Vancouver, British Columbia - August 22, 2012. Abacus Mining & Exploration Corporation (TSXV: AME "Abacus" or the "Company") is pleased to provide an update following a Board Meeting held on Friday, August 17, 2012 of the joint venture partners of KGHM Ajax Mining Inc. ("KGHM Ajax"). Abacus as 20% owner of the joint venture company met with the senior management of KGHM International Ltd. ("KGHM International"), the Canadian based subsidiary of KGHM Polska Miedź S.A. ("KGHM").
KGHM International to become Operator
On April 2, 2012, as a result of KGHM's exercise of its additional interest option to increase its ownership in KGHM Ajax from 51% to 80% (the "Development Option") under the Joint Venture Shareholders' Agreement dated October 12, 2010 (the "JV Agreement"), KGHM paid approximately US$30 million to Abacus' account in the joint venture company for use towards Abacus' proportionate share of the capital costs of the Ajax copper-gold project (the "Ajax Project"). Under the terms of the JV Agreement, KGHM can elect to become or appoint the Operator of the Ajax Project as well as appoint an additional Director to the Board of KGHM Ajax, prior to which the Board was comprised of two representatives of each of Abacus and KGHM.
At the August 17th Board Meeting, Abacus was notified that KGHM would be appointing KGHM International as the Operator of the Ajax Project effective September 1, 2012. KGHM International also nominated Mark Blakely, Chief Project Officer of KGHM International to the Board of KGHM Ajax.
Appointment of new Leadership Team for KGHM Ajax
Each of Abacus and KGHM selected an appointee for the CFO and COO leadership roles, respectively, for KGHM Ajax, pursuant to the JV Agreement. Jim Excell, currently the CEO of Abacus, will assume the role of CFO, and Mark Blakely will become the COO of KGHM Ajax.
Prior to joining KGHM International, Mr. Blakely held strategic planning and development positions with major international groups, including the Ledcor Group and Morrison Knudsen Corp., and principal engineering positions with Bechtel Civil and Minerals Corporation and Raymond Kaiser Engineers in Australia. In his position as Chief Project Officer at KGHM International, Mr. Blakely oversees KGHM International's post pre-feasibility stage development projects.
It was recognized that the Ajax Project's success would benefit significantly from the knowledge transfer of certain Abacus personnel who have been instrumental in the Ajax Project's development to date, and that the Ajax Project team would be further strengthened by KGHM International personnel having the specific skill sets to advance the project through a successful environmental and permitting phase towards the EPCM and construction start-up.
Jim Excell, President & CEO, remarked, "We are very encouraged by KGHM's assurance that the Ajax Project remains an integral part of KGHM's growth strategy. In addition, KGHM International brings a level of expertise that can advance Ajax along the critical path to production".
Strategic review process update
Abacus has been working with financial advisor Stifel Nicolaus Canada Inc. ("Stifel") to evaluate potential strategic alternatives to maximize the value of its 20% interest in the Ajax Project. Stifel has identified several potential opportunities that are currently under various stages of review. The Company plans to bring this process to the next step in the fall and will notify shareholders of developments or decisions at that time.
Ajax Project Update
Environmental and Permitting Status
The permitting process for the Ajax Project has progressed in conformity with the procedures prescribed by the various levels of the Canadian government and is well underway having commenced in early 2011. Currently and throughout 2012 to date, the focus of Abacus and KGHM Ajax has been the development of the document that will specify the Ajax Project's requirements, and conducting the eventual studies and analyses that will be submitted to the provincial and federal governments for evaluation. This document will follow templates which are expected to be supplied by governments this fall - the Application Information Requirements from a provincial government perspective and the Environmental Impact Statement Guidelines from the federal government perspective.
A major emphasis has been the Ajax Project's integration into the local fabric of the communities in and around Kamloops, and the significant socio-economic contributions over the project's estimated 23 year mine life. KGHM Ajax has committed to hiring primarily from within the local workforce, and to helping local residents qualify for employment through training and development programs. A number of community outreach programmes have been successfully launched, including workshops, open houses, and currently bi-weekly mine site tours, in addition to numerous sponsorships of local businesses and non-profit organizations to demonstrate the project's commitment to the community.
Abacus and KGHM Ajax have held several discussions with representatives of First Nations groups and in particular the Stk'emlupsemc te Secwepemc ("STS"), represented by the Tk'emlups and Skeetchestn Bands, following the Advanced Exploration Agreement signed in December 2010. KGHM Ajax is currently finalizing the Cultural Heritage Study Agreement and business agreement with the STS for the construction and operations of the Ajax mine. A number of on-site tours continue with First Nations groups, many of whom are also part of the working groups as established by the BC Environmental Assessment Office and the Canadian Environmental Assessment Agency. The Company is very encouraged by the cooperation and desire to move forward in a spirit of mutual respect, creating the foundation for a positive partnership for future generations.
On Behalf of the Board,
ABACUS MINING & EXPLORATION CORPORATION
James D. Excell
President & CEO
Director, Investor Relations
Abacus is a mineral exploration and mine development company with a 20% interest in the feasibility stage Ajax copper-gold project located near Kamloops, B.C. The Ajax Project is a joint venture between Abacus Mining & Exploration Corporation and KGHM Polska Miedź S.A. ("KGHM") through KGHM Ajax Mining Inc. ("KGHM Ajax").
The Ajax project feasibility study supports production of a total of 2.5 billion lbs of copper and 2.28 million ozs of gold in concentrate, or an average of approximately 109 million lbs of copper and 99,000 ozs of gold annually, over a 23 year mine life. Total proven and probable mineral reserves are estimated at 3 billion lbs Cu and 2.7 million ozs Au at 0.27% Cu and 0.17 g/t Au based on $2.50 Cu and $1,085 Au. The proposed mine plan envisages a conventional open pit operation processing 60,000 tonnes per day or 21.9 million tonnes per year of ore. [see Report titled "Ajax Copper/Gold Project -- Kamloops, British Columbia Feasibility Study Technical Report" by Wardrop (a Tetra Tech Company) dated January 6, 2012 ("FS")]
This release includes certain statements that are deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address events or developments that Abacus expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include changes to commodity prices, mine and metallurgical recovery, operating and capital costs, foreign exchange rates, ability to obtain required permits on a timely basis, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. Except as required by applicable securities laws, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.
Neither 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 release.
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