Core drilling on
the Simbili prospect
at Tonkolili
 
London, England — MININGREVIEW.COM — 22 January 2010 – African Minerals Limited “’ the London-based mineral exploration and development company with significant iron ore and base metal interests in Sierra Leone “’ has conditionally raised US$130 million (R975 million) by way of a cash placing with institutional investors.

Announcing this in a statement here, the company said the money would be used to commence construction of key infrastructure for Phase 1 of its flagship iron ore project at Tonkolili in Sierra Leone.

The statement said a total of 20 million new common shares of the company would be underwritten at a price of 400 pence per share.

In addition to the placing “’and further to the conditional strategic agreement with China Railways Materials Commercial Corporation (CRM) announced by the company earlier this month “’ African Minerals has agreed to grant CRM an option “’ exercisable for 60 days from the date of this announcement “’ to subscribe in cash for up to 2.88 million new common shares at the placing price, representing approximately 14.4% of the placing.

First elements of the Tonkolili project to be tackled include: a haul road of approximately 120km in length to transport hematite iron ore from the Tonkolili mine site to the rail head at Lunsar; and the pre-ordering major long-lead items for the refurbishment of Pepel Port and the railway to Lunsar, together with the requisite equipment for a load-out capacity of 8 million tonnes of iron ore per annum.

Commenting on the successful fund-raising, African Minerals executive chairman Frank Timis said: “We are pleased with the continued support that premier institutional investors in North America and the United Kingdom have given the company, which is a further endorsement of the quality of the Tonkolili project and the executive management team we have assembled at AML.

“The proceeds will allow us to expedite the construction of critical infrastructure required for the first phase of construction of our flagship iron ore project, and places the company in a very strong position to realise iron ore production from Tonkolili during the first quarter of 2011,” he added.