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Gold/Mining/Energy : Pangea Goldfields T.PGD -- Ignore unavailable to you. Want to Upgrade?

To: Claude Cormier who wrote (944)	5/9/2000 11:59:00 AM
From: russwinter	Read Replies (1) \| Respond to of 1178

Titanium demand per PGD press release: Titanium minerals ilmenite and rutile are primarily used in the fabrication of pigments and titanium metal while zircon is used in glazing and foundry applications. With a worldwide pigment market demand growing at an average compound rate of 2.8 percent, reaction to Tiomin's marketing efforts with major titanium and zircon consumers has been very favourable. There is general agreement in the industry that a substantial shortfall in titanium and zircon feedstock supply will arise as early as 2003 unless new sources such as Kwale are brought into production.

To: Claude Cormier who wrote (944)	5/9/2000 12:56:00 PM
From: russet	Respond to of 1178

Hi Claude, My understanding is the banks will not lend Tiomin the money unless the company secures contracts to supply a certain percentage of the output. The feasibility study indicates they can do the project, but they must secure customers or the project dies. I believe they have verbal agreements with customers, but I've seen nothing in writing. Summary NR,... Pangea's Kenyan project to generate high profits Tiomin Resources Inc TIO Shares issued 41,133,942 May 8 close $0.85 Tue 9 May 2000 News Release See Pangea Goldfields Inc (PGD) News Release Mr. Jean-Charles Potvin reports Pangea Goldfields has released the findings of a positive feasibility study recently completed on the Kwale titanium-bearing mineral sands deposit in Kenya. Pangea holds a 20-per-cent net profits royalty on the Kwale deposit as well as three other mineral sands deposits being developed by Tiomin Resources Inc. in Kenya. The comprehensive study recently presented to the government of Kenya highlights the strong economics of the Kwale deposit. The project capital costs are estimated at $137-million (U.S.), including contingency provisions. As stated in the study, the project shows robust economics and, based on current commodity prices, is expected to yield an internal rate of return in excess of 20 per cent and achieve a capital payback within 3.5 years. It is expected that upon completion of further test work and review of optimization value engineering exercises, considerable savings can be achieved on the capital and operating budgets. The Pangea royalty is payable from operating profits after recovery of capital investment. The projected cumulative net cash flow to Pangea over the 14-year mine life is estimated to be $45-million (Canadian) or about $2 (Canadian) per common share. In the first six years of operation, the project is expected to produce annually on average, in excess of 300,000 tonnes of ilmenite, 75,000 tonnes of rutile and 37,000 tonnes of premium zircon. At current commodity prices the project will have an average annual cash flow during the first six years in excess of $70-million (Canadian). Titanium minerals, ilmenite and rutile, are primarily used in the fabrication of pigments and titanium metal while zircon is used in glazing and foundry applications. With a worldwide pigment market demand growing at an average compound rate of 2.8 per cent, reaction to Tiomin's marketing efforts with major titanium and zircon consumers has been very favourable. There is general agreement in the industry that a substantial shortfall in titanium and zircon feedstock supply will arise as early as 2003 unless new sources such as Kwale are brought into production. By year-end 2000, Tiomin anticipates receiving the necessary mining and environmental permits from the Kenyan government, securing the remaining surface rights in the mine area, signing long-term sales contracts and arranging project financing. Construction is expected to commence in early 2001, with production startup anticipated for mid-2002. (c) Copyright 2000 Canjex Publishing Ltd. canada-stockwatch.com