AFRICAN QUEEN CUTS EXPENSES AND STREAMLINES PROJECT PORTFOLIO; DROPS MOZAMBIQUE OPERATIONS INCLUDING KING SOLOMON PROJECT
Vancouver, British Columbia — AFRICAN QUEEN MINES LTD. (the “Company”) is pleased to announce that it has now completed a thorough review of its portfolio of exploration properties in Southern, West and East Africa, in order to reduce costs of operations and to prioritize projects for development in 2013, while at the same time paring down its portfolio to eliminate projects which have not generated sufficiently promising results to warrant continued exploration. As a result, the Board of Directors has determined that it is in the best interests of the shareholders of the Company to focus exploration expenditures in 2013 on its priority gold projects in Kenya at the Odundu target in the Rongo Gold Fields and at Ugunja, and in Ghana at the Noyem-Nyanfoman Gold Project on the Ashanti Belt. At the same time, it is now abandoning further development of the King Solomon Project in Mozambique and is terminating its exploration activities in that country.
As a junior resource company with a portfolio of highly prospective exploration properties in different regions of Africa and a seasoned technical team, but facing relatively limited availability of exploration funding in the present difficult financial environment, management believes it is important to prioritize our projects. We can best build shareholder value by focusing our efforts and financial resources on those projects holding out the most promise and periodically dropping projects which do not demonstrate sufficiently positive results to warrant our continued development efforts.
At the same time as we have been reviewing all projects, we have also reviewed all aspects of overhead and expense facing the Company in 2013 and have now implemented cost-cutting measures in all aspects of our operations, both at our home office in Vancouver and in our overseas operations and exploration programs. We have always prided ourselves on being extremely cost-conscious and operating in a very lean and efficient manner. We are now taking that even further through staff cuts, salary reductions, reductions in other operating and exploration costs, and through abandonment of our Mozambique operations. The bottom line is that we intend to operate in 2013 as one of the lowest cost and most efficient African explorers, constantly mindful of reducing overheads and expenses, with a sharp reduction in our already modest burn rate. At the same time we intend to work diligently to continue to advance our key projects in order to add shareholder value.
As part of the management review process of all our projects, a decision has now been made to abandon the King Solomon Project, covering approximately 230 sq. km in the central parts of the Mesoproterozoic Fingoe Belt of Western Tete Province, and to terminate our operations in Mozambique. The King Solomon Project is subject to an Earn-In and Joint Venture between the Company and Swiss-based Opti Metal Trading Limited, under which the Company has thus far earned a 51% interest. Extensive exploration has been carried out on this Project over the past three years, including mapping, geophysical and geochemical surveys, as well as two programs of core drilling aggregating approximately 5346 m. Unfortunately, results achieved to date have failed to materially advance the project and do not suggest a high likelihood for the potential to host commercially viable deposits of gold or other minerals. Results of the second drill program, reported January 6, 2012, failed to reflect meaningful widths or continuity of gold-bearing mineralization. Subsequent study during the past year did not generate any further highly prospective drill targets.
The work carried out at King Solomon has led to a large increase in our knowledge and understanding regarding the geologic setting and genesis of the gold-bearing mineralization in place in the region. This better understanding has not, regrettably, translated into the identification of areas of better or more continuous mineralization than first identified. In fact, the most promising gold, copper and silver mineralization was identified in our initial surface sampling programs and to some extent reflected in the first core drilling program carried out in 2010.
The independent technical team of Remote Exploration Services of Cape Town, S.A. carried out the work program at King Solomon on a contract basis in association with our own technical team headed by Senior Consulting Geologist Mr. Pete Siegfried (M.Sc., MAusIMM), a Qualified Person. Site visits by independent Qualified Persons Dr. Peter Christopher and Prof. John Moore have also assisted with our understanding of the regional geology. During the period of our regional exploration, the Company hosted mapping projects for Prof. Daud Jamal and a number of geology students from the University of Eduardo Mondlane. Prior to the second drilling program, an in-depth geophysical interpretation by independent geophysicist Dr. Branco Corner was obtained.
Mr. Siegfried has reviewed and approved the contents of this Press Release.
According to Irwin Olian, CEO of the Company, “We must be responsive to the overall economic climate and relatively limited availability of exploration funding at this time. This requires that we use a very sharp pencil in limiting all costs and evaluating ongoing expenditures on our exploration projects. Dropping King Solomon and our Mozambique operations is a necessary part of this process and will allow us to now focus on our higher priority projects in Kenya and Ghana.”
The Company is an exploratory resource company with diversified mineral properties in Southern, East and West Africa. It is exploring its properties in Mozambique, Ghana and Kenya for gold and other metals and it is undertaking exploration in Botswana and Namibia for diamonds, gold and other metals. In Mozambique the Company has approximately 230 sq. km. under license for gold and metals under an agreement with another company. In Ghana it has 28.9 sq. km. under license for gold. In Kenya it has approximately 850 sq. km. under license for gold and metals, and a further 737 sq. km. of gold and other minerals licenses under agreements with two other companies. The Company’s operations in Mozambique are carried out through its subsidiary PAM Mocambique Limitada and its operations in Ghana are carried out through its subsidiary AQ Ghana Gold Limited. Its operations in Kenya are being carried out through its operating subsidiary AQ Kenya Gold Limited. Its operations in Botswana are carried out through its operating subsidiary, PAM Botswana (Pty) Ltd.; its operations in Namibia are carried out through its operating subsidiary PAM Minerals Namibia (Pty) Ltd. The Company has its executive offices in Vancouver, Canada. The Company was incorporated under the laws of the Province of British Columbia, Canada on April 30, 2008 and received certain southern African assets in a spin off transaction related to the acquisition of Pan African Mining Corp. by Asia Thai Mining Co., Ltd.
ON BEHALF OF THE BOARD OF DIRECTORS OF
AFRICAN QUEEN MINES, LTD.
Chairman & CEO
For more information, contact:
President and CEO
Phone: (604) 899-0100
Fax: (604) 899-0200
Dubai - +971 55 997 0427
London - +44 (0) 7780 602 788
Germany - +49 (0) 21141 740411
U.K. - +44 (0) 870 490 5443
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of the information contained herein. The statements made in this press release may contain certain forward-looking statements that involve a number of risks and uncertainties. Actual events or results may differ from the Company's expectations.