Star Zinc Project Update

 RNS Number : 6554X

Galileo Resources PLC

01 May 2019

 

For immediate release

 

Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR).

 

1  May 2019

Galileo Resources Plc

(“Galileo” or “the Company”)

Star Zinc  – Negotiations to Commence for Off-take Agreement

 

Galileo is pleased to announce negotiations are to commence with Jubilee Metals Group plc (“JMG” or “Jubilee”), for an off-take agreement to supply ore from Star Zinc (“SZ”), pursuant to a Binding Term Sheet (“Term Sheet”) (announced 31 August 2017). Commencement of negotiations is facilitated by JMG’s recently announced acquisition (21 March 2019) of Glencore’s Sable zinc refinery (the “Acquisition”) for its Kabwe Tailings project in Zambia  and the Company’s  recent placing to raise £500,000, before expenses. to advance its 80.75% owned Star Zinc project.

Highlights

 

·    Jubilee’s acquisition of the Sable refinery (the “Refinery”) enables negotiations to commence with JMG for an off-take agreement to supply ore mined from Star Zinc and other potential ore sources nearby, to which the Company has the exclusive option to acquire

 

·    Star Zinc has an independently modelled exploration target estimated at between 600,000 and 900,000 tonnes (t) with an estimated average grade of 10 to 12%  Zn (announced 14 November 2018), with a high grade (>20% Zn)  component estimated at  between 60,000 to 90,000 t rock mass

 

·    Potential earnings from Star Zinc could be significant in the near future as there would be no requirement  for either  mining or processing capital 

 

·    Mining risk and costs would be low since the deposit is shallow, mainly near surface to maximum   60 m deep  and parts of the  deposit could be mined using mechanical diggers without the need for blasting

 

·    Coincident with the off-take agreement negotiations, the Company will expedite use of the proceeds from the Placing to produce a JORC 2012 maiden resource estimate and an open pit design and plan to mine ore from Star Zinc

 

·    Future exploration for the Company will include the Kashitu zinc willemite (zinc silicate ore mineral) prospect, some 6 km distant from the Refinery, subject to completion of the acquisition of the Kabwe Residual Rights announced on 13 September 2018.

·    Kashitu is believed, by the Directors,  to have similar mineralisation to Star Zinc and future ore from Kashitu would  supplement that from Star Zinc

 

·    Historically, vanadium has been identified on Kashitu.  Star Zinc,  however  contains silver and germanium,  which  would  be included  in off-take agreement negotiations depending on their recoverability

 

·    Kashitu licence area is more extensive  than Star Zinc and   is therefore  believed to have the potential for  a much larger tonnage  based on interpretation of historical exploration  on Kashitu

 

 

Colin Bird Galileo CEO said “Jubilee’s acquisition of the Sable refinery and development plans necessitates  fast tracking negotiations for an off-take agreement to supply Star Zinc ore.  We will undertake all necessary work, related to expedite producing a JORC compliant maiden resource estimate and a mining plan for ore from Star Zinc. The Kashitu prospect has the potential to be a bigger resource than Star Zinc and we intend to commence  a study  for exploration on this prospect as soon as practicable.”

 

JMG’s plans regarding its acquisition of the Sable Zinc refinery in Kabwe Zambia expects to deliver the first metal from its Kabwe Tailings within a year from the acquisition.  In order to meet this schedule Galileo will expedite    the completion of  a maiden mineral resource estimate to 2012 JORC Code standard, which will include  commissioning the refinement of its existing ETR model, in order to delineate a) potential high-grade and low-grade zinc components in the body, and b) develop an open pit design for selective mining, as appropriate, as run-of-mine feed to Kabwe.

 

Technical Sign-Off

 

Andrew Sarosi, Director of Galileo, who holds a B.Sc. Metallurgy and M.Sc. Engineering, University of Witwatersrand and is a member of the Institute of Materials, Minerals and Mining, is a “qualified person” as defined under the AIM Rules for Companies and a competent person under the reporting standards. The technical parts of this announcement have been prepared under Andrew’s supervision and he has approved the release of this announcement.

 

 

 

You can also follow Galileo on Twitter: @GalileoResource

 

For further information, please contact: Galileo Resources PLC

 

Colin Bird, Chairman

Andrew Sarosi, Executive Director

Tel +44 (0) 20 7581 4477

Tel +44 (0) 1752 221937

Beaumont Cornish Limited – Nomad

Roland Cornish/James Biddle

Tel +44 (0) 20 7628 3396

Novum Securities Limited – Broker

Colin Rowbury /Jon Belliss

+44 (0) 20 7399 9400

 

 

 


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