The announcement of Great Western Exploration Limited (PDF)

The Spasskaya Copper Project is located in central Kazakhstan near the major regional centre of Karaganda, a two hour drive southeast of Astana. The project comprises a 12,500km² area covering the majority of the historical Spasskaya Copper Field. Soviet-era exploration reports describe a number of significant copper, silver, zinc, molybdenum, tin and bismuth occurrences within the Spasskaya Project (occurrences generally not assayed for gold). In total, 350 copper occurrences were indicated from surface sampling within the project area of which 150 recommended for further work.

The styles of mineralisation reported include:

• Vein hosted and disseminated copper related to epithermal mineralisation.
• Breccia related mineralisation.
• Sediment hosted mineralisation.
• Stockwork and associated disseminated mineralisation within bi-modal rhyolite and andesite lava sequences.
• Granodiorite, diorite and monzodiorite porphyry related copper-silver-gold mineralisation.

Great Western Exploration has agreed to form a Joint Venture (JV) with TKS for the exploration and production of copper, gold and by-products at the Spasskaya Copper Field.

The following is a high level summary of the terms of the HoA:

• Great Western Exploration (“the Company”) has agreed to fund the project through to Bankable Feasibility Study (“BFS”) to earn its 50% JV interest.
• The Company will act as the Operating Managers of the JV and the project. As such the Company will be responsible for all budgets, exploration planning and execution and all the other technical and financial responsibilities.
• TKS will act to ensure that the JV carries out exploration according to the rules, regulations and accounting methods of Kazakhstan and will assist in gaining the appropriate work approvals and local community liaison.
• There is a deferred payment calculated using a formula based on the Measured and Indicated resources, copper price and recovery as defined in the BFS. The Deferred Payment is amortized over the estimated life of the mine and can only be paid out of the Company’s portion of cash flow and only when the project is cash flow positive. By way of example, the formula yields a deferred payment of $225,000,000 based upon 2 million tonnes of contained copper metal in JORC Measured and Indicated Category at a copper price of US $8,500 per tonne and 80% recovery.
• The Company will loan at no interest (if necessary) the TKS portion of equity to fund the development of the project.
• 100% cash flow of the project will be retained until all loans are repaid
• The Company will fund the project annually and can withdraw without penalty prior to committing to the following year’s expenditure.