Joint Venture - CAR
Pan African Resources PLC
05 October 2005
5th October 2005
Pan African Resources
('Pan African' or 'The Company')
Pan African Acquires an Interest in JV in the Central African Republic
Pan African Resources PLC (AIM:PAF) the African based gold exploration company
announces that it has entered into a joint venture with International Mining
Investments Ltd and Goldiam SARL to do exploration in the Central African
Republic ('CAR').
• Despite the CAR being relatively unexplored, a near-surface grassroots 2m
oz greenstone gold deposit has recently been delineated in the country by
another company
• Pan African and its partners exploration activity is being managed by
Pangea Exploration (Pty) Ltd with a proven track record of discovering gold
deposits of this nature
• The first phase of the exploration is underway
Pan African and International Mining Investments Ltd (a totally independent
company from Pan African) will each hold a 45% contributory stake in the joint
venture. The new joint venture through Goldiam SARL (which is Pan African's
independent local joint venture partner and which holds 10% in the joint venture
as a free carry for providing in country logistical services), has been granted
an exclusive Exploration License (the Bogoin Exploration License) and three
Reconnaissance Permits (the Dekoa, Bozoum and Baboua Permits) in accordance with
the Country's new Mining Code. Goldiam SARL will serve as the legal operating
entity for the joint venture in the CAR. Failure by either party to
proportionately contribute to the joint venture will result in dilution
proportionate to cash contribution.
Pan African and its partners hold title to 2 of the 4 known major greenstone
belts in the CAR. These greenstone belts are part of the craton hosting the
Kilo-Moto gold camp in the Democratic Republic of Congo, which has produced more
than 10 million ounces of gold. The initial exploration activity is focusing on
the Bogoin Exploration License where a number of shallow gold intercepts were
made by GTZ (Deutsche Gesellschaft fur Technische Zusammenarbeit) in the early
1990's. Two of the best intercepts were 17,38g/t over 19m and 5.05g/t over 20m.
These results were never followed up. A gold soil geochemical anomaly (also
delineated by GTZ) with a strike extent of more than 1km, north of these
intercepts is currently untested. The main target is banded ironstone-hosted
gold mineralisation associated with major shear zones that also remains
unexplored.
Recent exploration activity has shown that the Central African Republic despite
being relatively unexplored is prospective for gold. A North American company
has announced a grassroot discovery of a 2m ounce gold deposit in the CAR at
Passendro circa 300 km east of the Company's Bogoin project and circa 150 km
east of the Company's Dekoa project. Of significance is that the Company's two
deposits at Bogoin and Dekoa outcrop on surface and are similar to
greenstone-hosted deposits elsewhere in the world.
The company and its partners have an experienced geological team managed by
Pangea Exploration (Pty) Ltd ('Pangea') in place within the CAR and the first
phase of the exploration program is well advanced. Pangea has a proven track
record with regard to greenstone gold exploration in Africa, being responsible
for the discovery of various gold deposits such as Tulawaka, Buzwagi and Golden
Ridge in Tanzania.
A commission payment is due to Pangea Exploration (Pty) Ltd ('Pangea') for
introducing Pan African to the joint venture opportunity. The total commission
becomes due in three annual installments of £105,000, which will only be payable
for as long as Pan African remains part of the joint venture and subject to Pan
African holding sufficient funds to both make each payment and fund the
exploration activities required.
As the consideration potentially payable is both conditional and deferred, such
consideration will be increased by the percentage that the price of any future
fundraising prior to each payment, is above 1.75p per share at the time of each
payment. Pan African has the right, but not the obligation, to settle such
future payments by the issue of new shares in Pan African, priced at the same as
the future fundraising price.
Pan African has the right to terminate the joint venture agreement at any time
and will not incur any penalties for doing so. Pan African currently has funds
of £480,000 (including the proceeds from the share subscription as described
below).
Separate to the joint venture agreement, Goldiam SARL has agreed to subscribe to
2,750,000 Pan African ordinary shares at a price of 2p per share for a total
consideration of £55,000. The closing market-price of the Company's ordinary
shares on 3 October 2005 was 2.38p.
'The company's involvement in the CAR is in line with delivering on our
corporate strategy to enhance shareholder value by developing world class
deposits in favourable areas of Africa.' commented Jan Nelson, CEO of Pan
African Resources.
- ENDS -
Enquiries:
Pan African Resources Evolution Securities Parkgreen Communications
Jan Nelson, CEO Tim Redfern Justine Howarth / Victoria Thomas
+27 11 886 1211 +44 (0)20 7071 4312 +44 (0)20 7493 3713
Colin Bird
+44 (0)20 7584 2155
This information is provided by RNS
The company news service from the London Stock Exchange
Latest directors dealings
- 1 day ago Close Brothers Group
- 1 day ago Savannah Energy
- 1 day ago Mid Wynd International Inv Trust
- 1 day ago Dillistone Group
- 1 day ago SSP Group