2012-11-30 00:08:47 -
Toronto, Ontario CANADA, November 29, 2012 /FSC/ - Alexander Nubia International Inc. (AAN - TSX Venture), ("AAN" or the "Company today reported its financial results for the three and nine month period ended September 30, 2012. All amounts are in Canadian currency unless otherwise noted.
Key Operational and Financial Highlights of the Quarter and the Nine months ended September 30, 2012:
* Current quarter:
Hamama volcanogenic massive sulphide ("VMS") deposit at the Abu Marawat Concession:
* Excavator lead trenching program completed:
* Trenching program identified a broad high-grade gold-silver zone. Characteristic of other major VMS systems in the Arabian-Nubia shield is an iron-rich oxidized gold cap at surface with base-metal rich massive and semi-massive sulphides at depth.
* Select trench results:
DT-86: 46 metres grading 2.92 g/t gold, 50.2 g/t silver.
DT-96 : 68 metres grading 3.07 g/t gold, 38.1 g/t silver.
Abu Marawat gold-copper deposit at the Abu Marawat Concession:
* Reconnaissance exploration program yielded positive surface sampling results from four prospects located within 20 kilometres of the Abu Marawat deposit.
* Continued the cost reduction and cash conservation program commenced in Q2 2012 in order to minimize the Company's burn rate.
* Prior quarters:
Hamama VMS deposit at the Abu Marawat Concession :
* First stage exploration results indicated:
* Western VMS Zone is a broad zone of VMS gossan traced at surface extending along strike for 1,100 m and up to 110 m wide;
* Main VMS Horizon traced over 3,000 m;
* Completed a first pass diamond drilling program focused on the relatively accessible Central VMS Zone. A fence of drill holes confirmed mineralization from surface to a depth of 125 m, containing up to 9.60% zinc, 0.55% copper, 1.48 g/t gold and 44.3 g/t silver and mineralization remains open at depth;
* New discovery, the Valley VMS Zone, stratigraphically below the Main VMS Horizon. Deep Trench 72 (DT-72) returned 0.46% copper and 0.17% zinc over 24 m;
* Initial set of deep trench results confirms extensive at-surface gold mineralization in Western VMS Zone:
o Select Deep Trench 87 (DT-87) returned 66 m grading 1.33 g/t gold, 53.7 g/t silver, and 0.11% copper with a core of 34 m grading 2.23 g/t gold, 93.9 g/t silver;
* Widespread zinc and copper values from the footwall stringer zone and in the Valley VMS Zone are suggestive that higher-grade base metals may exist deeper in the system below the zone of leaching; and
* At-surface copper mineralization in footwall stringer zone of the Central VMS Zone:
o Select Deep Trench 82 (DT-82) returned 12 m grading 0.26% copper and 0.11% zinc in the stringer zone below the Central VMS Zone.
Abu Marawat gold-copper deposit at the Abu Marawat Concession:
* The Abu Marawat Technical Report shows a mineral resource estimate, which management has determined to be equivalent to an inferred mineral resource of 397,000 ounces of gold plus gold equivalent(1);
* Resource is based on 50% of the available strike length at an average depth of 200 meters;
* Deposit is characterized as mesothermal with the potential to extend up to depths over 1,500 meters; and
* The remaining strike length, depth extension and new zones laterally to the main zone have yet to be tested sufficiently by drilling.
(1) Gold-Equivalent Calculation
Management has used the following to determine the inferred mineral resource of 397,000 ounces of gold plus gold equivalent:
As disclosed in the Abu Marawat Technical Report, the Abu Marawat deposit inferred mineral resource is: 2.9 million tonnes at an average grade of 1.75 g/t Au, 29.3 g/t Ag, 0.77 % Cu and 1.15 % Zn, containing 162 thousand ounces Au, 2.7 million ounces Ag, 49 million pounds Cu, and 73 million pounds Zn. The gold equivalencies of silver, copper, and zinc are based on the metal prices used in the NSR model as follows: Au US$1400/ounce, Ag US$26/ounce, Cu US$3.50/pound and Zn $1.15/pound.
* Initiated a cost reduction and cash conservation program in order to minimize the Company's burn rate; and
* On May 29, 2012, completed private placement of convertible debentures and warrants for gross proceeds of $215,000.
Key Operational and Financial Highlights Subsequent to Quarter-end:
Hamama VMS deposit at the Abu Marawat Concession:
* Relogging of drill holes by the Company's senior geologist produced an updated interpretation of the section, confirming structurally overturned massive sulphide mineralization at the stratigraphic top of an extensive series of brecciated and silicified felsic domes.
* Commenced a 1,500 metre diamond drilling program to test only a portion of the Main VMS Horizon, with a focus on the new discovery, the Western VMS zone.
* Initial drill results confirm a gold cap within the Western VMS Zone. Significant drill hole intersection:
AHA-15: 39 metres grading 2.22 g/t gold, 102.2 g/t silver and 1.64% zinc.
* On October 16, 2012 the Company completed a non-brokered private placement for net proceeds of $422,917 (gross proceeds of $447,917). In connection with the financing, 8,958,339 shares in the capital of the Company (the "Common Shares") were issued at a price of $0.05 per share.
All shares are subject to a four month hold period dated from their respective date of issuance.
As the gross proceeds of the private placement exceeded $430,000, the accelerated payment provision (the "Acceleration Provision") of the convertible debentures issued May 29, 2012 (the "Debentures") was triggered. All holders of the Debentures waived the applicability of the Acceleration Provision in respect of the private placement.
Selected Financial Results
To view the table, please click on teh link at the bottom of the release.
* As at September 30, 2012, payment of $539,944 of the current liabilities has been deferred by certain vendors, service providers, management and employees until the Company completes a financing.
Review of Financial Performance for the Quarter and the nine-months ended September 30, 2012
For the quarter ended September 30, 2012, the Company incurred $131,778 in exploration expenditures at the Hamama deposit, continuing the first phase of exploration commenced in Q1 2012. This compares to $925,814 for the comparable period of 2011. The decrease is primarily attributable to the completion of the Company's Phase 2 drill program at the Abu Marawat deposit in late 2011 and a deferral of the Company's next phase of drilling and other capital intensive exploration activity until such time as capital is raised by the Company. These expenditures bring total exploration costs less impairment provisions since commencement of exploration in Egypt to $8.2 million.
For the nine months ended September 30, 2012, the Company incurred $911,544 in exploration expenditures (including initial exploration costs at the Hamama deposit of $635,736). This compares to $3,383,509 for the comparable period of 2011. The reason for the decrease is described above. Payment for $327,679 of the exploration expenditures incurred in the nine month period ended September 30, 2012 has been deferred by certain vendors, service providers, management and employees and included in the total of $911,544 indicated above.
As is expected for an early-stage mineral exploration company, the Company incurred a loss of $232,566 for Q3 2012, and $652,136 for the nine-months ended September 30, 2012, which are comparable to the losses incurred for Q3 2011 and the nine months ended September 30, 2011 of $163,381 and $637,942, respectively. Payment for $212,266 of the operating expenses incurred in the nine month period ended September 30, 2012 has been deferred by certain vendors, service providers, management and employees and included in the total of $652,136 indicated above.
At September 30, 2012, after incurring $131,778 in exploration costs in the quarter and using $202,383 to fund operations, the Company had a working capital deficiency of $453,067 (December 31, 2011 - working capital of $821,107), including cash and cash equivalents of $169,133. In order to address this situation, the Company has made arrangements with certain vendors, service providers, management and employees to defer payment on the accounts payable and accrued liabilities to these vendors at September 30, 2012 totaling $539,944, creating a working capital position of $86,877 excluding the deferred amounts. The Company also decreased its working capital deficiency by raising net proceeds of $422,917 in October, 2012 by way of a non-brokered private placement for Common Shares. If the Company continues to be able to defer payments to certain vendors, service providers, management and employees of the Company, and to curtail exploration activities, the Company expects the working capital that it has available as a result will be sufficient to allow the Company to finalize the current exploration program underway and to fund general operations to enable it to focus on raising required capital beyond the end of the year.
The Company is exploring various financing options which management believes that it can complete in the near future.
"Due to the overall market and regional conditions during the third quarter, the Company curtailed its exploration program at the Hamama VMS deposit. A deep trenching program was completed that provided very encouraging results at Hamama which identified an additional drill target, an enriched gold zone at-surface extending over 650 metres and up to 110 metres wide in the Western VMS Zone." said the Chief Executive Officer, Mr. Massoud. He further commented, "The recently completed fundraising supported a drill program at Hamama. The initial results of this drill program are a success, they demonstrate that the Western VMS Zone contains a gold cap. This is another excellent vector, as world-class VMS deposits within the Arabian-Nubian shield are characterized by a gold cap within the oxidized zone and a base-metal-rich massive sulphide at depth. We look forward to the upcoming drill results."
The business objectives of the Company for the next 12 months are as follows:
* Diamond drilling to test the strike and depth extension of Western VMS and Central VMS zone. In addition to testing the depth extension of the Eastern VMS zone, numerous alteration zones and the stacked VMS lenses, north of the Main VMS horizon;
* Metallurgical test work;
* Mapping, and where appropriate deep trenching, to identify and explore the property extensions; and
* A geophysical program to identify potential massive sulphide bodies at depth.
Abu Marawat Deposit
* Stage 3 diamond drilling program to upgrade resources from inferred to measured and indicated;
* Metallurgical test work; and
* Exploration drilling to test two new vein zones identified by deep trenching laterally from the main zone.
General Business Objectives
* To continue exploration for precious and base metals within the other targets; and
* To raise funds required to advance exploration programs.
Readers are advised that these highlights should be read in conjunction with the Company's interim management's discussion and analysis, and the interim unaudited condensed consolidated financial statements for the third quarter ended September 30, 2012.
Cautionary Note Regarding Exploration Results From Hamama Deposit
The potential quantity and grade of the mineral occurrence at the Hamama deposit is conceptual in nature. Insufficient exploration has been done to date to define a mineral resource and it is uncertain if future exploration will result in the target being delineated as a mineral resource. For additional disclosure regarding the Hamama deposit, see the Company's press releases dated April 30, 2012, May 9, 2012, May 24, 2012, June 19, 2012, August 15, 2012, September 5, 2012, October 2, 2012, October 19, 2012, October 30, 2012, and November 20, 2012 filed under the Company's profile on SEDAR at www.sedar.com.
The technical information contained in this news release was prepared or reviewed under the direct supervision of Mr. Ralph Gonzalez (P.Geo.), the Company's Project Manager for exploration in Egypt. Mr. Gonzalez is a qualified person within the meaning of NI 43-101.
About Alexander Nubia International Inc.
Alexander Nubia International Inc. is a Canadian mineral exploration company committed to identifying, focusing on, and advancing gold and base-metal projects in the Eastern Desert of Egypt. The Company holds two exploration concessions in Egypt: Abu Marawat and Fatiri, which cover areas of 1,027 km2 and 1,745 km2, respectively. The Company is focused on exploration within the Abu Marawat Concession, which contains the Company's two main properties, the Abu Marawat mesothermal vein deposit, with an NI 43-101-compliant inferred gold-copper-rich resource, and the Hamama volcanogenic massive sulphide (VMS) deposit.
Operating in Egypt since 2007, the Company is focused on the advancement of the Hamama VMS deposit - located in the Arabian-Nubian Shield (ANS), which is known for the quality of its VMS deposits. Positive first-stage drill results indicate high-grade semi-massive and massive sulphide mineralization, a broad zone of VMS gossan at-surface containing high-grade gold and silver, and an extensive mineralized footwall stringer and breccia zone.
The Company holds a highly prospective land package with an established history of mining dating back to the Pharaonic era. The area contains three historical gold mines and four prospects. The land package is enhanced by excellent nearby infrastructure which includes access to highway and railway, a high-capacity electricity grid, and the nearby major cities of Qena, on the Nile River, and Port of Safaga, on the Red Sea.
For more information on Alexander Nubia please contact:
A. Alexander Massoud
President and Chief Executive Officer
Egypt: +2 (0) 22 287 6914
Canada: +1 (877) 607-4747
Donald M. Cameron, CA
Canada: +1 (877) 607-4747
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
The securities of Alexander Nubia International Inc. described herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Certain statements contained in this press release constitute "forward-looking statements". All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company's future financial position and results of operations, strategy, proposed acquisitions, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words "believe", "expect", "aim", "intend", "plan", "continue", "will", "may", "would", "anticipate", "estimate", "forecast", "predict", "project", "seek", "should" or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company's expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements.
Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to: stock market volatility; negative operating cash flow and working capital deficiency; need for additional financing; operations in Egypt and political instability; limited operating history; future issuances of securities may depress the trading price of the Common Shares; foreign investments and foreign operations (including various political, economic and other risks and uncertainties); dependence on a single mineral project; challenges to the Company's title to mineral rights, including challenges in the Egyptian court system; speculative nature of precious metal exploration projects; mineral projects and mineral operations; regulatory, consent or permitting delays; environmental risks; reliance on the management team and outside contractors; lack of availability of qualified management personnel; uninsured risks; gold price volatility; expenditures required to establish mineral reserves; fluctuations in currency exchange rates; related to the Phase I for the Company's Fatiri concession; conflicts of interest; dividends; high inflation rates; limited availability of debt financing in Egypt; competition from other businesses; reliance on various factors (including local labour, importation of machinery and other key items, and business relationships); a shift in commodity trends and demands; and vulnerability to fluctuations in the world market. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.
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Source: Alexander Nubia International Inc. (TSX.V - AAN) www.alexandernubia.com
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