AMANTA ANNOUNCES TUNGSTEN JOINT DEVELOPMENT AGREEMENT
February 13, 2006
Vancouver, Canada - Amanta Resources Ltd. (Amanta) is pleased to announce that it has signed a Joint Development Agreement with Mae Fah Mining Ltd. (Mae Fah) to acquire and develop up to four formerly producing tungsten mines in Thailand. Amanta’s existing Doi Ngom tungsten project, for which a first-phase diamond drilling programme is currently being planned, was also formerly a tungsten-producing mine.
Mae Fah is a privately owned Thai company active in the mining industry. Ms. Suchada Sanksuwan, President of Mae Fah, serves as a Director of Amanta.
During the late-1970s, Thailand was one of the largest tungsten producers in the, then, ‘non-communist’ world, with annual production levels of over 4,500 tonnes of (WO3) concentrates. Production peaked in 1978 when over 7000 tons of concentrate were produced, making Thailand the world’s third largest producer after China and the USSR.
Thai tungsten production was from deposits associated with the granites of the southeast Asian tin belt which runs north-south over the length of Thailand and gives rise to skarn scheelite deposits, greisen associated quartz-wolframite vein deposits and two spectacular stockwork-breccia filling ferberite deposits. The Company’s Doi Ngom tungsten project is an example of the latter.
Although a fairly large number of small and very small scale operations existed, production in Thailand was dominated by a limited number of larger mines such as the scheelite mines at Doi Mok and Samoeng in northern Thailand, the wolframite mines at Mae Lama-Mae Saraing at the Burmese border and especially during the more recent years, the ferberite producers at Doi Ngom in north Thailand and Khao Soon in the south. In all these operations mine production was from high grade ore shoots and hand-sorted high grade material.
The demise of the Thai tungsten industry between 1980 and 1986 was a result of changing market conditions. The increasing dominance of production from China and the subsequent tungsten price collapse caused most of the Thai tungsten operations to close down. In the late 1990s Thailand’s annual output was less than 100 tons of concentrates. Practically all of the former mines were abandoned and for many of these the mining licences lapsed over time.
Driven by increasing Chinese demand for tungsten, prices have risen dramatically from around $6,500 per tonne (January 2004) to the present levels of around $26,500 per tonne. Noting the renewed interest in tungsten as a commodity, Amanta recognised the potential for Thailand to regain a prominent position amongst the world producers when making the decision to acquire its interest in the Doi Ngom property as its entry to the tungsten industry in March 2005.
Mae Fah has conducted a review of the Thai tungsten industry, identifying four of the more prolific former tungsten producing areas and has been negotiating to acquire the exploration and development rights to each of these. Three of these areas are located in northern Thailand and retain valid mining licences, while the licences for the fourth area (Khao Soon, located in southern Thailand) have now lapsed.
Mae Fah has now reached an agreement to acquire the exploration and development rights under the existing Mae Lama Mining Licences and has initiated negotiations with the Licence holders of the other licenced deposits, known as Doi Mok and Samoeng, all in northern Thailand. Mae Fah has also prepared applications for Special Exploration Licences for the Khao Soon area in southern Thailand.
The Mae Lama group of deposits are characterised by a wolframite-scheelite, arsenopyrite, pyrite assemblage occurring in hydrothermal quartz veins, pegmatites and disseminated in granite. Mae Lama is located about 120 km. west of Chiang Mai.
Under the terms of the Joint Development Agreement, Mae Fah will be responsible for concluding negotiations to acquire the exploration and development rights for each of the areas, while Amanta shall have overall responsibility for technical management of all exploration and development activities. Amanta shall have the exclusive right to participate in each tungsten project acquired by Mae Fah and shall retain management responsibility and authority for each project under development.
Amanta shall have the right to earn an initial 49% working interest in each project acquired by Mae Fah by funding and conducting agreed exploration and development activities including drilling programmes, resource evaluation and a pre-feasibility study. Amanta shall then have the option to acquire a further 41% project interest, increasing its total interest to 90%, in any such project by providing Mae Fah with a 10% carried interest in that project.
Under the Agreement, Amanta will pay Mae Fah the sum of USD $50,000 in respect of the initial (Mae Lama) project acquisition and shall reimburse Mae Fah for any reasonable expenditures incurred in acquiring the additional properties. Amanta will pay an additional USD $25,000 as each subsequent project is acquired and Mae Fah will also receive a 1% Net Smelter Royalty on all mineral production from any property which becomes subject to the Joint Development Agreement.
Amanta views this Joint Development Agreement as an important step in the revival of the tungsten mining industry in Thailand. The opportunity to gain the controlling interests in up to five former tungsten producers will enable Amanta to assume a dominant role in the industry in S.E. Asia.
Geological Information contained within this report has been verified by Pieter Bakker (Director, Executive VP – Amanta Resources Ltd.). Mr. Bakker satisfies the requirements of a Qualified Person as defined in the National Instrument 43-101 (Standards of Disclosure for Mineral Projects).
ON BEHALF OF THE BOARD OF
AMANTA RESOURCES LTD.
“Gerald D. Wright”
Gerald D. Wright,
President
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