VANCOUVER, BC, Nov. 30, 2021 /CNW/ - East Africa Metals Inc.
(TSXV: EAM) ("East Africa", "EAM" or the "Company") would like to
provide an update on the ongoing exploration of its gold and
gold/copper/zinc projects in the Federal Democratic Republic
of Ethiopia ("Ethiopia").
Mining Licences
EAM currently has three approved
Mining Agreements with Ethiopia's Ministry of Mines and
Petroleum (the "Ministry"); the Terakimti Oxide deposit Mining
license has been issued (news release dated December 7, 2017)
and Mining Agreements for the Mato Bula and Da Tambuk deposits have
been approved and licences issued (news release dated May 29, 2019).
All the mining licenses are currently under project development
agreements.
Mato Bula and Da Tambuk transaction are under a project
development agreement with Tibet Huayu Mining Co., Ltd. that
purchased a 70% interest in the Company's Mato Bula and Da Tambuk
Mining Licenses by making a cash payment of US$1.2M and financing 100% of the US$88M capital costs and operating the mines.
Under the agreement EAM will retain the exploration rights to all
prospective mineralization on its concession areas outside of the
current resource (news release dated August
23, 2019).
EAM's interest in the Harvest Project is the subject of a
non-binding Letter of Intent with Zijin Mining Group Company Ltd.
("Zijin") to acquire a majority ownership interest in project by
making a cash payment of US$900,000, developing and funding
100% of EAM's obligations related to the development and operation
of the Harvest Project. Under the agreement EAM will retain the
exploration rights to all prospective mineralization on its
concession areas outside of the current resource
Exploration and Drilling
East Africa is prepared to initiate a fully
funded $2,700,000 exploration program
announced in early 2021 (see new release February 1, 2021), once commercial activity in
the Tigray region normalizes and it recovers from the impacts of
the COVID pandemic and the political unrest.
EAM has completed the planning and received government approval
for the $2,700,000 exploration
program (news release dated January
28, 2020) that will include diamond drilling, geophysical
surveys, environmental, metallurgical studies and resource
assessments. The initiation of the exploration program is expected
to begin immediately after the Government declares the region ready
for field operations.
EAM's management has confidence in the potential of the
Company's exploration assets in the Tigray region and looks forward
to continued participation in what has become an active and
emerging exploration sector.
Listed below are the exploration targets that host potential to
improve current resources and potentially increase the total
resource base (news release dated May 7,
2018). Highest priority exploration targets that have
potential to increase the resource base will be the focus of Phase
1 drilling.
- Halima Hill I.P. – Represents a
compelling target as a large, open (to depth and southward) I.P.
chargeability anomaly extending laterally 500 metres south beyond
the established Mato Bula mineralization. The currently defined
copper/gold mineralization increases in silver and zinc content
locally in the south region of the resource. Being an open I.P.
target, the feature requires drill qualification and has potential,
with mineralization identification, to represent a significant
spatial increase to the known mineralized footprint. A key
intersection in this area includes 24.50 metres grading 0.61 grams
per tonne gold, 1.67% copper, 8.0 grams per tonne silver, and 0.96%
zinc, from 204.30 metres (WMD027- news release dated January 15, 2015). Halima
Hill is considered a high priority target.
- Mato Bula Central – Results from the 2017 infill drilling
program identified areas of potential high grade mineralization for
step out drilling to depth in the central area of Mato Bula.
- Mato Bula North- A separate
copper enriched area of the existing resource remains open
laterally and to depth and requires further delineation
drilling.
- Da Tambuk deposit – Infill and extension drilling required
(deposit currently open to depth and south).
- Terakimti sulphide extension to depth.
Exploration Extension Rights
EAM management has been
advised by the Ministry certain exploration rights in Ethiopia granted to EAM subsidiaries in
January 2020 have reportedly been
granted to a third-party. This action by the Ministry has
occurred despite these exploration rights being legally held by EAM
and protected by declarations of Force Majeure.
EAM has been able to confirm through Ministry records that this
reported action by the Ministry does not impact any of the existing
Mining Licenses nor does it affect exploration rights to any
priority exploration targets in which EAM has an interest.
The license EL00057, purportedly granted to a third-party,
includes property interests that are the subject of a valid
Exploration License Period Extension Agreements (the
"Exploration Rights") granted by the Ministry to Ethiopian
subsidiaries of East Africa Metals Inc. ("EAM") on
January 28, 2020. On May 27, 2021, the Ministry wrongly purported to
terminate the License in breach of EAM's legal rights. EAM strongly
disputes the validity of the Ministry's purported termination of
the Exploration Rights and subsequent grant to a third-party.
The Company has formally filed Legal Notice in compliance with
the Company's rights under the Ethiopian Mining Laws and will
continue to demand the Ministry cancel any exploration license(s)
granted to third-parties in the areas previously granted to EAM
subsidiaries and affected by force majeure events and reinstate
them to EAM.
Andrew Lee Smith, CEO of
East Africa commented, "East
Africa Metals' management and Board of Directors are surprised and
disappointed by the Ministry's actions taken against the interest
of EAM shareholders and all stakeholders in the Company's Ethiopian
exploration projects.
The Company intends to continue to prepare a legal position and
take legal action against the Ethiopian Ministry of Mines and any
companies or individuals who have benefited from this decision at a
time the Company considers appropriate.
After twelve-years of investments totaling $30M and exploration success by EAM and
$15M in funding provided to the
Ethiopia Ministry of Mines and Petroleum by Global Affairs Canada
to address issues of accountability, tenure security and
transparency EAM's management and Board of Directors fail to
see how this unwarranted and regressive action by the Ministry of
Mines benefits stakeholders or encourages investment in
Ethiopia's resource sector."
About East Africa Metals
The Company's principal
assets include a 30% Net Profits Interest in the Mato Bula and
Da Tambuk mines (collectively "Adyabo Property") and a 70% project
interest in the Harvest polymetallic VMS Exploration Project in the
Tigray Region of Ethiopia. In
addition, the Company has a 30% Net Streaming Interest in the
Magambazi Mine in the Tanga Region of Tanzania.
The Mato Bula and Da Tambuk mines are four kilometres apart and
will be developed simultaneously. The development of the mining
operations are expected to be initiated immediately once commercial
activity in the Tigray region normalizes and it recovers from the
impacts of the COVID pandemic and the political unrest.
East Africa retains exploration
rights on areas of the properties outside the Mato Bula, Da Tambuk
and Terakimti mining licenses in all Ethiopian projects and
anticipates the commencement of exploration drilling to test
priority targets the Tigray region is declared secure for
commercial activity by the Ministry.
EAM has invested US$66.8M in
African exploration since 2005 and identified a total of 2.8
million ounces of gold and gold-equivalent resources
representing an average discovery cost per ounce of US$24.
More information on the Company can be viewed at the Company's
website: www.eastafricametals.com
On behalf of the Board of Directors:
Andrew Lee Smith, CEO, P.Geo., ICD.D
Cautionary Statement Regarding Forward-Looking
Information
This news release contains "forward-looking information"
within the meaning of applicable Canadian securities legislation.
Generally, forward-looking information can be identified by the use
of forward-looking terminology such as "anticipate", "believe",
"plan", "expect", "intend", "estimate", "forecast", "project",
"budget", "schedule", "may", "will", "could", "might", "should",
"indicate" or variations of such words or similar words or
expressions. Forward-looking information is based on reasonable
assumptions that have been made by East
Africa as at the date of such information and is subject to
known and unknown risks, uncertainties and other factors that may
cause the actual results, level of activity, performance or
achievements of East Africa to be
materially different from those expressed or implied by such
forward-looking information, including but not limited to: timing
of receipt of mining permit; timing of mining development;
projected heap leach recoveries ; early exploration; the closing of
the agreement with the exploration and development company to
advance the Magambazi Project or identify any other corporate
opportunities for the Company; mineral exploration and
development; metal and mineral prices; availability of capital;
accuracy of East Africa's
projections and estimates, including the initial mineral resource
for the Adyabo, Harvest and Magambazi Properties; interest
and exchange rates; competition; stock price fluctuations;
availability of drilling equipment and access; actual results of
current exploration activities; government regulation; political or
economic developments; foreign taxation risks; environmental risks;
insurance risks; capital expenditures; operating or technical
difficulties in connection with development activities; personnel
relations; the speculative nature of strategic metal exploration
and development including the risks of diminishing quantities of
grades of reserves; contests over title to properties; and changes
in project parameters as plans continue to be refined, as well as
those risk factors set out in in East Africa's management's discussion and
analysis for the three months and nine months ended September 30, 2018 and for the year ended
December 31, 2017, and East Africa's listing application dated
July 8, 2013 Mineral Resources which
are not Mineral Reserves do not have demonstrated economic
viability. The contained gold, copper and silver figures shown are
in situ. No assurance can be given that the estimated quantities
will be produced. Forward-looking statements are based on
assumptions management believes to be reasonable, including but not
limited to the timely closing of the financing; the timely closing
of the Handeni Property definitive agreement; the price of gold,
silver, copper and zinc; the demand for gold, silver, copper and
zinc; the ability to carry on exploration and development
activities; the timely receipt of any required approvals; the
ability to obtain qualified personnel, equipment and services in a
timely and cost-efficient manner; the ability to operate in a safe,
efficient and effective manner; the renewal or extension of
exploration Licenses; the regulatory framework regarding
environmental matters, and such other assumptions and factors as
set out herein. Although East
Africa has attempted to identify important factors that
could cause actual results to differ materially from those
contained in forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such information will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such information. The
Company does not update or revise forward looking information even
if new information becomes available unless legislation requires
the Company do so. Accordingly, readers should not place undue
reliance on forward-looking information contained herein, except in
accordance with applicable securities laws. Neither TSX Venture
Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this
release.
SOURCE East Africa Metals Inc.
