And another one ...
NEWS RELEASE
First Quantum acquires three prospective Gold Projects in Zimbabwe
July 15, 1998 Trading Symbol: FM
First Quantum Minerals, through its 95% owned operating company in Zimbabwe, is pleased to announce that option agreements have been signed on three highly prospective gold projects in Zimbabwe. The Fred, Lone Star and Pezanda Gold Projects are all located on the sites of past producing mines in the gold-rich Bulawayo region. Preliminary geological evaluation of these prospects by Company geologists suggests that an anticipated combined resource of several million ounces of gold is not unreasonable. These acquisitions are part of the Company's overall objective to become a leading gold producer in Zimbabwe.
Fred Gold Project
The Fred consists of 90 claims covering 103 hectares in an Archean folded and sheared basic intrusive-sedimentary environment.
Fred Mine historically produced 600,000 oz of gold at a grade of 11.1 g/t from steeply west plunging, sub-vertical, lenticular quartz veins up to three metres thick.
The Company has recently commenced a reverse circulation drilling program which has intersected zones of quartz stringers adjacent to the mined lenses, 5 to 7 metres either side of old workings. Up to 200,000 oz of contained gold is targeted in this material adjacent to the historically mined Fred lenses in a potentially open pit mineable resource to a depth of 100 meters from surface. Folds in the gold bearing quartz veins at the east and west extremities of the Fred mine were mapped in the underground workings. The mineralized quartz veins continue around these folds towards the Celtic Mine in the north and the Fernando Mine in the south. Recent surface mapping has confirmed this interpretation. These Fred-Fernando and Fred-Celtic trends will be drilled with a target of identifying open pit mineable resources of up to 200,000 oz of gold on each trend. The Fernando Mine itself is also in the area under option and the synformal structure mapped in underground workings will be drilled with a target of 200,000 to 300,000 oz of contained gold. The objective of the current drilling program is therefore to identify a total open pit mineable resource of at least 1,000,000 oz gold.
The agreement with Exmin Syndicate to buy the Fred Mine is an exclusive option to July 15, 1999 to acquire the claims for a payment of US$100,000 plus 2.5 % NSR.
Lone Star Gold Project
The Lone Star consists of 276 claims covering 294 hectares in a thrusted banded iron formation environment. It is characterized by large thicknesses of north-dipping quartz stockworks occurring in granodiorite. Indications by previous operators of bulk mineable grades have been provided in a cross cutting trench grading 1.8g/t over its 50 meter length. Lensoid concentrations have higher reported grades in the 2 to 6 g/t range. Stockworks are particularly concentrated close to the contact with an interpreted over-thrusted, auriferous banded iron formation. A shaft and pits in the iron formation on Ntabaenyorka hill have reported auriferous granodiorite below iron formation at shallow depths suggesting a low angle east dipping mineralized contact. The Company interprets potential along this contact for in excess of 1,000,000 oz of gold in mineralized iron formation and granodiorite. The potential is contained within and below the ironstone that forms Ntabaenyorka hill and could be mined in a pit with a very low stripping ratio. Drilling to assess tonnage potential and grades will begin in the next month.
The option agreement with Exmin Syndicate to acquire the Lone Star has a free exclusive option period of a year which can be exercised on payment of US$1,000,000 plus a 3% NSR commitment to acquire full title to these claims. The option can be extended for an additional year on payment of US$300,000 and further monthly non-refundable payments until the balance of US$700,000 is paid.
Pezanda Gold Project
The Pezanda consists of 41 claim blocks for which transfers have been registered, covering 4,231 hectares within an under-explored Archean Greenstone Belt containing a prominent folded gold bearing iron formation more than 100 kilometers long. The claims cover a 50 kilometer strike length of old workings and mines including the Antelope Mine, Yadkin, Princess, Stella City, and Fluke Mines and most of the key prospects including the Pezanda New Mystery.
Antelope Mine produced 300,000 oz of gold at an average grade of 10.2g/t. The belt has typical Archean prospects in banded iron formation, a serpentinite-sedimentary contact, shear zones, and at Pezanda a highly folded zone with complicated epithermal-like mineralogy and rich pipe-like gold shoots. The belt is considered to have good potential to host a major gold deposit.
An exploration program comprising an evaluation of historical data, mapping, geochemistry, airborne geophysics and reverse circulation drilling is planned to commence shortly.
First Quantum has a four year option to conduct exploration after which US$500,000 is payable to Foundmat Pvt. Ltd. An option payment of US$18,500 equivalent was made to acquire the claims.
The Company currently operates the Connemara open pit, heap leach gold mine near Kwekwe, which has recently undergone an expansion program to produce an anticipated 27,500 oz gold per annum at a cash cost of less than US$200 per oz. These new acquisitions are in line with the company's corporate strategy in Zimbabwe of achieving an annual production of 150,000 oz gold by developing a number of smaller but higher grade orebodies and utilizing shared equipment, infrastructure and technical services to maximize operational efficiencies.
On Behalf of the Board of Directors
of First Quantum Minerals Ltd.
12G3-2b-82-4461
Joseph
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