CanAfrican Metals and Mining Corp.

May 07, 2007 18:38 ET

CanAfrican Metals and Mining Corp. Announces Agreement to Acquire Gold Mine and Diamond Concessions in Zimbabwe, Southern Africa

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 7, 2007) - CanAfrican Metals and Mining Corp. (TSX VENTURE:CAF) The president and CEO, Mr David R. Way, is pleased to announce the signing of a three part arms-length agreement to acquire:

- a 100% interest in the INDIRAMA Mining Lease located in the central Zimbawean gold belt.

- majority interest in an operating diamond drill company owning and operating four drills located on the lease.

- majority interest in three claim groups covering a diamantiferous pipe and other areas anomalous in indicator minerals located in southern Zimbawe adjoining the Botswana diamond fields.

The Company has paid US$100,000 on the signing of this agreement and on closing will pay US$5,500,000 and will issue 300,000 share options for the interests set out above.

The agreement calls for 120 days to carry out due diligence, which will consist of completion of a 43-101 standard reports on the gold property and on the diamond concessions, as well as obtaining all necessary regulatory approvals.

The Indirama Mining Lease is a consolidation of more than 18 historical gold mines and showings. It consists of 56 claims and covers 16 square kilometers. Current surface infrastructure consists among other things, of two mills rated at 600 tonnes per day and 120 tonnes per day and other associated recovery facilities. The mines are fully permitted both for surface and underground mining and for expanded operations.

The property was worked in the 1990s by Consolidated Trillion Resources Ltd. (now Viceroy Exploration Ltd.). That company produced from some of the mines on the property and carried out a substantial amount of diamond drilling that formed part of the basis for tonnage and grade calculations. These calculations were done using the Australian Institute of Mining and Metallurgy definitions, which are essentially the same as 43-101 definitions but with more detail. The results are summarized as follows:

- Open Pit - 5 million tonnes grading 2.05 g/tonne gold - measured and indicated

- Under ground - 1.2 million tonnes grading 2.48 g/tonne gold - measured and indicated

- 900 000 tonnes grading 5.02 g/tonne gold - measured and indicated

- 300 000 tonnes grading 7.9 g/tonne gold - measured and indicated

- A resource exceeding one million ounces

A historical scoping study suggested that a production rate of 3000 tonnes per day would be the most economical.

Consolidated Trillion Resources terminated its interest in the property in 1999 due to very low gold prices. The mines have been on care and maintenance since then. Currently there are 120 men on the site operating a 600 tonne per day tailings leach plant.

Cautionary Statement

Readers are cautioned that while the historical data quoted herein is considered to be relevant and reliable by the Company, it is based on publicly available sources and does not comply with the guidelines of National Instrument 43-101 as it is not data based on mineral resource estimates verified by a Qualified Person. Readers should not rely upon the historical data until it can be verified by a National Instrument 43-101 compliant study which the Company intends to carry out in due course.

This press release has been reviewed and approved by Al Beaton, a director and the Company's Qualified Person under NI 43-101.

David Way, President and CEO

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • CanAfrican Metals and Mining Corp. - Vancouver Office
    David Way
    President and CEO
    (604) 767-3977
    CanAfrican Metals and Mining Corp.
    London Office
    CanAfrican Metals and Mining Corp.
    South African Office