AVZ to Complete Acquisition of Manono Extension Lithium, Tin and Tantalum Project in the Democratic Republic of Congo

(firmenpresse) - AVZ to Complete Acquisition of Manono Extension Lithium, Tin and Tantalum Project in the Democratic Republic of Congo

- The Company has finalised its due diligence investigations and agreed to complete the acquisition of the Manono Extension Project located in the south of the Democratic Republic of Congo.

- The Project comprises two granted exploration permits covering 242.25 km2, surrounding the world class historic Manono Mine. The Manono Mine is potentially one of the largest lithium rich pegmatite deposits in the world.

- Preliminary work has confirmed the potential for lithium bearing pegmatites within
the Project area as extensions to the main Manono Pegmatite:

- A large, 800m by 200m highly weathered, pegmatite body has been identified
in the SW of Project occurring along strike from the historical Kitatolo open pit.

- Additional potential remains untested to the NE where observed structures and geology indicate further pegmatite mineralization may exist beneath lateritic cover.

October 31, 2016 - AVZ Minerals Limited (AVZ) is pleased to announce that, further to the announcement of 19 September 2016, AVZ has agreed to complete the acquisition of the Manono Extension Project (Project), following successful completion of its due diligence review. The Project is considered prospective for lithium, tin and tantalum as well as rare earth minerals.

Manono Extension Project

The Project is situated approximately 500km north of Lubumbashi town, within the Tanganyika province in the south of the Democratic Republic of Congo. The Project is located adjacent to the town of Manono, which lies on the western bank of the Lukushi, a tributary of the Luvua River. The project consists of two granted exploration permits, PR4029 and PR4030, that cover approximately 242.25 km2.

The Project lays within the mid-Proterozoic Kibaran Belt - an intracratonic domain, stretching for over 1,000 km through Katanga and into southwest Uganda representing a world scale crustal feature. The belt strikes predominantly SW-NE and is truncated by the N-S to NNW-SSE trending Western Rift system.

The geology of the Manono area is not well documented. The Manono pegmatites are hosted by a series of quartzitic mica schists of the Lower Kibaran and are associated with volcanic and intrusive rocks of mainly doleritic composition. The schists observed in the vicinity of the Manono mine are generally steeply dipping in contrast to the sub-horizontal attitude of the pegmatite intrusion.

The main pegmatite at the historical Manono Mine (the Project being acquired surrounds but does not include the historic Manono Mine) is exposed over 14 kms although only a small portion of this has been drill tested. The main pegmatite was mined for its tin content between 1919 and 1980, during which time a total of 100 million cubic metres (Mm3) of ore were processed to produce 185,000 tonnes of cassiterite concentrate, mainly from eluvial and weathered pegmatite. Production from this ore was economic on account of its amenability to cheap mining and processing methods. The pegmatite remains open to the northeast and southwest of the historic mining activities.

The area around the Manono pegmatite is geologically very poorly mapped and understood, most probably due to the extensive soil and lateritic development. Previous surface sketch mapping and cross sections from the historic mine show in overall terms, the surface exposure of the pegmatite being mostly a shallow dipping body that double-plunges at its NE and SW ends under the mica-schist host lithology.

Within the Project there are two primary targets that have been delineated from the photo-geological interpretation (completed in 2014) that potentially represent the strike extensions of the Manono pegmatite to the NE and to the SW (shown in light pink in Figure 1 below).

Due Diligence Field Work Completed

Two Congolese geologists, led by an senior expatriate geologist, visited the project site during October to complete a due diligence reconnaissance of the licences. Initial reconnaissance mapping discovered the SW pegmatite body and extensive lateritic cover over the NE extension area. Sampling of the SW pegmatite and of soils and lateritic material was undertaken over a period of 10 days.

A total of 18 samples were collected, 6 of which were preferentially selected and submitted in person to SGS laboratories in Johanesburg, South Africa. All samples were submitted to element determination by Sodium Peroxide Fusion through combined ICP-AES and ICP-MS, which involves the complete digestion of the sample in molten flux to produce what is commonly called a total analysis.

SW Extension Target

Within the SW extension corridor, a pegmatite body was mapped of approximately 800m strike length and 200m width. This body straddles the western licence boundary, with approximately 600m of strike contained within PR4030.

The SW pegmatite is a very highly weathered Calcic feldspar (albite)-quartz-muscovite pegmatite with parallels in mineralization characteristics to the main Kitatolo pegmatites, such as the development of large platy microcline feldspars crystals with a columnar nature. Given that the main Manono pegmatites appear to be a laccolith, this recently discovered pegmatite body in the SW may represent the southern extension to the main Kitatolo orebody within a well defined structural corridor.

The presence of lithium in spodumene is hard to determine in extremely weathered units, due to the volatile nature of lithium and its propensity to easily weather to clay. Selected samples of extremely weathered material in this area have returned anomalous levels of base metals at up to 6x background and rare earth elements of up to 2 times background, as well as low level anomalism of Lithium of up to 2 times background. The presence of tin, tantalum and rare earths at elevated levels could be indicative of pathfinder elements for lithium mineralization. Follow up exploration is required to intersect fresh pegmatite at depth where spodumene and therefore lithium will be less decayed.

NW Extension Target

Within the NW extension target area there is a well developed soil cover underneath which there appears to be a well developed lateritic cover. Profile sections observed in areas of artisanal workings suggest soils are around 0.5m thick and laterite between 2 and 3m thick.

This regolith profile masks the underlying rock units and thus, easy identification of any potential pegmatite bodies requires more penetrative exploration methods such as pitting or drilling. Conversely, this profile will have protected any pegmatites present from historical discovery and development. The most significant geological feature found within the target area was a laterite developed in an east west orientation with a length of approximately 2km by 1.5km. Laterites are commonly associated with pegmatite implacement.

A sample of lateritic material taken from this area was submitted for analysis. It contains higher levels of base metals as well as elevated rare earth elements.

The combination of elevated elements as reported is suggestive of the laterite robbing the host lithological units of their constituent elements, which is suggestive of potential for blind mineralization to lay beneath the lateritic cover. Further investigation is required to fully understand this mineralization signature.

Summary and Plans for the Future

The Kitatolo-Manono pegmatite is a world class crustal feature, extending for a strike length of at least 13km within licence PE12202 and extending for kilometres beyond as shown by the SW pegmatite body and other pegmatites some 50km away. Significant potential therefore exists for identifying further resources along the extension of the Manono and Kitatolo pegmatites which is supported by results to date.

Based on the significant strike length (approximately 8-10kms) that exists within the SW and NE extension areas which has not been tested to date, the modest, but encouraging anomalous and associated mineralization, the extensive lateritic and sand colluvium cover and the association of the SW pegmatite to the known strike line of the main Kitatolo and Manono Pegmatite, it is considered there is potential within the Manono Extension Licences for significant lithium, tin and tantalum mineralization.

AVZ initially plans to undertake a regional scale followup on the historic photogeological work, including field mapping of key target areas and pitting. Subject to results, this will be followed by soil sampling and trenching, and then selective drilling. A drilling company representative also recently visited the Project area and confirmed that access is easily achieved.

http://www.irw-press.at/prcom/images/messages/2016/38057/AVZ Manono Extension DD 281016 V2PRcom.001.jpeg

Figure 1 - Photo-geological interpretation of the Project area

Acquisition Agreement

AVZ entered into the agreement to acquire 100% of the Project from Medidoc FZE (Medidoc) on 19 September 2016, and has now completed its technical and legal due diligence. AVZ and Medidoc have agreed to revise the acquisition terms and AVZ will now proceed to complete the acquisition and issue Medidoc 30,000,000 fully paid ordinary shares in the Company and pay Medidoc US$200,000 in cash. AVZ will issue Medidoc a further 20,000,000 fully paid ordinary shares in the Company if AVZ continues to hold the Project after 30 April 2017.

Competent Persons Statement - Exploration Results
The information in this report that relates to exploration results is based on, and fairly represents information and supporting documentation prepared by Mr Nigel Ferguson, a Competent Person who is a Fellow of The Australasian Institute of Mining and Metallurgy and Member of the Australian Institute of Geoscientists. Mr Ferguson is a consultant to AVZ Minerals Limited. Mr Ferguson has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resource and Ore Reserves. Mr Ferguson consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

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Datum: 01.11.2016 - 08:09 Uhr
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