Zazu Metals Corporation
TSX : ZAZ

Zazu Metals Corporation

March 07, 2011 08:31 ET

Pre-Financing Due Diligence Started on Zazu's Lik Deposit

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 7, 2011) - Zazu Metals Corporation (TSX:ZAZ) ("Zazu") is pleased to announce that the Alaska Industrial Development and Export Authority ("AIDEA") selected the Behre Dolbear Group to complete due diligence on the Lik South deposit. This represents the initial step in AIDEA's decision-making process to finance certain infrastructure requirements. Zazu's Lik deposit is located 22 km from Teck's Red Dog Mine in Northwest Alaska. 

AIDEA, a public corporation of the State of Alaska, owns the haul road and port utilized by the Red Dog Mine ("Delong Mountain Transportation System" or "DMTS"). The DMTS is available to Zazu for the development of the Lik deposit and subsequent concentrate shipment. AIDEA determined that there is sufficient merit in developing the Lik Deposit to warrant due diligence as a precursor to financing of new infrastructure and modifications to the DMTS. AIDEA selected Behre Dolbear Group to conduct this due diligence, and expects their review to be completed within 6 months.

Zazu recently announced private placements that provided sufficient funds to complete a feasibility study on the Lik deposit and conduct exploration drilling on the contiguous Lik North deposit, which already hosts a high-grade Inferred Resource. These are not dependant on the AIDEA due diligence process, and Zazu is currently planning their initiation.

The zinc market will be faced with several large mine closures over the next five years, with limited potential for replacement. Zazu offers investors the opportunity to participate in a large, high-grade sulphide and open-pittable zinc deposit, located 20km from existing infrastructure.

In May of 2010, Zazu announced a positive Preliminary Assessment Study ("PAS") completed by Scott Wilson Roscoe Postle Associates ("Scott Wilson RPA"). The study also identified several areas where the economics could be improved. As part of the due diligence process required by AIDEA, Zazu retained JDS Energy and Mining ("JDS") and PND Engineers, Inc ("PND") to evaluate those areas and investigate others. Their subsequent analysis suggested that the IRR of the project could be significantly improved from the PAS estimate. 

The JDS study is available on the AIDEA website. It is conceptual in nature, and not NI 43-101 compliant, and accordingly cannot be relied upon. The PAS is available on SEDAR.

In May of 2009, Scott Wilson RPA completed an updated Mineral Resource estimate. Their estimate of Lik South is an Indicated Mineral Resource of 18.74 million tonnes grading 8.08% zinc, 2.62% lead and 52.8 g/t silver; plus an Inferred Mineral Resource of 1.23 million tonnes grading 6.80% zinc, 2.12% lead and 35 g/t silver, at a 5% cut off grade. Lik North is an additional 5.18 million tonnes grading 9.65% zinc, 3.25% lead and 51 g/t silver of Inferred Resource at a 7% cut off grade. Mineral resources that are not mineral reserves do not have demonstrated economic viability. 

The part of this news release pertaining to the Mineral Resource estimate was reviewed by Dr. William E. Roscoe, P.Eng., a Principal Consulting Geologist with Scott Wilson RPA, and Neil N. Gow, P.Geo., Associate Consulting Geologist with Scott Wilson RPA, both of whom are qualified person as defined by National Instrument 43-101.

About Zazu Metals:

Zazu is a Canadian-based exploration company focused on acquiring and developing base metal properties in North America. Zazu's principal asset is its 50% interest in the Lik zinc – lead - silver deposit in North West Alaska. Teck is a 50% joint venture partner in the Lik deposit. However, Zazu has the exclusive right to obtain 80% of the property by meeting certain spending commitments by 2018. Zazu is in the enviable position of having a limited number of shares outstanding, a strong treasury and no debt.

Additional information about Zazu including a company presentation is available at www.zazumetals.com

Additional information about the property is on the Teck website (www.teck.com). Zazu is not responsible for the content, accuracy or timeliness of material contained on the Teck website. 

ON BEHALF OF THE BOARD OF DIRECTORS
Gil Atzmon,
Chairman and CEO

Some of the statements contained in this news release are forward-looking statements, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

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