Anglo-African Minerals completes scoping study with positive results

Anglo-African Minerals completion of Scoping Study for FAR Bauxite Project, Guinea, West Africa Inferred Mineral Resource of 43 million tonnes Positive NPV of US$ 163 million Anglo-African Minerals Plc, the GXG quoted mineral exploration company focused on bauxite in West Africa is pleased to announce that its wholly owned subsidiary, Forward Africa Resources S.A. FAR S.A. has received positive results from its recently completed Scoping Study on its FAR Bauxite Project located in Guinea, West Africa.

Highlights for the Base Case:

• Development of a 3Mtpa bauxite export operation with a planned product specification of 41.9% Al2O3, 3.4% SiO2, and a planned moisture content of 11%;
• Internationally compliant Inferred Mineral Resource, with opportunity to expand the current resource of 43Mt to extend mine life;
• Preliminary results from current exploration infill drilling campaign due in early 2015;
• Shallow open-cut mine, utilising conventional drill and blast, truck and shovel operations, with 15 years of mine production;
• Utilisation of existing third-party operated rail and port infrastructure.
• LOM free cash flow of USD294 million;
• Free on Board (FOB) estimated average selling price of USD33.25/t bauxite;
• Positive cash flow within 12 months of commission; and
• Positive Net Present Value of USD163 million.

James Lumley, the company’s Chief Executive Officer commented, “the Scoping Study of the FAR Bauxite Project base case indicates a positive NPV which is a multiple of the company’s market capitalisation. The Board considers that this can be elevated through additional drilling to increase the existing 43 million tonne resource base and potential life of the mine. The Board have elected to prioritise the development of the FAR Bauxite Project through the establishment and commencement of more detailed fast-tracked technical studies focused on the material aspects of the project. I look forward to updating shareholders over the forthcoming months as we continue the development of our priority FAR Bauxite Project.”

Highlights of the Scoping Study results indicate potential for an economically viable project, generating cash flow at current bauxite prices and for a relatively low capital outlay through the use of contractors, subject to completion of a formal feasibility study.

Following the announcement of its Maiden Mineral Resource in October 2014, AAM engaged SRK Consulting (UK) Limited to undertake a Scoping Study on its FAR Bauxite Project, located in Guinea. The objective of the Study was to define preliminary project economics in order to allow the Company to prioritise the next stages of the project’s development. The Study commenced in October 2014, and various high-level engineering studies were undertaken, including; exploration, geology and resources, geotechnical engineering, mining and production, plant and processing, infrastructure and logistics (including Port studies), environmental and social and economic assessment. The Mineral Resource Estimate used for the Study totals an Inferred Mineral Resource of 43 Million tonnes grading at an average of 41.9% Al2O3 and 3.4% SiO2.

The Base Case focused on mining 5 resource plateaux with an average bauxite thickness of 5 metres (<0.5m of overburden) over an initial 15 year life of mine has been proposed. Following completion of the Scoping Study, the Directors have decided to progress the development of this project and to embark on a further drilling programme in an effort to upgrade the existing resource to a higher confidence Indicated Mineral Resource category, with a view to moving forward with a Feasibility Study commencing early 2015.

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