Afri-Can boosts Block J stake (July 29, 2002)

Junior Afri-Can Marine Minerals (AFA-V) has increased its stake in the Block J marine concession in Namibia to 60% from 50% by paying $125,000 to Woduna Mining Holding. Consequently, Woduna now holds 40%.

Under a 1999 option agreement, Afri-Can can acquire up to a 70% interest in the concession, in increments of 10% priced at $125,000 each. Block J covers about 1,000 sq. km of the sea floor in water as deep as 167 metres. It is near another concession, owned by Namibian Minerals (NMR-T), about 105 km north of Luderitz Bay.

“Positive exploration results led to the decision to increase Afri-Can’s interest in the Block J,” says Afri-Can President Pierre Leveille. “We’re convinced it is a prime area for further development.”

Earlier this year, De Beers Marine collected 338 samples from 29 sites across 728 sq. metres of ocean floor. Each sample represents 2.1 sq. metres of sediments, and two of the samples yielded more than two stones.

In all, 23 stones weighing 4.65 carats were recovered. The largest stone tipped the scales at 0.64 carat; another five exceeding 0.3 carat.

Fourteen of the stones, including all the larger ones, were collected from features 6 and 8. (Afri-Can has outlined three main features — nos. 6, 8 and 17 — at Block J. Combined they cover about 10 sq. km).

Some 3.1 sq. km of gravels contained in the 3.7-sq.-km feature 6 have been confirmed as diamondiferous. At the 11.7-sq.-km feature 8, Afri-Can has delineated about 2 sq. km of weakly cemented diamondiferous conglomerate. Feature 17 comprises 0.7 sq. km of diamondiferous gravels.

Afri-Can says the area contains up to another 25 sq. km of prospective diamondiferous ground.

The company plans a 3-phase attack on the Woduna option. Initially, from feature 6, it will collect 109 ten-square-metre samples plus three bulk samples of about 100 sq. metres each.

Sampling will then shift to feature 8, where the company intends to take 105 ten-square-metre samples and 300-sq.-metre bulk samples.

A third round of sampling, to be completed by contractors, will see about 179 ten-square-metre samples collected from the paleo-surf zone on the two features.

The sampling will provide data for an inferred resource calculation and a preliminary economic assessment, as well as determine the extent and continuity of mineralization.

Afri-Can holds interests in three other 1,000-sq.-km concessions adjacent to Block J: the company can earn a 55% undivided interest in the Block N concession from Karas Mineral Holding; it has a deal to earn a similar interest in the Block M concessions from Kuwelai Delta Mining; and it can earn up to a 70% stake in Block K from Tsondab Gem Exploration.

An option and joint-venture agreement with Together Quando Mining Consortium paves the way for Afri-Can to earn up to an 80% interest in Block B, a 250-sq.-km shallow water concession stretching out about 30 metres from the surf zone. Afri-Can operates the joint venture.

In mid-June, Afri-Can announced it would privately place a maximum of 8.3 million units at 30 apiece for proceeds of $2.5 million. Each unit comprises one share plus half a non-transferable warrant. One full warrant allows the holder to buy one share for 40 for 18 months after closing. Shares issued under the private placement will be subject to a 4-month hold period. Regulators have yet to approve the deal.