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Anvil to Move to 95% Interest in Kinsevere-Nambulwa Copper-Cobalt Joint Venture

By Anvil - Press Release | Published on January 11, 2007

    Common shares outstanding 56.7 million(*)
    All amounts are expressed in US dollars, unless otherwise stated

    MONTREAL, Jan. 10 - Anvil Mining Limited (TSX, ASX: AVM) ("Anvil")
is pleased to announce it has entered into an agreement to acquire an
additional 15% interest in the mining rights for the Kinsevere-Nambulwa
copper-cobalt deposits located 27km north of Lubumbashi, the provincial
capital of the Katanga Province of the Democratic Republic of the Congo
("DRC"). The additional interest will be acquired from Mining Company Katanga
s.p.r.l. ("MCK"), a private DRC company that is Anvil's joint venture partner
in the Kinsevere-Nambulwa project. Anvil's interest in the Kinsevere-Nambulwa
Joint Venture will increase from 80% to 95% on closing of this transaction.

    Terms of the agreement

    Under the terms of the agreement, Anvil will pay a total of $45 million
in cash and common shares for this additional 15% interest in the project,
taking its interest in the joint venture to 95%. The agreement provides for
Anvil to make payments of $10 million in cash upon the signing of the
agreement, $26 million in cash at closing, and $9 million in common shares of
Anvil Mining Limited. An aggregate of 872,093 common shares will be issued on
closing at a price of US$10.32 per share. When issued, the common shares will
be subject to a four-month hold period in accordance with Canadian securities
    Completion of the transaction is subject to entering into a definitive
agreement, approval by Anvil's Board of Directors and receipt of regulatory
approvals, including the approval of the TSX.
    "This is the second time in less than 6 months that we have acquired a
further interest in the Kinsevere-Nambulwa copper-cobalt Joint Venture. This
acquisition is consistent with our positive outlook for this project, and our
expectation that this will be a large, long-term mining and downstream
processing operation," commented Bill Turner, President and CEO of Anvil
    As reported by the Company in November 2005, an exclusive "Contrat
d'Amodiation" (Lease Agreement) was signed between MCK and La Générale des
Carrières et des Mines ("Gécamines") for a period of 25 years, to mine and
process ore from the Kinsevere and Nambulwa copper-cobalt deposits. The Lease
Agreement was signed under the new DRC Mining Code introduced in 2003.
    The joint venture over the Kinsevere-Nambulwa project is held by a local
company in the DRC, AMCK s.p.r.l. ("AMCK"). AMCK is an incorporated joint
venture company between Anvil and MCK and is the operating company for the
joint venture. Anvil's interest in AMCK, and therefore Anvil's interest in the
Lease Agreement, will increase from 80% to 95% on closing of this transaction,
expected to occur later in the first quarter of 2007. All other terms and
conditions of the joint venture with MCK will remain in full force and effect.

    Resource Drilling

    The first Mineral Resource estimate for the Kinsevere Project was
announced in November 2005, based on a Phase 1 drilling program of
7,889 metres carried out on Tshifufia, Tshifufiamashi and Kinsevere Hill
deposits. The 2006 Phase 2 drilling program, which focussed entirely on the
Tshifufia deposit, totalled 17,220 metres and resulted in the discovery of a
much thicker copper-mineralized zone at Tshifufia than expected. On January 9,
2007 the Company announced a revised Mineral Resource estimate which included
the results of the 2006 Phase 2 drilling program. The Measured and Indicated
Mineral Resource estimate at the Tshifufia deposit now stands at 16.9 million
tonnes at 4.4% Cu for 752,200 tonnes of contained copper, which represents a
770% increase to the previous Indicated oxide resource base at the Tshifufia
deposit alone, and a 450% increase for the Kinsevere Project as a whole.
Furthermore, the average grade of the Measured and Indicated oxide resource at
the Tshifufia deposit has increased to 4.4% copper, up from 3.8% copper for
the Indicated oxide resource from the 2005 drilling.
    In addition to drill testing the oxide copper resources at the Tshifufia
deposit, the underlying sulphide mineralization was also drill tested. An
Inferred Mineral Resource of 15.3 million tonnes at 2.9% Cu for 436,700 tonnes
of contained copper has been defined from the eight holes drilled into
sulphides, to date.
    Phase 2 drilling on the neighboring Tshifufiamashi and Kinsevere Hill
deposits will be undertaken in 2007, along with initial drilling on the
Nambulwa deposit (located 30km north of Kinsevere).

    Staged Mine Development Program

    In May 2006, following completion of a feasibility study, Anvil committed
to a $35 million Stage I development at Kinsevere, which is due for
commissioning during the second quarter of 2007. The Stage I development,
which comprises a Heavy Media Separation Plant and Electric-Arc Furnace is
expected to produce approximately 23,000-25,000 tonnes per annum of "black
copper" ingots assaying 90%-95% copper.
    The Phase 2 drilling results from the Tshifufia deposit have exceeded
expectations and, due to the size of the latest Mineral Resource estimate and
the significant further potential that now exists, the scale of the planned
Stage II SX-EW plant, which is currently the subject of a feasibility study,
has doubled from 30,000 to 60,000 tonnes per annum of SX-EW copper. The
Stage II feasibility study is expected to be completed during the second
quarter of 2007.

    Anvil Mining Limited is an unhedged copper and silver producer whose
shares are listed for trading on the Toronto Stock Exchange (as common shares)
and the Australian Stock Exchange (as CDIs) under the symbol AVM. It owns and
operates the Dikulushi copper-silver mine and the Kulu coarse rejects/tailings
operation in Katanga Province of the DRC. In addition, the Company is
currently developing the Kinsevere Stage I copper-cobalt project, which will
be the Company's third mine development in the DRC.

    (*) One common share on the Canadian share register is equivalent to
    10 CDIs (CHESS Depositary Instruments) on the Australian share

    Additional Note: The information in this news release that relates to
in-situ Mineral Resources is based on information compiled by Gerry Fahey of
FinOre Pty Ltd. Gerry Fahey is a Chartered Professional and a member of the
Australasian Institute of Mining and Metallurgy, and a member of the
Australian Institute of Geoscientists, and has sufficient experience, which is
relevant to the style of mineralization and type of deposit under
consideration, and to the activity he is undertaking, to qualify as a
Qualified Person in terms of the Canadian National Instrument 43-101. Gerry
Fahey consents to the inclusion of such information in this news release in
the form and context in which it appears.

    Caution Regarding Forward Looking Statements: The forward-looking
statements made in this news release are based on assumptions and judgments of
management regarding future events and results. Such forward-looking
statements, including but not limited to those with respect to current and
future developments of the Kinsevere mine and estimated future production
levels for Stages I and II, involve known and unknown risks, uncertainties,
and other factors which may cause the actual results, performance or
achievements of the Company to be materially different from any anticipated
future results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the actual
market prices of copper and cobalt, the actual results of current exploration,
the actual results of future mining, processing, construction and development
activities, changes in project parameters as plans continue to be evaluated,
as well as those factors disclosed in the Company's filed documents.

    %SEDAR: 00020549E

@Congoplanet |

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