ZimNRG plc

February 04, 2011 02:00 ET

re Joint Venture Agreement

Joint Venture Agreed

04 February 2011

                                                ZimNRG Plc

The Directors of ZimNRG plc are pleased to announce that a Joint Venture has been  agreed on iron ore
projects near Bulawayo and Esigodini, Zimbabwe. The main features are as follows:

    - Joint  venture agreement with Tagil Resources (Pvt) Ltd, a Zimbabwean incorporated and owned
    company, to earn an interest in a number of mineral claims prospective for iron ore near Bulawayo;
    - ZimNRG can earn up to a 51% interest by a series of staged payments not to exceed US$211,000 and
    exploration programmes leading, via sampling, mapping, drilling and metallurgical testing, to an economic
    scoping study;
    - Both project areas are in close proximity to several dams; electricity is available  close by or
    on the claims; are well served by district and local roads and are between 10km and 22km from a national
    road and railway line connecting to South Africa and Mozambique;
    - The Directors believe that a successful project could lead to the development of a small to medium
    scale producer with a low cost operation based on a target near surface resource base of between 300m and
    400m tonnes;
    - Signature of the joint venture is subject, inter alia, to shareholder approval at the upcoming
    Annual General Meeting of ZimNRG Plc.

    ZimNRG has agreed a joint venture agreement with Tagil Resources (Pvt) Ltd to earn up to a 51% interest
    in a newly formed Zimbabwean holding company which will hold a series of mineral leases over two sets
    of claims covering about half of the the Ntaba Ye Nyoka mountain range (~30 km by road from Bulawayo)
    and all of the Mulungwane mountain range (towards Beitbridge, ~100 km by road from Bulawayo).

    The two properties appear to host outcropping banded iron formation deposits. ZimNRG Plc consulting
    geologist, Dr. Willem Smuts, has visited the properties and has taken grab samples which yielded Fe
    contents of 39.1% and 39.55% on analysis by the Institute of Mining Research at the University of
    Zimbabwe. The Ntaba Ye Nyoka claims, covering 450 hectares, include 3.3 km of prospective strike
    length, while the Mulungwane claims, comprising 1940 hectares, include 13 km of prospective strike

    Christopher Latilla-Campbell, CEO of ZimNRG Plc, commented: "This opportunity is the culmination  of
    several years of searching; we believe that a project of this nature if brought to a successful
    conclusion will be of benefit both to the shareholders of ZimNRG Plc, to our future joint venture
    partners and to the wider economy of Zimbabwe in general. Our initial focus will be on exploration
    leading to an economic scoping study as rapidly as possible. Significant risks remain, at the
    geological, metallurgical, and politico-economic levels not least being the eventual implementation of
    the Indigenisation and Economic Empowerment Act, 2007. For these reasons, the Directors will be seeking
    the approval of shareholders before proceeding with the joint venture."

    Agreement details

    ZimNRG Plc, through a 100% owned Zimbabwean incorporated subsidiary to be renamed Suricate Investments
    (Pvt) Ltd, will under the joint venture agreement earn up to 51% of the issued share capital of Anhood
    Investments (Pvt) Ltd, a special purpose company which has been formed to hold the Ntaba Ye Nyoka and
    Mulungwane claims which are currently registered to Tagil Resources (Pvt) Ltd. Suricate will be the
    operator of the exploration programme and will at all times occupy a majority on Anhood's Board.

    Suricate will acquire 35% of the currently issued shares of Anhood upon signing and fulfilment of the
    conditions precedent within the joint venture agreement in return for payment of US$50,000 immediately
    and a further US$25,000 on completion of the first phase of exploration within 90 days and which is
    estimated to cost ~US$70,000.

    Depending on results, Suricate will then fund two further phases of exploration and testing leading to
    an early stage economic scoping study and which are presently estimated to cost about US$1.12m. In
    return for making this expenditure, Anhood will issue new shares to Suricate bringing Suricate's
    holding to 51%.

    During the earn-in period, Suricate will retain the assistance of Tagil and its principals for a
    retainer of US$8,000 per month, which will be payable for a maximum of 17 months.

    Qualified Person (ZimNRG)

    Information in this report relating to exploration results is based on data reviewed by Dr Willem Smuts
    Pr.Sci.Nat. who has more than 23 years relevant experience in mineral exploration and is a Competent
    Person under SAMREC rules.

    For further information:

    ZimNRG PLC                                                  01403-738 555

    Christopher Latilla-Campbell, Managing Director

    Advisor                                                     0207 628 1128

    Jonathan Willis-Richards,

    Loeb Aron & Company Ltd.

Contact Information

  • ZimNRG plc