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ANGOLA
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Metalex entered into an agreement for kimberlite diamond exploration in Angola pursuant to an agreement executed by the Angolan Council of Ministers on April 7, 2005. Pursuant to the agreement, Metalex contributes 100% of all costs incurred by the project up to the end of feasibility studies. These costs are repaid out of future profits and during the period the costs are being repaid, the Company’s interest in the project is 55-60%. After the Company’s costs have been repaid, the Company’s interest in the project is 25%. (detailed below)
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INTERESTS OF METALEX IN ANGOLA
PRIOR TO PAYBACK OF METALEX INVESTMENT AFTER PAYBACK OF METALEX INVESTMENT
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Kimberlite
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Kimberlite
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Metalex
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55-60%
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25%
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Endiama
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25%
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51%
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C4
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15%
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24%
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*Note: Metalex pays all costs up to the end of feasibility studies. Underlying contributing interest may reduce Metalex interest
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ANGOLA MINING INDUSTRY
The fourth largest diamond producer in the world with with an annual revenue of US$1.1 BILLION, 2/3 of which is derived from alluvial production and 1/3 from kimberlite (CATOCA) production.
- whilst the country is exceptionally prospective for new diamond discoveries, exploration was sterilized between 1975 to 2001 due to civil war.
- the end of the civil war has heralded a new era of stability and opportunity.
- Metalex’s Chitamba permit covers one of the most prospective diamond areas in Angola (There were thirteen known kimberlite deposits within the Chitamba licence when it was acquired).
- There are high quality alluvial diamonds currently being mined downstream.
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LOCATION OF CHITAMBA WITH RESPECT TO KNOWN KIMBERLITES AND ALLUVIAL DIAMOND DEPOSITS
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TECHNICAL AND RATIONALE
Metalex considers the Chitamba permit prospective for commercial kimberlite hosted diamonds for the following reasons:
- The source of the abundant diamonds in the Cuango River is considered to be the Chitamba-Lulo kimberlite cluster
- There appears to be two generations of kimberlite within the Chitamba lease.
- There are up to 100 aeromagnetic targets to be tested ranging in size from 10 meter dykes to pipe-like bodies of 20 hectares.
- The exploration target is commercial diamond bearing kimberlite pipes. These can be explored for by drill testing the project’s aeromagnetic anomolies and staged sampling of discovered kimberlites.
PREVIOUS WORK
- Previous exploration by Diamang identified at least 13 kimberlite deposits within the Chitamba lease. Whilst no diamonds were found in the kimberlites, the technology and security of the time were not as advanced as of today.
- The aeromagnetic survey indicates potential for the discovery of new kimberlites.
METALEX WORK/RESULTS
- Kimberlite indicator mineral sampling over the entire licens shows that the eastern part of the area to be the most interesting.
- 67 out of 96 reconaissance samples contain kimberlite indicator minerals.
- The indicator sampling suggests that there may be two populations of kimberlite, one containing both peridotitic and eclogitic garnets, the other containing mainly peridotitc garnets.
- About 100 priority aeromagnetic anomolies have been identified ranging in size from 1 to 39 hectares.
- Drill testing of selected aeromagnetic anomolies is now in progress.
- 38 targets have been tested to date and 29 kimberlites have been discovered including an exceptionally large +/- 24 hectare pipe (news release dated April 1/09 and May 4/09)
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ANGOLA KIMBERLITES - FUTURE WORK
- Continued pitting and drilling of priority aeromagentic anomolies.
- Microdiamond and diamond indicator testing of newly discovered and know kimberlites.
- Staged bulk sampling of potentially commercial deposits.
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