlemen will stand Alphamin in very good stead. Not only do they enjoy international business clout and respect, but their expertise will add value to the Board as it guides the Alphamin business into a prosperous future."
Bernard Swanepoel holds a BscEng (Mining) and BCom (Hons) (FinManagement), and currently serves on the boards of Impala, Zimplats, AREP (a clean energy company), eXtract Limited and African Rainbow Minerals Limited. He is a partner in THINKspiration (a leadership and strategy consultancy), founder of To-The-Point Growth Specialists (active in the junior mining space), Chairman and managing partner of MMC, a privately-owned manganese value added producer, and recently created a R1bn resources investment fund in partnership with eXtract and other investors. He is also the Chairman and co-owner of the annual Joburg Indaba (SA's premier Mining conference), as well as President of the AHi (SA's SME Business Chamber).
Bernard has over 30 years experience in local and international mining, and mining project development. He started his career at Gengold, moving to Rand Mines in the mid-nineties, where he remained as CEO of Harmony Gold Mining Company Limited until 2007.
Paul Baloyi, the Industrial Development Corporation's representative on the Company's Board, holds an MBA (University of Bangor Manchester), MDP, AMP (INSEAD) and SEP (Harvard), and currently serves on the Boards of Old Mutual South Africa, Basil Read Limited (Chairman), Bidcorp Limited, ENX Group Limited amongst others.
Paul has over 35 years of experience in the international finance sector, having served as Chief Executive Officer of the Development Bank of Southern Africa (including the DBSA Development Fund), Managing Director of Nedbank Africa, and holding senior positions within Standard Bank. He is a past member of the Institute of Bankers and the Institute of Directors.
Paul Baloyi commented on his appointment to the Alphamin Board "I am very very pleased and excited for the opportunity to join the best team assembled on what is increasingly proving the be great project . I am looking forward to adding value on the development of the mine."
MORE INFORMATION ON ALPHAMIN RESOURCES CORP.:
Alphamin is a tin exploration and development company with the vision to be respected in the international tin sector by unleashing the full profit and potential of its world-class tin asset in North Kivu, DRC currently under development.
Alphamin has the vision to become a premier tin producer by:
- Leading a world-class, profitable mining company in North Kivu, delivering results for the benefit of all stakeholders and viewed with respect by the communities and Government.
- Becoming a profitable tin producer, while continuing with exploration to increase life of mine. ABM intends to operate a profitable tin mine in a safe environment while uplifting the local community. Alphamin is striving to develop the first, low-cost per tonne tin, industrial mine in North Kivu, while at the same time making a marked, positive impact on the communities surrounding the mine. We intend to be a tin mining company that excels at the production of tin and provides leadership for the region in terms of safety, health, environment and community development.
- Delivering on the commitment to develop the first large, industrial tin mine in North Kivu - giving Alphamin credibility locally and abroad - and becoming a business transformation reference in the tin mining industry.
- Creating value for both shareholders and the community.
- Committing, from the date of production, to spend 4% of its in-country operating and administrative expenses on community development. This investment will be governed with representative input from local communities and managed by the Lowa Alliance, a GDRC-regulated not-for-profit foundation. Alphamin will continue to preserve its legal rights to develop Bisie and explore ways to assist artisanal miners to transition from illegal to legal status, conflict-free sites elsewhere in the region.
- Implementing community projects, supported by the Lowa Alliance, being selected following an in-depth survey of the 13 500 households (approximately 70 000 residents) across the 44 communities closest to Bisie. Representative committees have prioritised a range of projects to promote social and economic development to which they, local authorities and potentially external donors, will also contribute. These projects would provide incentives for income beyond illegal artisanal mining while also providing educational and health infrastructure and services like potable water, malaria reduction and treatment and primary health care capacity building, agricultural and infrastructure capacity investment.
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Information in this news release that is not a statement of historical fact constitutes forward-looking information. Forward-looking statements contained herein include, without limitation, statements relating to costs of production, success of mining operations, the ranking of the project in terms of cash cost and production, economic return estimates, social, community and environmental impacts, and continued positive discussions and relationships with local communities and stakeholders. Forward-looking statements are based on assumptions management believes to be reasonable at the time such statements are made. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Although Alphamin has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Factors that may cause actual results to differ materially from expected results described in forward-looking statements include, but are not limited to: Alphamin's ability to secure sufficient financing to advance and complete the Bisie Tin Project, uncertainties associated with Alphamin's resource and reserve estimates, uncertainties regarding global supply and demand for tin and market and sales prices, uncertainties associated with securing off-take agreements and customer contracts, uncertainties with respect to social, community and environmental impacts, adverse political events, uncertainties with respect to optimization opportunities for the Bisie Tin Project, as well as those risk factors set out in the Company's Management Discussion and Analysis and other disclosure documents available under the Company's profile at www.sedar.com. Forward-looking statements contained herein are made as of the date of this news release and Alphamin disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws."