Luiri Gold Zambian mining licence reinstated

THE BOURSE WHSIPERER: Emerging African gold developer Luiri Gold has had its Large Scale Mining License LML 48 reinstated by the Zambian Ministry of Mines and Mineral Development.

LML 48 contains the Matala and Dunrobin gold deposits in the company’s Luiri Hill deposit.

Luiri Gold is now able to immediately recommence full-scale exploration and development activities in Zambia.

Under the terms of the settlement reached with the Government of Zambia and other agreements with relevant stakeholders a Cancellation Notice that was issued in June 2010 in respect of LML 48 has been extinguished by the Government of Zambia and Luiri has discontinued its appeal against the decision of the country’s Minister of Mines.

As a result, the Government of Zambia has confirmed that LML 48 is once again valid and effective as if the Cancellation Notice had never been issued.

A key part of the settlement was Luiri’s agreement to continue with its project development activities and to be in a position to commence construction of a mining project prior to December 31, 2013.

“The timeframe allows for two complete dry seasons in which to progress and complete field exploration,” Luiri Gold said in its ASX announcement.

“The directors of Luiri believe this provides the company with sufficient time to complete the necessary exploration activities prior to commencing possible mine development.

“The company has also made meaningful commitments to the local community with the initial funding of a community development trust and the facilitation and funding of a community development committee, each as further described below.

“The agreements are the result of extensive negotiations by the management team of Luiri with the relevant Zambian Government departments and stakeholders to resolve the various issues that had caused the Cancellation Notice.

“During the negotiations, Luiri demonstrated good faith by continuing to employ 29 full time workers and taking on additional personnel on short-term contracts to progress exploration trenching in preparation for a new drilling program.”

Luiri Gold said it considers LML 48 to be under-explored and highly prospective for mineralisation.

The company’s proposed work program negotiated in conjunction with the full reinstatement of LML 48 will entail a combination of exploration and project evaluation study work.

Additional exploration drilling will be conducted with the express objectives of increasing the resource base, and identifying high-grade ore easily mineable by open pit methods to support fast track development of mining and production.

While the exploration drilling ins underway study work will be carried out to to develop potential plans for mining and processing, to accurately evaluate costs and revenue estimates and to assemble a project implementation plan and development schedule.

During this period, Luiri said it will also be seeking all necessary permitting for project development.

The company said it would use all this work to support a definitive technical and financial evaluation that will be used as the basis for project financing.