Southeast Asia Mining Corp.

Southeast Asia Mining Corp.

March 01, 2011 12:16 ET

Southeast Asia Mining Renews Joint Venture Agreement for Lead Zinc Mine in Thailand

TORONTO, ONTARIO--(Marketwire - March 1, 2011) - Southeast Asia Mining Corp. ("SEA" or the "Company") announces that it has signed, through its subsidiary – Geotai Exploration and Mining Co. Ltd. ("Geotai"), a new joint venture agreement with Kanchanaburi Exploration and Mining Co. Ltd. ("KEMCO") and Boh Yai Mining Co. Ltd. ("Boh Yai") (the "Joint Venture Agreement"). The Joint Venture Agreement replaces the original agreement signed in 2006. The signing of the Joint Venture Agreement provides for the required mining license renewals to be obtained as quickly as possible which will allow mining to commence. Further details on the Joint Venture Agreement are outlined below.

The KEMCO properties represent SEA's main assets within Thailand. KEMCO is a former 1,200 tpd producing base metal mine that ceased production in 2002 when the mining licenses lapsed. The KEMCO mine has in excess of 15 years of mine life with the current resource base based on the 43-101 report that was prepared for the Company and filed on SEDAR on November 27, 2008. Renewal of the mining licenses is in process and renewal will require additional work to be completed including a health impact assessment as well as additions to the environmental impact assessment. The Company has received proposals to complete these assessments and expects to commence work shortly. Meanwhile, exploration work has commenced on the four Special Prospecting Licenses (SPL's) directly surrounding the two mine sites to identify additional resources as announced by the Company on February 24.

The key amendments to this Joint Venture Agreement include:

  • Simplified contract which updates the previous Joint Venture to present time and acknowledges receipt of payments from SEA for the refurbishment of plant and processing of the stock-pile ore;
  • Provides Geotai with the right to appoint a new advisor to KEMCO;
  • Provides Geotai with input into budgets and operating programs for the operation of the mine and mill assets;
  • Provides for the payment of 7,200,000 Thai Baht (approximately US$235,000) as compensation for terminated employees and accrued compensation for current employees over next three months;
  • Provides for the payment of US$6,500 per month for current mine employees; and
  • Provides for an investment of US$2 million by the Company by March 1, 2012 and a reduction in ownership from the current ownership level of 80% to 50% in the event this investment is not made by the Company by that date.

Southeast Asia is a junior exploration and mining company operating in Thailand and Southeast Asia. Its main asset is a majority ownership in a former base metal producer which, in conjunction with its Thai partner, is in the process of renewing the mining licenses. The Company has seven special prospecting licenses in various stages of exploration.

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