CALGARY, ALBERTA--(Marketwire - Dec. 27, 2007) - TVI Pacific Inc.
(TSX:TVI) or (the "Company"), announced today that its Philippine
affiliate, TVI Resource Development (Phils.) Ltd. ("TVIRD"), and Atlas
Consolidated Mining and Development Corp. ("ACMDC") have entered into
negotiations respecting the establishment of a joint venture for the
development of TVIRD's Canatuan sulphide project in the Philippines. The
Company's interest in the Canatuan Mine and its other Philippine assets
are held through TVIRD.
Certain information set out in this News Release constitutes
forward-looking information, including information relating to (i) the
transition of the Canatuan mine to production of copper and zinc from
the underlying sulphide deposit, (ii) timing expectations concerning the
commencement of operation of the proposed sulphide plant at Canatuan,
(iii) anticipated capital costs and working capital requirements for the
sulphide project at Canatuan, (iv) the timing of detailed engineering
of the process plant at Canatuan, and (v) the timing of construction of
phase 1 of the tailings dam for the sulphide project at Canatuan.
Readers should review the cautionary statement respecting
forward-looking information that appears at the end of this News
Release.
TVIRD and ACMDC have signed a memorandum of agreement under which
TVIRD has received an advance in the amount of 42 million Philippine
pesos (approximately US$1 million) from ACMDC, which is secured by an
accommodation pledge of 10% of the outstanding capital stock of TVIRD.
This pledge has been granted by the Company's wholly-owned subsidiary
TVI International Marketing Ltd. In connection with the advance, TVIRD
has granted an option to ACMDC to enter into a joint venture with TVIRD
to develop the Canatuan sulphide project. The option, which expires on
January 15, 2008, is subject to any extensions mutually agreed upon by
the parties in writing. Under the terms of the advance, no interest is
payable by TVIRD as long as the parties continue to negotiate the joint
venture. The memorandum of agreement with ACMDC provides that if the
parties enter into the joint venture, the advance will be settled in
accordance with the final joint venture agreement, however, if ACMDC
determines not to proceed with the joint venture, the advance will at
that time be treated as a loan and will be re-payable within six months,
together with interest at 15% per annum.
In addition to the negotiations with ACMDC, TVIRD is involved in
discussions with other parties to secure the funding required to develop
the Canatuan sulphide project and to reduce the Company's working
capital deficiency. There can be no assurance that the joint venture
contemplated by the memorandum of agreement with ACMDC will be
successfully concluded or that the Company will be able to secure third
party financing to develop the Canatuan sulphide project.
About the Canatuan Sulphide Project
The Canatuan mine currently produces gold and silver dore and,
following the planned construction of the sulphide plant, will
transition into the production of copper and zinc concentrates from a
sulphide deposit underlying the current open pit operation.
Assuming that project financing is available in early 2008, TVI is
targeting to have the sulphide plant in operation in the second half of
2008.
TVI has financed the initial development and construction of the
sulphide project from cash flow generated by the current gossan
operations. As at December, 2007, TVI expects that the remaining capital
cost and working capital requirements for the sulphide project will be
approximately US$14.4 million. The estimated cost to complete the
project reflects potential cost savings assuming that portions of the
current gossan producing plant can be converted to the proposed sulphide
processing plant. To date, TVI has made considerable progress on the
sulphide project, including:
- All permits required for the project are in place;
- Tax exemption has been approved by the Philippine Board of Investment;
- Updating the computerized geologic block model based on the 2006
drilling program, for which a new NI 43-101 report is underway to update
mineral resources and reserves;
- Metallurgical test work for process optimization almost complete;
- Detailed engineering of the process plant due in Q1 2008;
- Purchased three used ball mills, two of which have been refurbished, 1 in storage;
- Tailings dam construction underway, phase 1 to be completed in Q1 2008 with 1 year capacity;
- Electrical power line under construction;
- Additional administration office building, warehouse and lab upgrade all completed; and
- Acid mine drainage study for waste rock and dam is ongoing
In July 2006, TVI filed an independent technical report on the
sulphide project prepared by Norwest Corporation in accordance with
National Instrument 43-101.
TVI has engaged an independent third party to update the NI 43-101
mineral resource estimate for the Canatuan deposit. The report is
expected to incorporate results from an extensive drilling program
consisting of 197 drill holes for a total of 8,380 metres that was
completed in late 2006, as well as extensive metallurgical testing which
is still ongoing. TVI has requested the updated mineral resource and
reserve models to, among other things, facilitate detailed planning and
operational optimization for the Canatuan sulphide project.
About TVI Pacific Inc. (TSX:TVI)
TVI Pacific Inc. is a publicly traded Canadian mining company
focused on exploring for and producing precious and base metals within
district scale systems in the Philippines and other Asian countries. The
Company's interest in the Canatuan Mine and its other Philippine assets
are held through its affiliate, TVI Resource Development (Phils.) Ltd.
TVI's most advanced project, the Canatuan Mine, currently produces gold
and silver dore.
About ACMDC
Atlas Consolidated Mining & Development Corporation is a major
mining corporation active in the Philippines. Atlas is listed on the
Philippine Stock Exchange (PSE: AT) with a current market capitalization
of approximately US$340 million, and was, until May 1995, listed on the
American Stock Exchange (AMEX). Among Atlas' significant mining assets
in the Philippines are the Toledo Copper Mine in Cebu, where copper
concentrates are expected to be exported from starting mid-2008, and the
Berong Nickel Project in Palawan, which has commenced exporting nickel
ore to China in early 2007. Atlas also owns a portfolio of mineral
interests throughout the Philippines, which include advanced and
greenfield copper, gold and nickel targets.
Certain information set out in this News Release constitutes
forward-looking information. Forward-looking statements are often, but
not always, identified by the use of words such as "seek", "anticipate",
"plan", "continue", "estimate", "expect", "may", "will", "intend",
"could", "might", "should", "believe" and similar expressions.
Forward-looking statements are based upon the opinions and expectations
of management of the Company, as at the effective date of such
statements and, in certain cases, information provided or disseminated
by third parties. Although the Company believes that the expectations
reflected in such forward-looking statements are based upon reasonable
assumptions, and that information obtained from third party sources is
reliable, it can give no assurance that those expectations will prove to
have been correct. Forward-looking statements are subject to certain
risks and uncertainties (known and unknown) that could cause actual
outcomes to differ materially from those anticipated or implied by such
forward-looking statements. These factors include, but are not limited
to, such things as the volatility of prices for precious metals and base
metals, commodity supply and demand, fluctuations in currency and
interest rates, inherent risks associated with the exploration and
development of mining properties, ultimate recoverability of mineral
reserves, timing, results and costs of exploration and development
activities, availability of financial resources or third-party
financing, new laws (domestic or foreign), changes in administrative
practices and changes in exploration plans or budgets.
Accordingly, readers should not place undue reliance upon the
forward-looking statements contained in this News Release and such
forward-looking statements should not be interpreted or regarded as
guarantees of future outcomes. Forward-looking information respecting
the anticipated transition to production of copper and zinc from the
sulpide deposit at Canatuan is based upon TVI's current mining plans for
the Canatuan mine. Forward-looking information respecting the
anticipated timing and capital costs related to the startup of the
sulphide plant at Canatuan is based upon the status of negotiations
concerning financing of the sulphide project, that financing will be
available on terms acceptable to TVI Pacific, the status of TVIRD's
program to source equipment for the expansion of the Canatuan mine,
progress made to date in the construction of the sulphide plant at
Canatuan, management's experiences with the construction of the gossan
processing facility at Canatuan, and mining plans, capital budgets and
other projections prepared by the Company. As well, where applicable,
forward-looking information is based upon the Company's current business
strategy, budgets, mine plans and projects, all of which are subject to
change. The forward-looking statements of the Company contained in this
news release are expressly qualified, in their entirety, by this
cautionary statement. Various risks to which the Company is exposed in
the conduct of its business are described in detail in the Company's
management's discussion and analysis for the year ended December 31,
2006 and the Company's amended Annual Information Form for the year
ended December 31, 2006, which were filed on SEDAR on December 18, 2007
and are available under the Company's profile at www.SEDAR.com.
Subject to applicable securities laws, the Company does not undertake
any obligation to publicly revise the forward-looking statements
included in this news release to reflect subsequent events or
circumstances.
The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.